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Finance Fundamentals
Южно-Африканская Республика
Добавлен 10 сен 2020
Welcome to Finance Fundamentals, where complex finance topics are simplified so that you can get a CLEAR understanding.
I'm Dr. Mark Bunting, an associate professor and CFA Charterholder, with nearly three decades of experience educating students in both undergraduate and postgraduate programmes.
Finance Fundamentals is your go-to resource for mastering finance, whether you're a student pursuing a finance degree, preparing for the CFA Charter, or just keen on broadening your financial knowledge. Our content is meticulously crafted to aid learning and foster a deep understanding of finance.
You are very welcome to join the vibrant community on our Discord server (see invitation link below). Here, you will find a treasure trove of resources, including free downloads of readings and materials used in our videos.
Subscribe and join us on this journey to demystify finance, one video at a time. Let's explore the fascinating world of finance together!
I'm Dr. Mark Bunting, an associate professor and CFA Charterholder, with nearly three decades of experience educating students in both undergraduate and postgraduate programmes.
Finance Fundamentals is your go-to resource for mastering finance, whether you're a student pursuing a finance degree, preparing for the CFA Charter, or just keen on broadening your financial knowledge. Our content is meticulously crafted to aid learning and foster a deep understanding of finance.
You are very welcome to join the vibrant community on our Discord server (see invitation link below). Here, you will find a treasure trove of resources, including free downloads of readings and materials used in our videos.
Subscribe and join us on this journey to demystify finance, one video at a time. Let's explore the fascinating world of finance together!
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The simplest installation for beginners. A user-friendly, step-by-step guide.
Просмотров: 59
Видео
Sensitivity, specificity, precision ... ???
Просмотров 2314 дней назад
How to calculate some of the key metrics used to evaluate the errors made by machine learning classifier models.
Confusion matrices
Просмотров 7614 дней назад
Getting started with using the confusion matrix to evaluate machine learning model performance.
Probability Trees
Просмотров 7621 день назад
Probability trees are a very useful way of visualizing and working with unconditional, conditional, and joint probabilities. This video gives an easy-to-understand overview.
Corporate Finance Mock Exam Part 4
Просмотров 11028 дней назад
Part 4 of a discussion of the Mock Exam for an introductory Corporate Finance Course. Free copies of the course materials, exam and solutions are available on the Finance Fundamentals Discord: discord.gg/9VCnEQ2yTG
Corporate Finance Mock Exam Part 1
Просмотров 207Месяц назад
Part 1 of a discussion of the Mock Exam for an introductory Corporate Finance Course. Free copies of the course materials, exam and solutions are available on the Finance Fundamentals Discord: discord.gg/9VCnEQ2yTG
Real-World Fixed Income Pricing Explained: Walmart Case Study
Просмотров 759 месяцев назад
Continue your journey through the dynamic field of finance as we unravel the complexities of real fixed income pricing using Walmart's $1 billion 2052 issuance as our guide. This video takes you beyond theoretical examples and puts you right in the middle of actual financial markets. We focus on Walmart's 2052 notes, breaking down the terms of the bond issue and demonstrating the practical appl...
Mastering Periodicity in Time Value of Money: Unlock Financial Precision!
Просмотров 669 месяцев назад
Welcome to a pivotal instalment of the Finance Fundamentals TVM Crash Course series: Lesson A.8 on PERIODICITY. Join us as we take a careful look at a critical yet often misunderstood element in financial calculations that can lead to costly mistakes if not properly applied. In this lesson, we'll clarify the difference between compounding frequency and cash flow frequency, debunk common misconc...
Discount Rate Secrets Revealed! (Which Rate to Use for Every Cash Flow)
Просмотров 439 месяцев назад
Stop using the wrong discount rate! This video (with FREE cheat sheet) reveals the exact rates to use for stocks, bonds, and more. Get the essential knowledge you need to choose the correct discount rate for various types of cash flows. Whether you're analyzing dividends, corporate bonds, or derivatives, understanding the appropriate rate of return is critical. We break down complex finance con...
