Professional Documents
Culture Documents
Formula Sheet
%
!"# #
$"
5.
PV =
-1
!"
&'( #
L
G[&
FVOA =
G 1 +
%
%^_ #
(
1/G
&'( # /&
(
(- /.1
.
7 =
FVN = 1 + 1
FV (for more than one Compounding
per year) = FVN = 1 +
(- .1
.
Solving for N =
B1
CD
ED
B1 &'(
(where LN =
natural log)
Stated & Effective Rates
Periodic i Rate =
FGHGIJ
KLL
M
NHGI
6.
PV of Annuity Factor =
HPR = rt =
PVAD =
&/
%
%^_ #
FVAD =
1 + L
3. HPR =
Q!
gNN
$%
/$h '
i%
$h
)"h
opf $H(/$(MaI
(1 + ) =
_1
%
m
+ PMT at t =
FVOA (1+r)
Q!Z
L
G[& &'( Z
)"h
)"% /)"h
PVOA + PMT
)"% /)"h
%
_- b#
b
_b
= 0 (IRR
5. TWR:
TWR (when no external CF) = rTWR =
$"
%^
Q!
*
M[f &'gNN Z
$)*
PV of Perpetuity =
&/
4. MMWR =
4.
$)*
L
G[& &'( Z
PVOA =
2. PV and FV of CF =
=0
$H(
L
(qr
opf
$%
/$h '
i%
$h
rMM = HPY
rMM = (rBD)
opf
G
FinQuiz
rMM =
Formula Sheet
opf
(qr
opf/ G (qr
(Rule: rMM>
rBD)
10. Bond Equivalent Yield = BDY =
Semiannual Yield 2
Reading 7: Statistical Concepts & Market
Returns
1. Range = Max Value Min Value
2. Class Interval = i
z/B
{
where
i = class interval
H = highest value
L = lowest value, k = No. of classes.
K|7OwSGI !(I}SILa`
median at
# /
%
% /
L/&
m /
%
& k L
!O( Hww
/
L/&
!O( Hww
%
m
%
L/&
=
21. Semi-var =
with M > 0
for i = 1,2,.,.,n.
!O( Hww y
/
L/&
/y
L/&
where n =
Quintiles =
Deciles =
Percentiles = Ly = + 1
&f
!O( Hww y
/y
L/&
F
iM7G(M|SGMOL
u
iM7G(M|SGMOL
iM7G(M|SGMOL
,
`
&ff
L'&
% /
*OGHw 1O OP U|~7
FinQuiz
Formula Sheet
"H(MHLaI OP N
*OGHw $(O|
$(O|
OP
&/$(O|
OP
&/$(O|
OP
$(O|
OP
$ Ky
$ y
P(B) 0.
L
M[&
M M
&k M + kk k + ok o
14. Correlation (b/w two random variables Ri,
Rj) = M =
QO~
N N
N N
$ 1I gLPO(.HGMOL|~ILG
$ 1I gLPO(.HGMOL
.
16. Multiplication Rule of Counting = n
factorial = ! = n (n-1)(n-2)(n-3)1.
17. Multinomial Formula (General formula for
labeling problem) =
L!
L% !L !L !
L
(
L!
L/( !(!
L!
L/( !
1
L/
L/
==
L!
L/ !!R
(for x = 0,1,2.n)
FinQuiz
Formula Sheet
7. Sharpe Ratio = =
NE /N
E
|/H
0
F(x) =
=
/H
|/H
< <
/(/)
k
the interval
o
+ f,& = And
=
k f,* = k
S.D. = (r0,T) =
16. Annualized volatility = sample S.D. of
one period continuously compounded
returns
Reading 10: Sampling and Estimation
1. Var of the distribution of the sample mean
=
FinQuiz
Formula Sheet
known = =
7
L
where s = sample
k k
'
where N= population
7.
% / / % /
2.
3.
/h
4.
