A.M. – P.M. Cramming BSOPM for FRM

Hey guys,

This is just a quick post to update you on my progress (or lack thereof) with exam preparation. Things haven’t gone exactly as I had hoped in terms of my schedule. However, at this point, I can’t sweat the small stuff. The good news is that, according to the past papers for this exam, I can choose 3 out of 4 questions to answer, and that gives me a bit of flexibility. Unfortunately, in looking at the past papers, I have noticed that each of the four questions is subdivided into 3 or four questions, and the sub questions are mixed such that there will inevitably be calculations and theory involved in each section.


I stayed up until 5am this morning cramming the Black-Scholes Option Pricing Model into my head, and although I’m pretty exhausted, I can solved a typical BSOPM question in 5 minutes or less. I think I will spend today continuing to practice BSOPM and add binomial option pricing, along with forward and futures pricing. Then (and I recognize that this is probably not very smart of me) I will spend Thursday and Friday studying until 5am, cramming theory and abstract concepts into my head so that I’m in somewhat better shape for the exam. Actually, I’ll essentially take a butterfly spread approach to managing the risk on this exam. There are certain theories (mainly assumptions about options pricing and trading strategies) that seem to recur on each exam, so I will attempt to learn just enough about each of them that I can answer successfully on the exam.

Delusions of grandeur are now over. While I was still euphoric about getting an ‘A’ on my last paper, the reality is that there isn’t nearly enough time for me to master these concepts well enough to get an ‘A’ on this exam. At this point, I simply want to pass and move on to the dissertation. That is, after I submit my FM paper due the week after the FRM exam….if the stress doesn’t make me a complete looney tune by then.

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About Ismail

Hi, I'm Ismail. I'm an American living abroad while trying to figure out what I want to be when (if) I grow up. I love sports, particularly American football and martial arts, and when I'm not working at one of my four jobs, you will likely find me in the gym lifting really heavy stuff. I'm a distance learning MSc Finance student, and I'll be happy to share my journey with you while trying to maintain some semblance of sanity.

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