TVM Timeline Tactics: Visualize, Simplify, and Ace Your Finance Studies!
Просмотров 929 месяцев назад
Welcome to Lesson 5 of the Finance Fundamentals TVM Crash Course, a must-watch for university students and CFA candidates exploring the world of finance. In this episode, we unlock the secrets of mastering Time Value of Money (TVM) calculations through a simple yet powerful tool - Timelines. 📈 Why Timelines in TVM? * Visual Learning: Discover how drawing timelines transforms abstract financial ...
Cash Flow Signs: Why Your Calculator Hates You (And How to Fix It!)
Просмотров 799 месяцев назад
Stuck with "Error 5" on your financial calculator? Cash flow signs might be the culprit! This episode of the Finance Fundamentals TVM Crash Course offers serious help with this crucial yet often confusing topic. You'll learn: - Why cash flow signs matter: Understand the real-world logic behind positive and negative cash flows. - Calculator quirks vs. financial reality: Uncover why calculators e...
Essential Financial Calculator Skills for TVM, DCF, and More!
Просмотров 13110 месяцев назад
Welcome to Episode 3 of the Finance Fundamentals TVM Crash Course, your essential guide to mastering financial calculations! Whether you are preparing for CFA exams, or a university student in finance, this video is tailored for you. 🔹 What's Inside: - Detailed walkthroughs for HP12C, BA II Plus, and HP 10b calculators. - Step-by-step guide for 5-key TVM and DCF calculations, and exponent-based...
Ultimate Calculator Setup Guide: Mastering the HP12C, TI BA II Plus, and HP10bII+ for Finance
Просмотров 23410 месяцев назад
Welcome to Lesson A2 of the Finance Fundamentals TVM Crash Course Series! In this video, I'll guide you through the essential setup steps for your HP12C, TI BA II Plus, or HP10bII . Whether you're preparing for the CFA exams or just keen on sharpening your finance calculation skills, this tutorial is tailored for you. You'll learn how to sort out: 1. Periods Per Year Settings: Optimize your cal...
The Essential Calculator Guide for Finance Students & Professionals
Просмотров 11810 месяцев назад
Welcome to Episode 1 of the Finance Fundamentals TVM Crash Course Series! In this video, you will learn about the practical aspects of financial calculators, crucial for mastering time value of money (TVM) concepts. Whether you're preparing for the CFA exams or enhancing your financial acumen, this guide covers the key features and comparisons of 3 popular calculators: the HP 12C, Texas Instrum...
Zero-Coupon Bonds & Non-Dividend Stocks: The Simplest Timelines!
Просмотров 4010 месяцев назад
Ever wondered how to value a zero-coupon bond or a non-dividend stock? This video breaks down the basics of TVM for these simple timelines, using clear explanations and practical examples. Regain your independence from the 5-key TVM zone of your calculator and learn the powerful equations that will unlock your understanding of TVM! This is Lesson B1 of the Finance Fundamentals TVM Crash Course ...
Say Goodbye to Rate Confusion! Basis Points, Percentages & Decimals Demystified
Просмотров 547Год назад
Say Goodbye to Rate Confusion! Basis Points, Percentages & Decimals Demystified
Can you calculate IRR given payback, or NPV given profitability index?
Просмотров 204Год назад
Can you calculate IRR given payback, or NPV given profitability index?
Capital Budgeting - Ranking mutually exclusive projects with unequal lives
Просмотров 2,3 тыс.Год назад
Capital Budgeting - Ranking mutually exclusive projects with unequal lives
Capital Budgeting - Getting the nonroutine cash flows right
Просмотров 334Год назад
Capital Budgeting - Getting the nonroutine cash flows right
CAPM: Watch out for these avoidable exam traps!
Просмотров 284Год назад
CAPM: Watch out for these avoidable exam traps!
Unlisted company beta: Avoid this exam trap!
Просмотров 246Год назад
Unlisted company beta: Avoid this exam trap!
