A discount rate helps analysts and managers determine the value (or potential value) of an investment or portfolio. They’re an important part of the CFA® Level I exam.
I would like to address some of the common mistakes made by candidates during the CFA® exams and how those mistakes can be avoided so that you don’t have to go through the rigmarole of taking the exams multiple times in order to pass them—which unfortunately was the case for me. While I am not proud of the fact that I had to take the exam multiple times, and some might consider it foolish to talk about failures, I learnt much from those failures.
One of the remarkable trends of the last 10 years has been the growing popularity of exchange traded funds (ETFs) as advisers and the investing public have grown frustrated by their failed efforts to outperform the major market indexes. As returns continue to fall short of expectations and the prospects of subpar annual returns looms on the horizon, fees for actively managed portfolios are receiving greater attention than they would in a higher-return environment.
The general public’s awareness of such issues as climate change, labor practices, and corruption has greatly increased in recent decades. We’ve all heard of huge multinational corporations caught (and fined for) polluting the environment, bribing government officials for permits and contracts, or exploiting outsourced workforces in developing countries.
Technology is a disruptive force that creates challenges for established business models in many industries. Job losses in manufacturing are largely attributable to advances in technology, but the impact of technology isn’t confined to manufacturing-related industries.
Of the few online searches I did on CFA career paths when I first contemplated writing my Level I exam 15 years ago, working in the mining space was not on any top 10 lists that I came across. Yet in the decade that has passed since I first started my mining career (mostly gold, with some copper and a sprinkle of silver), I have worked closely with both the buy-side and sell-side while simultaneously acquiring industry-specific knowledge.
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