Level I CFA: Quant The Time Value of Money-Lecture 3
HTML-код
- Опубликовано: 27 июл 2024
- This video is valid for both 2020 & 2021 CFA exams.
This CFA exam prep video lecture covers:
Present value of a single cash flow
Present value of a series of cash flows
PV of an ordinary annuity using formula
PV of an ordinary annuity using calculator
Annuity due
PV of annuity due using the formula
PV of annuity due using the calculator
Present value of a perpetuity
PV of a series of unequal cash flows
Practice questions
For the Latest "Quantitative Methods" Full Videos and other Free Materials - Just click here: ift.world/pass-cfa/
Subscribe now: ruclips.net/user/arifirfan...
For more videos, notes, practice questions, mock exams and more visit: www.ift.world/
Visit us on Facebook: / pass.with.ift
Active learning is proven to increase understanding and retention by 3 times! To master the Level I Curriculum in 3 simple steps - visit: ift.world/active-learning/
Hi what this PV in annuity end means. Like the person had invested certain amount and keeps on adding x amount each year end
Hello.
Point 6.4 The present value of a series of unequal cash flows.
Can you please explain in detail the formula used.
Explanation in video is that we have to find PV of all and then add them.
But 1 have tried 3 times with different ways but ans is not coming 550.
Can you elaborate the formula and values which came after using those formula
Excellent video 👍🏼
God bless you for doing this
Thanks for your kind words.
IFT Support Team
very practical skills, thx so much for sharing it, finished
You are welcome!
IFT support team
Why dont you just use CF function on the calculator for the ordinary annuity and anuity due ? Isn't it faster?
Dear Christian,
External: Yes, you are correct. This lecture explains the concepts behind that "CF" and other calculator methods, understand the concepts and then use calcutor for better understading.
IFT Support Team
Hi Sir, I still try to comprehend why the PV is always for one period before the first cash flow.
First understand the difference between ordinary annuity and annuity due.Ordinary annuity: A series of equal payments or receipts occurring over a specified number of periods with the payments or receipts occurring at the end of each period. For an ordinary annuity, future value is calculated as of the last cash flow, while present value is calculated as of one period before the first cash flow.Annuity due: A series of equal payments or receipts occurring over a specified number of periods with the payments or receipts occurring at the beginning of each period. For an annuity due, future value is calculated as of one period after the last cash flow, while present value is calculated as of the first cash flow.IFT Support Team
Sir IN Annuity Concept where the calculator is in BGN Mode. I entered value as showed i didn't find the exact same answer. Where i tried it on End Mode using N =4 i got the answer 45.45. Can you please help me out on that confusion or what i might be doing wrong
PV is 45.46 using BGN mode; please follow the instructions for calculator or use our tutorial on calculator.
IFT Support Team
Sir, at time 25.49mins, you forgot to mention the N=3---- your fan
it is mentioned that we discount back to the power of 3. Thanks for your feedback.
IFT Support Team
For ordinary annuity in BA II calculator ,I am getting PV = 45.45. Can any please tell me why I am getting error in calculation of ordinary annuity?
Dear Ashish,
Please visit this link for CFA Exam Calculator Tutorial Videos.
ruclips.net/p/PLcmt2ZfkV0M0dSzAT9583TZOmD97wQcB4
Please watch these videos carefully.
IFT Support Team.
If annuity is a set value then why are we talking about rates
Hello sir..! Sir I have a great confusion in these things please help me :
In case of perpetutiy
pv=pmt/r so here pv is calculated at the beginning of yr ? And it's always like that? I mean pv in this formula is calculated at the beginning of the year??
Because in normal cases pv is calculated at the end of the yr
Right?
basically, in this case we are dealing with Present Values Indexed at Times Other than t = 0. An annuity or perpetuity beginning sometime in the future can be expressed in present value terms one period prior to the first payment. That present value can then be discounted back to today’s present value.
IFT Support Team
I have question from your volume 1 notes Reading 6 practice question 3
Please check the answer for EAR.
Dear Sapna,
We have checked and the calculations are correct, there are no errors.
IFT Support Team
Hey is this all videos sufficient for clear level 1or not?
yes brother but in addition if you will buy the high yield package there is higher probability of your to crack the exam
very well explained
Dear Darshit,
Thank you for your very nice comments.
IFT Support Team
I feel like the present value of perpetuity wasnt well explained. i still dont understand
At 9:59 you get an ans of AUD 32,760 but I computed the same values on my fin calc and got an answer of 32,825.49 AUD. I had a similarly small variance in one of my other answers too, but why is that so?
Its because maybe you have rounded off 4%/12........(4/100*1/12)
Sir I didn’t understand the topic of unequal cash flow, could you please elaborate?
Dear Lampard,
Please watch our calculator tutorial video, in those videos we have explained how to calculate FV of uneven cash flows using the calculator.
IFT Support Team
the answer for 17:03 is incorrect the answer is 58.01 if you use the formula he displays
Can you please explain example 16 from the curriculum. It needs proper explanation
Can you please let us know which specific calculation you did not understand and needs clarification. Because the example is simple. You need to calculate the present value of a four- year ordinary annuity of £100 per year starting in Year 1 as the difference between the following two level perpetuities:
Perpetuity 1 £100 per year starting in Year 1 (first payment at t = 1)
Perpetuity 2 £100 per year starting in Year 5 (first payment at t = 5)
IFT support team
SORRY, DON'T UNDERSTAND QUESTION 9.
Dear Felix,
In Q9, you need to calculate PV of 1 Million at the end of Year 3, i.e., when Nathan’s college begins.
IFT Support Team
@@IFT-CFA sir, in Schweser book 3 years from now means you get the PMT at the end of second year. That is why they calculate PV2 not PV3. That is in question 9 N is 10 , but you take it as N9 which one is correct?
@@MrRufatti exactly my question. It should be10 bcz his admission is at the beginning of the year and not end of year. So pv2 should be the actual value and not pv3