Very clear explanation. You've made it all seem easy. Thank you!
This is exactly what I try to aim for - helping others to avoid the frustrations I ran into when I was learning this stuff myself! Really appreciate you letting me know it helped.
Good day, I am accounting student at UJ and final year. I am wondering if i should register to write the CFA level 1 in February 2025. I have a strong understanding of Accounting and Finance. I found some 600 hours i can squeeze to work on my CFA notes before the exams. I am also good with statistics and economics but my degree did not have investments. Would you recommenced me trying on this CFA exam level 1.
Also would doing the CFA level 1 exam be good for my cv or be any way beneficial if I pass?
If you are on the SAICA route, I would say don't even think about it until you have passed *both* the ITC and APC exams (or whatever they are called now). If you are not on a CA(SA)-track and you are genuinely good with the math-related stuff I would say go for it. The lack of investment management content in your degree will not stand in your way. And your ecos and accounting background will be a huge help. But you 150% definitely need more advice than just from me. Do PLENTY of due diligence before you push the button on this.
Yes! In fact, CFA Institute have started issuing digital certification badges for passing Level 1, that you can post to your LinkedIn profile. But Level 1 only gets you so far. It should not be your target endpoint.
@@financefundamentals Thank you Mr Man I have decide to move the date to May and give myself enough time to prepare for the exam as its very expensive. I will also not be working and focus on mastering the contents and practicing, thank again!!! 🙂
amazing my man, u saved me
Finally, a video that explains the granularity of beg and end mode!
Awesome! I wasn't making it up when I said that even senior professionals are sometimes clueless with this issue.
Thanks so much, I want to know,why you use rotate normalize not rotate. What i can do if i did normalize of data at beginning
Remember that I am replicating the Hair et al results, and they did not start their PCA by normalizing their data first. If you are doing your own project and your step 1 was normalizing your data, then I would imagine that adding the "normalize" parameter will have no effect. Why not try both commands, "rotate" and "rotate, normalize" to see what differences (if any) you get?
Great video man
Must have tried a dozen tutorials to understand the replication in working...All of those are either too fast paced that it induces anxiety, or too theoretic to cover all bases, or simply confusing...I'm glad I stumbled upon your video. It finally got home. 🙏
Thank you so much for taking the time to leave a comment! It made my day to hear that the video helped you understand replication. It drove me crazy when I was a CFA candidate, and every year brings a new batch of my finance students who then also struggle with it. You are not alone!
Thanks a million!
Thank you for going through the settings!!!
Thanks for this! it was super helpful
Awesome! Happy I could help! Good luck with your Stata/PCA journey!
Please show how it is done
thank you. explanation is great.
Thanks for taking the time to leave a positive comment! Appreciated!
Dear Sir, I extend my gratitude for the insightful lecture you provided. In my research, I have identified two variables with noteworthy cross-loading factors. The dilemma arises as to which variable should be prioritized for removal, considering their significant cross-loading with Factor 1 and Factor 2. tour4 | 0.7039 -0.5249 ser | 0.7423 0.5641
Thank you for your comment/question! As I mentioned in the video, I'm not a statistics expert. Just a generalist interested in sharing knowledge about using Stata for various analyses. So you need to consider my response below while bearing that in mind. Regarding your specific question about which variable to remove due to cross-loading, a common approach is to consider both the statistical and theoretical aspects. From a statistical perspective, you would most likely remove the variable with the lower communality. (Based on the limited numbers you provided, this might be 'tour4' - but you need to check that column of your results.) However, you should also think about the theoretical relevance of each variable to your research question. Consider which variable is more meaningful to retain, based on your study's objectives and underlying theory. Sometimes a variable with slightly lower communality may be more crucial to keep from a conceptual standpoint. Another option to consider is trying the analysis with each variable removed in turn, and comparing the results to see which solution makes more sense and aligns better with your research goals.
Short but comprehensive. Exactly what I was looking for. Thank you!
Doom scrolling machine..... well said.
