Cfa Level 1 Mv

Nominal Interest Rate = Real interest rate + expected inflation rate

(1+ periodic rate)^m -1

e^r -1 = EAR

D/F x 360/t

(Fv - price)/Fv x 360/t

HPY = (P1-P0+D1)/P0 = (P1+D1/P0) -1

Effective Annual Yield

= (1+HPY)^(365/t) -1

Money Market Yield = HPY(360/t)

MMY = (Fv - price)/price x (360/t)

1+Rg = n•sqrt((1+R1)•(1+R2)•..•(1+Rn))

Standard deviation/mean

(Rp-Rf)/(st.dev.p)

P(AB) = P(A/B) x P(B)

P(A or B) = P(A) + P(B) - P(AB)

P(A and B) = P(A) x P(B)

P(B/A) = P(B) x P(A/B) / P(A)

Z= (observation - population mean)/standard deviation

(E(Rp) - RL)/st.dev.

RL = Threshhold level return

Ln(1+HPR)

(Standard dev or sample dev)/sqrt(n)

(% change in quantity demanded)

/

(% change in own price)

(% change in quantity demanded)/(% change in income)

(% change in quantity demanded)/(% change in price of related good)

(Nominal GDP in year t)/(value of year t output at base year prices)×100

GDP=C+I+G+(X-M)

(Cost of basket at current prices)/( cost of basket at base period prices) × 100

1/Reserve Requirement

Money Supply x Velocity = Price x Real Output

MV=PY

(X-M) = (S-I) + (T-G)

1/(1-MPC(1-t))

MPC = Marginal Propensity to Consume

RER= Nominal Exchange Rate x (CPIb/CPIp)

CPIb = CPI base currency

CPIp = CPI price currency

RT = annual sales/ average receivables

DoSA = 365/RT

IT = COGS/ average inventory

DoIOH= 365/IT

PT = Purchases/ average payablesNoDoP = 365/PT

(Cash + marketable securities + receivables )/ (current liabilities)

CCC = Days of Sales outstanding + Days of Inventory on hand - Number of Days of Payables

OC = Days of Sales outstanding + Days of Inventory on hand

EBIT/Interest Payments

(EBIT + Lease Payments) / (Interest Payments + Lease Payments)

FCFF = net income + noncash charges + (cash interest paid (1-t)) - fixed capital investment - working capital investment

Net income + noncash charges - working capital investment = CFO

FCFE = cash flow from operations - fixed capital investment + net borrowing

Basic EPS = (net income - preferred dividends) / (wheighted avg number of common shares outstanding)

Ending Inventory = Beginning Inventory + Purchases - COGS

Inventory: LIFO Inv + LIFO Reserve

COGS: LIFO COGS - delta(LIFO RESERVE)

(2/useful life)(cost - Ac. Depreciation)

ITE = Taxes Payable + delta(DTL) - delta(DTA)

Taxes Payable = Taxable Income x Statutory Rate

ETR = ITE/PTI

ITE = Income Tax Expense

PTI = Pre Income Tax

1+(PV of future Casf Flows/CF0)

Kps = Dps/P

Kce = D1/P0 + g

Kce = Rf + Beta(Rm - Rf + country risk premium)

Kce = bond yield + risk premium

Q(P-V) / (Q(P-V)-F)

% change in EBIT / % change in sales

EBIT / (EBIT - I)

(Q(P-V)- F) / (Q(P-V)- F - I)

% change in EPS / % change in EBIT

DOL x DFL

% change in EPS / % change in sales

BEY = (Fv - price)/price x (365/t)

BEY = HPY x (365/t)

BEY = 2(Effective semi-annual yield)

Rp = Rf+ (Rm - Rf)(st.dev.p/st.dev.m)

Beta = COVi,m / VARm = CORRi,m(st.dev.i/st.dev.m)

Beta measures sistematic risk.

Same as CAPM

Ri = Rf + Beta(Rm - Rf)

Plots return (y axis) vs Beta (x axis)

MCP = Po ((1-Initial Margin) / 1- Maintenance Margin))

Initial Margin is Equity %

Po = D1/(Ke - g)

Ke = req. Rate of return

g = expected growth rate

EM = Po/E1= expected dividend payout ratio / (k - g)

Market value of common & preffered stock + market value of debt - cash & short term investments

Or EBITA × EV Multiplier

Market value of common stock = market cap

Full price - accrued interest

(1× S2)^2 = (1+S1)(1+1Y1Y)

OAS = Z-Spread - Option Value

Macaulay duration / (1+YTM)

-ModDur x deltaYTM

(V_-V+)/(2Vo•deltaYTM)

Risky asset + derivative

Intrinsic Value + time value

S = C - P + X(1+Rf)^T

(1 + Rf - D)/(U-D)

D = 1/U

Forward/Spot = (1+ Interest Rate price currency)/(1+ Interest Rate base currency)

-Duration x delta(yield) + 1/2 x Convexity x delta(yield)^2