April 2007 Exam

Err did anyone else find that exam the most awful three hours imaginable? (Please tell me you did!)

I thought I was so prepared but none of the easy marks were there. No implied volatility. no stating assumptions. I couldn't even do the variance of return question which is usually the easy marks on the paper (did they forget to state the distribution of t or did I just miss something really obvious? )

Sorry I know this post is totally pointless as the exams over etc etc, but I can't stop being paranoid and I don't know anyone who took it that I can pester!

 

Hi Jenny,

Well believe me you were not the only one who found it difficult. Where were the nice easy marks?! Even the nice topics had really tough questions!

I think most people found it difficult. I have spoken to a few people who really think they messed up. Well, easier said than done but best to forget about it now and hope for the best!

Goodlucuk!

 

Don't worry too much about it now that it's over - I find that sometimes a tough paper can work in your favour.

I passed this subject when it was the old 109 and they set a really horrible paper. Was absolutely convinced I'd failed as there was a tough 20 mark question at the end all on corner portfolios as well as other nasty questions.

With all the tough questions I just put down what I knew and some outline notes on a method I would perhaps use to solve the problem (without actually solving it) and making some effort rather than doing nothing probably worked in my favour on the harder questions.

So...don't lose hope just yet!

 

Guys do not panic - I havent sat this but when I sat on the old 100 series I had a horrible paper.

Normal Theory in Actuarial exams is - If the paper was overall easy/fair then you got to worry! If you found it hard that means higher chance of passing! You just need to compare with all others who sat the paper!

 

Jenny are you talking about question four? If so here is what I did ... I could be wrong, who knows!

The question went something along of the lines of some dude is thinking of investing in something with payoff R with pdf

f(t) = 0 for t < 0.5

and

f(t) = c/t^4 for x => 0.5

with c = something and cost = 0.7.

The mean of the net payoff, or whatever it is called, can be worked out as
E[R] = E[t-0.7] = integral from - infinity to infinity of (t-0.7)f(t)dt

then you split this up into two integrals between -inf and 0.5 and 0.5 and +inf and one is zero and evaulate the other.

Then you can work out the semi variance using the mean you have now and some tricks. And again similar for the value at risk.

If this wasn't the question you were refering to then oops and the only other similar type question just involved the lognormal model distribtuion and some rearranging and evaluating.

If this question didn't appear on the paper and I am just making it up then it's an even bigger oops..........

I hope you guys do ok!

 

Thanks. Yeh I see I messed up a bit.. Oh well i dont think it was worth much. I didn't think to integrate. Grr..!

Oh well.. Better work extra hard for the next exam!

 

This was actually an OK paper. I have spoken to quite a lot of people they tell me that the questions were tough but they managed to still answer them. I guess if you were prepared properly i.e. you understood all the topics rather than just learning how to do past exam questions then you should have been fine.

I think a problem with these CT series exams is that a lot of people just do exams papers and just learn how to do the questions in the exam papers without understanding the topics properly. So when you get a question that you have not seen before you struggle with it even though the question is easy.

So the key to passing is to do the exam papers so that you learn how to do common questions that always come up but to also properly understand all the topics so that you can apply that understanding to any questions.

 

ho hum....

Well I thought that was awful too. I got the integration bit (variance of return) etc but the state price deflator stumped me totally. The Covariance question (for which I assume the answers had lots of sigmas in!) was a no go for me.

The problem with CT8 is that its so bitty. There's just lots of bits of everything all chucked into one syllabus (the extra chapter this year NOT helping) and if you happen to have learnt the wrong bits then you've no chance in the exam. It's just luck of the draw what questions happen to come up.

Thank goodness we get 4 attempts!

Best of luck everyone with the results.

 

Errrm... you were meant to learn all of it.

 

ha ha how big is your brain! I note from the comments above that everyone learnt about the fractal dimensions then!

It is a very big syllabus. I think it would be a little tricky to learn (and retain) every single detail in it.

 

Well you know what they say about guys with big brains

 

Big Hats?

 

yes

they are all horlicks drinkers