CFA Level II case studies
CFA Level II · Put your knowledge to work in context.
The CFA® Program Level II exam is the second of three levels in the CFA Program, the chartered financial analyst credential administered by CFA Institute. It is aimed at candidates who have already cleared Level I and want to move toward the charter, and it is built for people preparing for roles in investment analysis, valuation, and portfolio management. The CFA Level II case studies are 5 cases and about 3,214 words.
1IPO Allocation and the Pull of Commission Revenue
Priya Raman is a portfolio manager at Meridian Wealth, where the written IPO allocation policy states that oversubscribed issues are distributed pro rata across eligible discretionary accounts in proportion to order size. A new issue is 3.2 times oversubscribed.
684 words, about 3 min2Capitalized Development Costs and a DSO Spike at Kestrel Industrial
Kestrel Industrial reports revenue of EUR 1,000 million, net income of EUR 100 million and cash flow from operations of EUR 60 million. The company capitalizes product development costs: EUR 120 million was capitalized this year, while amortization of the cumulative capitalized balance included in current expenses was EUR 60 million.
630 words, about 3 min3Residual Income at Corvane AG: A One-Time Gain and a Clean Surplus Break
Analyst Tomas Brix values Corvane AG with a single-stage residual income model. Beginning book value per share is EUR 25.00, reported EPS EUR 3.00 and dividends EUR 1.20.
653 words, about 3 min4OAS, Option Cost and a Volatility View in Two Issuer Bonds
Nadia Okafor compares two senior unsecured bonds of the same issuer, both maturing in 10 years. Bond X is callable at 102 beginning in year 3; Bond Y is straight.
623 words, about 3 min5Halden Foundation: Required Return, Smoothed Private Equity, and Capital Calls
Trustee Ana Duarte reviews the EUR 500 million Halden Foundation. Spending policy is 5% of a three-year average market value; inflation is 2.5%; all-in fees are 60 bp.
624 words, about 3 min