CFA/FRM: How to Calculate Covariance Using Texas Instrument BA II Plus | FinTree

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We love what we do, and we make awesome video lectures for CFA and FRM exams. Our Video Lectures are comprehensive, easy to understand and most importantly, fun to study with!
This Video lecture was recorded by our Lead Trainer for CFA, Mr. Utkarsh Jain, during one of his live Session in Pune (India).
To know more about CFA/FRM training at FinTree, visit:
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[@gradoscapital]

This video SAVED me a lot of headache calculating manually. Seriously, thank you!!!

[@alejandrorabinovich5863]

This video should have more likes! Simple, efficient and time saving. Thx!

[@ShadowSamurai192000]

Much appreciated, thank you for this video. Very good explanation for the CFA exam.

[@RahulA-xn9kp]

🎯

[@pritamghanghas1706]

Amazing sir! Much appreciated!

[@mgu5929]

amazing video!! life changing 4 sure

[@ogbodoamos3040]

Amazing! Thank you Genius!

[@rohyiturri2459]

Amazing sir!, thank you!

[@muntaquirhasnain5256]

Thank you sir..

[@megaAditya95]

Thank you sir really helpful

[@olamoyegunoreofe]

This Video is very Helpful. Thanks

[@thepubliceye263]

Brilliant. Thank you.

[@lachlanwilliam7213]

Legend!

[@helenwolf6205]

this is great! thanks!

[@federicorea2217]

YOU ARE AMAZING! Thank you!

[@RahulA-xn9kp]

Seriously

[@sabeenashaji2008]

great tip

[@sohaamleenajumde1022]

amazing, thanks

[@alka3341]

Holy shit! Thank you so much!

[@uchennaude9121]

thank you sir. very helpful

[@ankitgoyal7284]

Hi Sir,
This video is very helpful.
Can you also provide how can we calculate MAD(Mean Absolute Deviation) using this calculator ?

[@rahulrajani1996]

Thanks alot sir for the valuable guidance. Further, I saw a book on your table on coffee can investing is it worth the read?

[@harshil1706]

Thank you, much appreciated. Great hack.

[@RahulA-xn9kp]

O

[@yuanqinglu7406]

Thank you very much!!! The best video

[@RahulA-xn9kp]

Fine

[@jatinbarodia7039]

Genius.

[@ShivamSharma-bk4od]

Thankyou sir😇

[@adityakwatra2279]

good one sir
is there any method of calculating variance and standard deviation of two portfolios (reading9)

[@gauravkaushikable]

Please post something on volatility, Correlation copulas...

[@akshaydarade3471]

Thank you

[@sajjadhossainTheBestOfTheBest]

Sir for calculating the covariance are we supposed to take sigma x * sigma y * r or Sx * Sy * r from the stat function? I have seen some other videos for instance Kaplan Schweser calculator tutorial videos that use Sx * Sy * r for calculating the covariance. Would you please clarify?

[@AmanYadav-dd3zc]

you just made life easier

[@RahulA-xn9kp]

Wait

[@gauravmusics]

Thank you so much, very helpful 😊

[@RahulA-xn9kp]

🎉

[@iamnotbajirao]

Thanks for the video. Please can you also post list of books to read to supplement knowledge gained from CFA/FRM exams.

[@RahulA-xn9kp]

Definitely Sir

[@ishu3194]

I just wanted to know how did you assumed number of observations ?

[@kartikmakhija6584]

Hello sir. Thank you for the information. I would request you to please share Copulas video, it's pretty confusing plus FRM exams are approaching soon. Will be greatful.

[@RahulA-xn9kp]

Howdi?

[@nareshnehra9398]

what if the weight is in decimals like 1.2, 3.3, and 0.5 instead of the usual 3, 1, and 1?

[@DeniseDirect]

Can you tell me why my PCT button will not compute on this type of calculator?

[@giammi2256]

🙌🏻🙌🏻🙌🏻

[@justhuman1225]

genius

[@Moink2209]

What is the difference between LIN and 1-V? Some people refer 1-V. Which one is correct?

[@FintreeIndia]

1-V to be used when you're dealing with a single variable with probabilities/weights attached

[@surbhisingh5731]

Hello all, I am new to study these concepts in example 2 i am facing difficulty, I cant find values of sigma y and r. Am I missing something can someone help?

[@hamzah1akhtar]

Have you found your answer yet? ... You need to make sure that you have your calculator set to LIN (This will be displayed when it is in the STAT mode). To adjust to LIN, press the following sequence until LIN is displayed: '2ND', 'Enter'.

[@tapanpaul9111]

Thanks...9icccccccccccccccccccccccccc.

[@sallom432]

financial sorcery :O

[@mamad5418]

why did we use 5 as a number

[@danielbeheshti3890]

what do you do when you have odd an even numbers/ example: 60%, 25%,15%? now its difficult

[@rohitsachdev3457]

change the total observation like in this make total 20 observations and put 12,5,3

[@RahulA-xn9kp]

True

[@dariohernandez1219]

Crack!!

[@shripadkulkarni6016]

Thank u so much sir....I have one doubt that how to clear stored memory?
And please upload video realtive to quants calculation

[@FintreeIndia]

When you store any value previous ones get cleared automatically, but still, you can do 2nd MEM and 2nd CLR WORK, For more video please visit www.fintreeindia.com/

[@mohamedshamakh]

Hey, I have an easier way and I thought to share Co Var= E(XY)-E(X) E(Y). These are weighted average for XY product, weighted mean for X and Weighted mean for Y. I use HP12 C and I have to enter the data 3 times to get the weighed averages, I was watching to see if you have a faster way. Thanks for the wonderful Videos.

[@evacuizon5792]

Could you please share how to compute the given problem using such formula?

[@snigdhaagrawal]

Sir i m ur student. I applied this to simple covariance joint probability question given in schweser 2018 pg 183 it worked. But same is not wrking for portfolio covariance q pg 187. So this wont work for portifolio questions??

[@SushantMishra1996]

obviously not. Covariance of numbers and portfolio are not entirely different things but understood very differently! Covariance of portfolio depends upon the weights of the constituent bonds or stocks(calculated as market price of bond/total market price) and standard deviation/volatility as well as the correlation. Please google it and you'll find the mathematical formulae for covariance of two asset portfolio which can be extended to more number of assets.

[@Black182heart]

I think just calculating directly following the formula will save more time than doing this.

[@erikbeier9515]

For the questions giving a bivariate pdf and asking for covariance, it may be quicker to use:
Cov[X,Y]= E[X]*E[Y] - E[X*Y]

[@evacuizon5792]

Could you please share how to compute the given problem using such formula?

[@RahulA-xn9kp]

😮