Insightful .
Thanks! These techniques can be carried over into a number of seemingly unrelated parts of finance. Timelines really are a student's friend ...
I’ve been challenged all my life with this type of math, especially equations…, dyslexia so I’m told. Thank you for a splendid-clear and useful explanation, I’ll be practicing this for sure! I learned so much from your video. 🙏
Comments like this make the long hours of video creation seem worthwhile again. Thank you so much!
very easy to understand, thank you so much!
Thank you for the taking the time to comment! And I really appreciate the positive feedback.
Wow! That is fascinating. ChatGPT is doing the "Turing Test"! Or, as Alan Turing called it, the imitation game. Excellent video.
Thanks for the positive comment!
Great overview of the TVM and their timeline.
Thank you! Appreciate the feedback!
Is least cost multiple and replacement chain same...?
Oh dear! That is not the right question ... Let me try to explain: LCM (lowest *common* multiple) and equivalent annual annuity (EAA) are two "competing" methods. BOTH of them are grounded in the replacement chain assumption. If there is not going to be a replacement chain, then you can't use either of them. But if there is no replacement chain, then you simply make your mutually exclusive project decision on the basis of NPV.
This has been the most helpful and useful video I've seen regarding converting basis points! Thank you so much!! :)
Awesome! Thank you for the generous feedback!
Hello, can I ask you one little question? Is there a way to create plot using the factors here 9:29? Thanks in advanced.
Remember that you would realistically be limited to a maximum of 3 factors if you wanted to visualise a plot. Here there are 4, which is why the source text used for this video does not try to show such a plot. 4-dimensional plots on a 2-D piece of paper are not strictly speaking impossible, but are unavoidably messy and hard to interpret.
First, I'd like to give you my gratitude for replying. Your answer makes sense as it provides little to no information making plot from these factors. What I had in mind was I tried to make time series graph in which there were plot lines of each factors (X axis is variable time and Y axis is the value of factors loadings). Perhaps there is a tutorial for making such graph? As always, thank you in advanced. @@financefundamentals
What if start up dose not have any such comparable listed company then how we will compute beta
Interesting! If the startup really has no comparables at all, then you would probably need to use something other than CAPM to get your estimate of the cost of equity. In other words: you forget about trying to find a beta. Instead, you could, for example: (1) start with the risk-free rate and add a startup premium; or (2) use the ROI required by VC firms as a starting point. Whatever method you use, I think you should expect to have quite a big number for your Ke, reflecting the very high risks involved. Likely 20% (absolute minimum) - 30 - 50% or even more.
How to do it without a financial calculator???
If the unlisted company does not have debt then how we should calculate in Relevered beta sir
Great question! If there is no debt in the unlisted company (and this is also its capital target) then its D/E for the levering equation is zero. Then the unlisted company's levered beta is the same as its unlevered beta. To see this, apply the levered beta equation: beta(levered) = beta(unlevered)[1 + (1 - t)D/E] = beta(unlevered)[1 + (1 - t)0] = beta(unlevered)[1 + 0] = beta(unlevered).
@@financefundamentals Are you then saying unlevered beta for an unlisted company with zero debt is equal to 1? Therefore equal to the market beta?
@@quyenbui4008 No no no! At step 3 in the video, if the unlisted comapny had zero debt, then its D/E would be zero. Then the unlisted company's levered and unlevered beta would be the same, at 0.846. Why? -> beta(lev) = beta(unlev)[1 + (1-t)D/E] = 0.846[1 + (1 - 0.28)(0)] = 0.846[1 + 0] = 0.846.
Hello sir can you please explain why x11 in the cross loading is eliminated although the value is not the same in both columns. in fact they are close to same, if this is the case then other factors are also close to each other why they are not dropped. Thanks.