= H/k
F
L
x
8. Z-ratio = Z =
/ n
/h
m
5.
L/& =
/h
m
8.
%/
% '
m% m
%
'
m% m
m%
m
'
m%
m
In this df calculated as
where = & + k
2.
where Rk = pooled
%/
L% ' L /k
L/&
% / / % /
m% m
% /
6.
1. Test Statistic =
S.D estimate of s =
1/L
x
s/ n
t=
9. t-ratio =
&
L
FJ
L
M[& M
sample variance = Jk =
sample S.D =
Jk
h J% /J
L/&
FinQuiz
Formula Sheet
8.
F
L
population variance) k =
1 =
k =
9.
L/& F
h
where
h /
L/&
L/& F
L/& F
%/
F%
F
distribution = =
&k
"
&ff
&'NF
RS =
where:
where
R
axHLTI7
iOL
axHLTI7
100
"
7.
% = 100
Q/B&
z&/B&
where:
FinQuiz
Formula Sheet
Q2 Q1
1
%Q 2 (Q1 + Q2 )
=
P2 P1
%P
1
2 ( P1 + P2 )
9. Income Elasticity of Demand =
%
%
Q2 Q1
1
%Q 2 (Q1 + Q2 )
=
I 2 I1
%I
1
2 ( I1 + I 2 )
&'
"
&'
"
!
"
#$
FinQuiz
Formula Sheet
! )*
!
)*
Variable Cost
14. Marginal cost (MC) =
!
#$
-,
&'
2$
#
2
#
3. Concentration Ratio =
-,
$$ *$ 2 '$ &f $
!
+,
#$
&' -,
/ 01$
!
-,
! &1 $
FinQuiz
Formula Sheet
100
4. Real GDP = [(Nominal GDP / GDP
deflator) 100]
5. GDP deflator =
/
)
100
FinQuiz
Formula Sheet
7 #$
100
Inflation Rate =
&ff
4. Velocity of money =
/
&
MPS = 1 MPC.
Total increase in income and spending
= Fiscal multiplier G
Fiscal multiplier =
&
&/)$Q
&/G
9$
$
FinQuiz
Formula Sheet
S/R
S/R
#R
#S
V<
$
&f,fff
$ /
&
!
FZ^%
FZ
1 = %G'& =
M /M
&'M
M /M
&'M X
(where is quoted
%
%
&
!/
$ /'(< $/&f,fff)
F/
S/
&
1 + J = 1 + P
S (P /P )
6. Points on a forward rate quote = Fwd Xrate quote Spot X-rate quote
U
&' R
UR
U
&' S
US
5. Direct Quote =
C = Y - Sp =Y+R-T-Sp And,
CA = Sp- I+ Govt surplus (or Govt saving)
= Sp- I+ (T- G- R)Sp + Sg = I + CA
&'M
&'M
&'M
&'M
FinQuiz
M=share of imports
M =price elasticity of domestic country
demand for imports
Formula Sheet
Cash receipt
14. Net Profit Margin =
#$/)$
+
7$
"$
-
/
)*
balance method) =
Reading 24: Financial Reporting Standards
/
/
*$
0'2
8*'
/
$2$
$'
/
0'2
8*'
/
$2$
/$'/<
$2$
2
<
2*
,
$$
*$
! 2
method =
Acceleration
$$
)*
FinQuiz
Formula Sheet
#
8$$$
#
-,$
#$2'&1,
$$
#
-,$
14. Debt-to-Equity =
15. Total Debt =
!
,
!
7C
! ,
! 8$$$
!
8$$$
!
7C
FinQuiz
Formula Sheet
#V.'$ '!9$
)*
28. Reinvestment =
#V.
#$2
'/
$$$
^ $2 &
#V.
#$2
-!
,
8. Inventory turnover =
#$
$$
$
'$
$
#V.
^' +
21. CF to revenue =
22. Cash ROA =
23. Cash ROE =
#V.
