Contents Learning Outcome Statements (LOS) Welcome to the 2019 Level II SchweserNotes™ Study Session 1—Ethical And Professional Standards (1) Readings and 2: CFA Institute Code of Ethics and Standards of Professional Conduct Guidance for Standards I–VII Exam Focus Module 1.1: Introduction to the Code and Standards Module 2.1: Standards I(A) and I(B) Module 2.2: Standards I(C) and I(D) Module 2.3: Standards II(A) and II(B) Module 2.4: Standard III(A) Module 2.5: Standards III(B) and III(C) Module 2.6: Standards III(D) and III(E) Module 2.7: Standards IV(A), IV(B), and IV(C) 10 Module 2.8: Standard V 11 Module 2.9: Standard VI 12 Module 2.10: Standard VII 13 Key Concepts 14 Answer Key for Module Quizzes Study Session 2— Ethical And Professional Standards (2) Reading 3: Application of The Code and Standards Exam Focus Module 3.1: Ethics Case Studies Reading 4: Trade Allocation: Fair Dealing and Disclosure Exam Focus Module 4.1: Trade Allocation Reading 5: Changing Investment Objectives Exam Focus Module 5.1: Changing Investment Objectives Study Session 3—Quantitative Methods Reading 6: Fintech in Investment Management Exam Focus Module 6.1: Fintech in Investment Management Key Concepts Answer Key for Module Quiz Reading 7: Correlation and Regression Exam Focus Module 7.1: Covariance and Correlation Module 7.2: Linear Regression: Introduction Module 7.3: Hypothesis Tests and Confidence Intervals Module 7.4: Predicting Dependent Variables and Confidence Intervals Module 7.5: ANOVA Tables, R2, and SEE Key Concepts Answer Key for Module Quizzes Reading 8: Multiple Regression and Issues in Regression Analysis Exam Focus Module 8.1: Multiple Regression: Introduction Module 8.2: Hypothesis Tests and Confidence Intervals Module 8.3: ANOVA and the F-test Module 8.4: Coefficient of Determination and Adjusted R-Squared Module 8.5: Dummy Variables Module 8.6: Assumptions: Heteroskedasticity Module 8.7: Serial Correlation Module 8.8: Multicollinearity 10 Module 8.9: Model Misspecification, and Qualitative Dependent Variables 11 Module 8.10: Supervised and Unsupervised Machine Learning 12 Module 8.11: Machine Learning Algorithms 13 Key Concepts 14 Answer Key for Module Quizzes Reading 9: Time-Series Analysis Exam Focus Module 9.1: Linear and Log-Linear Trend Models Module 9.2: Autoregressive (AR) Models Module 9.3: Random Walks and Unit Roots Module 9.4: Seasonality Module 9.5: ARCH and Multiple Time Series Key Concepts Answer Key for Module Quizzes Reading 10: Probabilistic Approaches: Scenario Analysis, Decision Trees, and Simulations Exam Focus Module 10.1: Probabilistic Approaches Key Concepts Answer Key for Module Quiz Topic Assessment: Quantitative Methods Topic Assessment Answers: Quantitative Methods Study Session 4—Economics Reading 11: Currency Exchange Rates: Understanding Equilibrium Value Exam Focus Module 11.1: Forex Quotes, Spreads, and Triangular Arbitrage Module 11.2: Mark-to-Market Value, and Parity Conditions Module 11.3: Exchange Rate Determinants, Carry Trade, and Central Bank Influence Key Concepts Answer Key For Module Quizzes Reading 12: Economic Growth and the Investment Decision Exam Focus 10 11 12 Module 12.1: Growth Factors and Production Function Module 12.2: Growth Accounting and Influencing Factors Module 12.3: Growth and Convergence Theories Key Concepts Answer Key for Module Quizzes Reading 13: Economics of Regulation Exam Focus Module 13.1: Economics of Regulation Key Concepts Answer Key for Module quiz Topic Assessment: Economics Topic Assessment Answers: Economics Formulas Appendix A: Student’s T-Distribution Appendix B: F-table at Percent (Upper Tail) Appendix C: F-Table At 2.5 Percent (Upper Tail) Appendix D: Chi-Squared Table Appendix E: Critical Values for the Durbin-Watson Statistic List of pages 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 viii xi xi xii xiii xv xvi 10 11 12 13 14 15 16 17 18 19 20 21 23 24 25 26 27 28 29 30 31 32 33 34 35 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