[Time stamp: issue starts around 9.55] Take a careful look at all the loadings. Notice that for all variables, except for X11, there is one (and only one) factor that has a high loading. X11 is different. It does not have any loading that is as high as any of the others, with a maximum loading of only 0.6420. But that is not the main problem. Even worse, it has TWO loadings around 0.59 to 0.64. This is called a cross-loading. So X11 is dropped. A cross-loading is NOT defined as two loadings that are exactly the same. Instead you are looking for two or more high(ish) loadings on a single variable, which are greater than your chosen significance level.
What about study material for preparation? Where to get it?
Watch the video from 4:07 ...
Wow this is so interesting. So do you think that ChatGPT is/was bullshitting us? Or made a mistake, or hallucinated? Or knows something we don’t? 🤔 Always trust but verify! This only gets harder and harder with time.
Thanks for the feedback! Verification is absolutely the right approach. AI is developing so fast and has come a long way since I made this video in January, but it most certainly still has a *BIG* B.S. problem! Let the user beware ...
thank you
You're very welcome!
Great video. I’m glad you took the time to figure out how ChatGPT might have come up with that false reference. I’d be curious to know if ChatGPT would self correct if you asked it to produce a list of papers by Wald in that journal from 1947 within that same chat thread.
Thanks for the positive feedback! And a great follow-up idea too. Things have moved on fast since I published this just a few months ago, and it would be really interesting to see how the newer AI models deal with this issue.
Correction at 00:55: The Level 3 exams are in Feb and AUGUST each year.
How do you use the loadings to create an index please?
There are a number of methods. I personally have used the approach in Anderson, TW and Rubin, H. 1956. Statistical inference in factor analysis. Proceedings of the Third Berkeley Symposium on Mathematical Statistics and Probability, 5:111-150.
Thank you!
I would like to echo GG's comments. Your explanation is very intuitive especially due to the simple play with the " R = S - F " equation. Thanks a lot for this video. I will definitely check out your other videos.
Thank you for your kind words! I’m really glad you found the video helpful.
really great video, thx for taking the time.
Thanks for the positive feedback!
I wonder why no one comments. This illustration is one of the best thing ever happens for a stupid CFA candidate like me.
Thanks! What an awesome comment. I feel humbled!
How was ur exam?..I am may 24 candidate
I had a similar experience with ChatGPT while looking for references and books. Sometimes it gave me real papers or books and other times the sources were completely fabricated.
It's going to be an unpleasant surprise for any students who submit AI-generated work for grading, without fact-checking it first! Hopefully the professors will be vigilant!
😉
good one , liked n subbed , thx for your work
Thank you!
Very interesting dive into the logistics of making a CFA Level 1 Exam happen! I'm curious of two things: 1. Since some individuals without finance backgrounds at all are able to study and pass the exam, would the gaps in knowledge be too large for a student still early in their degree, assuming they have ample time to study. 2. Im not certain how it works in South Africa, but I am from Canada and many universities have streamlined "co-op programs" that students partake in during the later part of their degree program. Therefore I'm curious if one were to write their CFA Level 1, but then there was something that came up (ie. deciding to do an internship) that extended their degree 6 months or a year, they would then have written the exam more than 23 months ahead of their graduation date. Would CFA nullify your Exam?
That is a very good question! And I don't know the answer. CFAI says this on their website: "Your selected exam window must be 23 months or fewer before your graduation month for your bachelor’s degree or equivalent program. Understand that you must complete your degree program prior to the date of sitting your Level II exam." Say you register in good faith for your Level 1 exam 23 months before your *expected* grad date and pass. Then your circumstances change, and you only get your B degree after the 23-month window has closed. The delay could be for reasons that you do or don't control. Does your Level 1 pass get voided by CFAI?
Great explanation 😊
Thank you!
Nice
Thanks!
What app do you use for your text capture Mark?
The software is Sketchbook Pro, using a Huion graphics tablet.
Thank you so much for being so precise in your explanation. It's a treat to watch and makes understanding easy.
Thank you for the positive feedback!
Awesome video!!! Thank you!
Glad you liked it! Thanks for taking the time to leave a positive comment!
Thank you sir!
You are most welcome!