/
)*
2. Combined ratio =
#V.
8*'
!
8$$$
-$$$
79$$
/
7
#V.
.'
/ $
)*
8*'
)*,$
/
$
)*,$
*
3. Operating ROA =
.'
4. ROA =
$
!*
ghi
jkl
8*' ! 8$$$
#V.
8*'
$22$_ C
7 +
8*' *
*$
/
8*'
!
8$$$
or
ROA =
/
'$
79$
&/!9
2$
8*'
,$
/
$
,$
!*
8*' ! 8$$$
#V.
!
,
!9
15. WC Turnover =
)*
8*'
0#
7'$ , !9
)*
8*'
/
V9
8$$$
FinQuiz
Formula Sheet
)*
8*'
!
8$$$
) &1, $
#V./# 9/*$
$ -,$
! ,
VV./*$
! $ 7' 8$$$
# 9
20. ROE =
/
8*'
!
7C
)*
Income =
) )*
! ,
/ )$ $
! ,'7C
/
)$
/
)$
*,
7^!
$$
$
7^!8
7^!
!8
#8/#!8
+ 0.6
$$ $
. /
8*' /
7^!
8*'
#
7^!
!8
&+
$1
^+
,$
'
)*
'
8$$$
'
(-$$)
'
8$$$
'
-,$
'
8$$$
Reserve Ratio) =
)$*$
2
$
#
^1
$
-,$
VV.
!
,
+ 1.0
' )*
.
)*
8*'
)*
' (-$$)
).7
!8
+ 1.4
$$ $
.
.'
8*'
.'
7^!8
! ) C &$
8*' # 7C
! ,
#V./#
79
!
,
FinQuiz
Formula Sheet
7$
"$
-
n$
#$/7$
)$
$*' +
7$
"$
-
2
7$
*
#
FinQuiz
Formula Sheet
8'''
,
*
4.
20. Cost of sales = Carrying amount of the
leased asset PV of the estimated
unguaranteed residual value
)
#V/#
9
!
,
FinQuiz
Formula Sheet
!',
^+
NPV =
t=1
) ,'+ ' $
8
$$
7
) 8$$' + ' $
8 9$
! # -$ $
Total Future
/
7
(
)
8
9$
$$
7
8
9$
8*' / & 9$ , $
4. PI =
8*'
^+
*$
+
#V$
.
=1+
/+
.
/ $ $ $
1
p
8m$
^+
IO
) 7C
) ,'+ ' $
AT CFs at time t
1
*
2
#$
1
FinQuiz
Formula Sheet
%
h
+g
8
.
7C
9
8
.
$*'
,
&1
$
*
1
) ROE
< $ 2 $
%
h /V
13. H77IG =
% "$
DOL=
5. DFL =
#&
#&/
V9
.'
#$
%
/
%
.'
#&/
V9
.
#$
or
%
h /V
+g
6. DTL=
%
/
%
/
"$
#&
= DOL DFL =
#&/V9 . #$/V9 V #$
1 R(O
% .' 7^!
#&/V9 . #$/V9 V #$
R(O
R(O
Z
&' &/G
4. DOL =
+g
or
8 <22 $_ $ $
&' &/abdvc
18. Breakpoint =
", =
FinQuiz
Formula Sheet
# $2$ /$
#
$2
$2
*$
/
*,
$2$
2$ /$ , *
#
$2$
/$
(&+
$2
<2
2
2$]
( #
$2$
/$/#
$2$
(
,
2$
,
#
2$ /$ *
V
*/2$
2$
opf
/ $
2$
opu
8*' V
8*'
$
8*'
V
aw
azw
aR
cf
jcbafewcS
`a
aR
j{f
ghi
$
&/$
7. Float Factor =
- 8
$
/
$
/ $
- /$
5. Discount-basis Yield =
9. EPS after buyback =
7'$/8
9
#$
V$
2$
.$'
^,1
V
*/2$
V
+
opf
/
$
$'_ $
$$'^1
$$
-
/$
FinQuiz
Formula Sheet
1 + & 1 + k 1 + L
*
G[& MG
7. IRR =
8
,
*$
2
V
&
15. (1 + Real R) =
/ $2$
/8+ ! * & V
! #V
!
