MAFF study plan

Build a one-page formula sheet for time value of money, net present value, internal rate of return, and descriptive statistics (mean, variance, standard deviation, covariance, correlation), then solve ten numeric drills from memory without notes.

Compute and interpret holding period return, arithmetic versus geometric mean return, and money-weighted versus time-weighted return on three constructed price series, writing one sentence on when each measure is appropriate.

Derive the capital asset pricing model relationship from the security market line and explain in writing how beta, the risk-free rate, and the equity risk premium each shift expected return.

Distinguish nominal from real returns and arithmetic from compounded growth, and convert between them for a five-year series with 3% annual inflation.

Set up a spaced-repetition deck of 40 flashcards covering Domain 1 definitions and formulas, tagging each card to the learning outcome it serves.

Walk through a full three-statement model for a single company: build the income statement, balance sheet, and cash flow statement from a list of transactions, and verify that the balance sheet balances and that net income ties to operating cash flow.

Classify twenty line items as operating, investing, or financing activities and justify each classification in one line.

Compute common-size income statements and balance sheets for two years and identify the three largest structural shifts in margins and asset mix.

Calculate and interpret the core ratio families (liquidity, solvency, activity, profitability) and explain how one ratio choice can distort comparison across firms with different capital structures.

Explain the mechanics of revenue recognition, inventory cost flow (FIFO versus weighted average), and depreciation method choice, and show numerically how each changes reported earnings and cash flow.

Detect earnings manipulation signals: compare accruals to cash flow, examine receivables and inventory growth against revenue growth, and flag at least five red flags in a constructed case.

Compute free cash flow to the firm and free cash flow to equity from a set of financials, and reconcile the two starting from net income.

Apply the DuPont decomposition (three-factor and five-factor) to two firms and attribute the return-on-equity gap to margin, turnover, or leverage.

Explain how accounting policy differences across jurisdictions complicate cross-border ratio comparison, and adjust at least two ratios for comparability.

Build a discounted cash flow valuation end to end: forecast five years of free cash flow, estimate a terminal value with both the perpetuity growth and exit multiple methods, and discount at a computed weighted average cost of capital.

Compute the cost of equity with the capital asset pricing model and the cost of debt after tax, then weight them by target market-value proportions and explain why book weights mislead.

Run sensitivity tables on terminal growth rate and discount rate, and state which assumption drives the widest valuation range.

Value the same company with relative valuation (price-to-earnings, enterprise value to EBITDA, price-to-book) and reconcile the multiple-based and discounted-cash-flow results.

Explain the Modigliani-Miller propositions with and without taxes, and describe how leverage changes the cost of equity and the weighted average cost of capital.

Compute net present value, internal rate of return, payback, and profitability index for four mutually exclusive projects, resolve a conflict between net present value and internal rate of return ranking, and justify the decision rule chosen.

Evaluate capital structure and dividend policy decisions: compare a share repurchase with a dividend at the same total payout, and quantify the effect on earnings per share and shareholder wealth.

Price a bond from its coupon, maturity, and yield, then compute modified duration and convexity and estimate the price change for a 100 basis point shift, checking the estimate against a full repricing.

Explain the yield curve shapes (spot, forward, par) and derive an implied one-year forward rate from two spot rates.

Distinguish the main fixed income risks (interest rate, credit, liquidity, reinvestment, inflation) and map each to a specific instrument characteristic.

Apply dividend discount models (Gordon growth and multistage) and the free cash flow model to value an equity, and identify the conditions under which each breaks down.

Compute and interpret the major equity multiples, and explain the effect of leverage and accounting differences on comparability.

Compare equity and fixed income on expected return, seniority, claim on cash flow, and volatility, and explain the role each plays in a portfolio.

Price a call and put with the binomial model on a two-period tree and verify the result against put-call parity.

Explain how duration, credit spread, and embedded options (callable, putable, convertible) change a bond's price behavior.

Compute portfolio expected return and variance for a two-asset and three-asset portfolio, and show numerically how correlation changes the efficient frontier.

Construct the capital market line and the security market line, and explain the difference between systematic and unsystematic risk and why only the former is priced.

Compute and interpret the Sharpe ratio, Treynor ratio, information ratio, and Jensen's alpha for three portfolios, and explain when each measure is misleading.

Measure value at risk with the parametric and historical methods and explain the limitations of each, including tail risk and non-normality.

Describe the behavioral biases most relevant to portfolio decisions (overconfidence, loss aversion, anchoring, herding) and one structural mitigation for each.

Apply the code of ethics and standards of practice to ten constructed scenarios, identifying the specific standard at issue and the required action.

Distinguish the fiduciary duty of loyalty and care from mere suitability, and explain how conflicts of interest must be disclosed, mitigated, or avoided.

Explain the standards on material nonpublic information, market manipulation, and fair dealing, and identify the compliance control that prevents each violation.

Complete two full-length timed mock exams under exam conditions and log every miss by domain and by error type (knowledge gap, misread, calculation slip, time pressure).

Rework every missed item from both mocks into a one-page error log and re-solve each without notes to confirm the fix.