[f &')) w
&
Ann R = (1 + Monthly R) 12 1
52
w /w%
3. Dividend Yield =
e%
NZ /
)w /)
!/&
ij i j
w%
Ann R = (1 + Quarterly R) 4 1
Ann R = (1 + Weekly R)
(&')
=0
(&'/ ))
1 + r 1 + E 1 + E RP
&
k
Var of Invest
FinQuiz
Formula Sheet
7 )e /)R
e
E R =
/
[& E
(//&)
(//&)
/
7 )c /)R
c
7. Assets Beta =
#
,<
$$
1
..
8$$
>
8. Portfolio Beta = =
[& w ; [& w = 1
11. M = R $ RP
7 )b /)R
b
<,
6. R =
P
+ R . P =
= R + w& & + wk k E R R
! &1 )$1
= M . P +
! )$1
9. Sharpe Ratio =
Cov
.. &1
)b /)R
b
N /N
. P
= i / 2i
#
%
#
%
)'
7C/.
.
where,
FinQuiz
Formula Sheet
n P
i i
VPRI =
i =1
index Portfolio = PR I =
VPRI 1 VPRI 0
VPRI 0
$
$
$
$$
Pi1 Pi 0
Pi 0
($$
$
*
,
V/
/
$
*
,
V
/
$
*
,
V
&ff%
%
7C
P Pi 0
wi i1
i =1
Pi 0
5. % in value of Total return of Index
&
/
$$
2
9
Where Si = Security i
12. Weight of Si under Mkt Cap weighting =
V
$2$
/$
1
$2$
2
$
(V
$2$
/$
&1
$2$
/$
2
$
)
V
$p
$
`(V
$p
$
)
e
FinQuiz
Formula Sheet
(&'C )) $1)^&
2. ROE in yr t =
3. Value of a share of stock for n holding
period or investment horizon =
8*' ! ^+ 7C
OR
ROE =
L 79
*
G[& &'C
)
$1 w
/
(
.
22$)
22$_ C
,'
! n_ C
^+ C $2
79
$
&'C
)
$1
/ '$
/
$$
8*'
$$$
8*' C
2$ /$
&1 $2
/ ( . 22$)
V#V7
[& &'C
)
$1 w
f =
M[&
f 1 + 7
(1 + )G
L
(1 + )L
L'&
B
L'& = f (1 + 7 )L 1 + B
L =
f
7&
% /7%
/'
/'
V0 =
D0 (1 + g ) D0 (1 + 0) D0
=
=
rg
r 0
r
f =
G/&
+
G
(1 + )
1+
FinQuiz
Formula Sheet
(I + Qm) FV (I + QM ) FV
(I + QM ) FV
+ FV
m
m
m
+
+...
+
1
2
N
" I + DM %
" I + DM %
" I + DM %
$1+
'
$1+
'
$1+
'
#
#
#
m &
m &
m &
7. Accrued interest = AI
=
4. Inflation adjusted coupon payment for a
capital-indexed bond
= [Par value (1 + CPI)] coupon rate
/<
/.
.
PMT
PMT
PMT + FV
+
+... +
1
2
(1+ Z1 ) (1+ Z 2 )
(1+ Z N ) N
o/k
u/k
11.
# FV PV &
%
)
Days $ FV ('
3. Bond price =
PMT
PMT
PMT + FV
PV =
+
+... +
1
2
(1+ r) (1+ r)
(1+ r) N
PV (1+ r)t/T
# /&1 $ *
[&
&'&1
$
w
DR = Year
4. % Price change =
PMT
PMT
PMT + FV
+
+... +
1t/T
2t/T
(1+ r)
(1+ r)
(1+ r) Nt/T
# Days
&
PV = FV %1
DR (
$ Year
'
! APRm $ ! APRn $
#1+
& = #1+
&
"
m % "
n %
PV =
FV
" Days
%
AOR '
$1+
#
&
Yr
! Yr $ ! FV PV $
AOR = #
&
&#
" Days % " PV %
Relation b/w two spot rates and Implied
Forward Rate:
FinQuiz
Formula Sheet
2. Monthly CF for a MPS = Monthly CF of
underlying pool of mortgages - Servicing
fee - Other fees
3. Pass-through rate = Mortgage rate on the
underlying pool of mortgages Servicing
Fee - Other fees
4. SMM = Pre-pmt for month (Beg
mortgage balance for month Scheduled
principal re-pmt for month)
5. CPR = 1 (1 SMM)12
6. CF Construction (Monthly CF for MPS):
7. DSC ratio =
$ /.
)*$
#$'
m
)
&
^
, $*
%
" PMT
2t/T
'
$
' + ( 2 t / T )$ (1+ r )
'
$ PV Full
'
$
&
#
%
" PMT + FV %,
Nt/T '*
'
$
' +... + ( N t / T )$ (1+ r )
'*'
$ PV Full '*
'
$
'*
&
#
&.
OR
'
+
)1+ r 1+ r + #$ N ( c r )%& )
MacDur = (
, (t / T )
N
c #$(1+ r ) 1%& + r )
)* r
-
FinQuiz
8. Modified D =
Formula Sheet
&
18. Full price of Bond (in currency units) Money D in annual YTM
&'
9. Annualized Modified D =
&
19.
(PV ) (PV+ )
2 (Yield) (PV0 )
22. %PV
&
&
k
&+ ^ &
= (-AnnModDur Yield) +
()k
! &+
.'
)*
()k
(1+ r)2
[ N (t / T )] [ N +1 (t / T )]
!
&+
&+
^
/
1/G
Full
Or
%PV Full = (-AnnModDur Yield) +
(PV ) (PV+ )
13. Effective D =
2 (Curve) (PV0 )
+ Mod D of Bond N
(PV ) (PV+ )
2
+ Mod D of Bond 2
PVBP =
Mod D of Bond 1
FinQuiz
Formula Sheet
Convexity (Spread)2
!
$
,
7^!8
!
,
7^!8
!
,/#$2
7^!8
4. Margin Call:
Long position: Price that would
trigger a margin call = IM req MM
req
7
(!)
&''
2. Commodity = F 0, T = S0 e (r )T
where, = Convenience yield Cost of
carry
3. S0 =
7
(!)
&''
FinQuiz
RN =
1 - ZN
Z1 + Z 2 +.... + Z N
Formula Sheet
1
Zn =
1 + ( Ln days / 360)
Put-Call Parity
Value FC = c0 + X / (1+r) T
Payoff at expiration (when call out-ofthe-money) = X.
Payoff at expiration (call in-themoney) = X + (ST X) = ST.
C = p 0 +S 0
X
(1+ r)T
p 0 = c 0 S 0 +
X
(1+ r)T
S0 = c 0 +
X
p0
(1+ r)T
X
= p 0 +S0 c0
(1+ r)T
Ru = Rd e2
Value at time 0 = V0 = hS0 c0
Value at time 1 will either V1+ = hS1+ c1+ or V1- = hS1- - c1-
FinQuiz
Formula Sheet
cT = max (0, ST X)
When ST X cT = 0
When ST > X cT = ST X
Value at expiration = -cT
Profit = cT+ c0
Maximum profit = c0
Maximum loss = no upper limit
Breakeven = ST* = X +c0
FinQuiz
Formula Sheet
1Ug
QHRMGHwMHGMOL
NHGI
where