CAIA resources

Alternative investments and portfolio applications

• Building a financial analyst work sample

  Create an original research note that shows inputs, assumptions and reasoning.

  Careers

• Showing evidence and assumptions in a finance work sample

  Separate observed facts, model assumptions and conclusions in a project note.

  Careers

• Simple and effective annualized trade-credit costs

  Compare distinct rate conventions before comparing financing alternatives.

  Comparisons

• Discrete and continuous compounding conventions

  Compare mathematical growth factors without treating a benchmark as an investment product.

  Comparisons

• Interest coverage and cash payment capacity

  Distinguish an earnings-based quotient from the timing of cash available for a payment.

  Comparisons

• Current, quick and cash ratios: comparing the numerators

  Identify which current assets enter each stated measure.

  Comparisons

• Operating cycle and cash conversion cycle

  Distinguish the operating clocks from the net clock after supplier-payment timing.

  Comparisons

• Net working capital and current ratio

  Separate an amount difference from a relative balance-sheet measure.

  Comparisons

• A level perpetuity and its convergence condition

  Use the infinite-stream formula only with the required timing and positive discount rate.

  Concepts

• MOIC: investment value relative to contributed capital

  Understand a value multiple and why it does not describe timing.

  Concepts

• Discounting with a negative periodic rate

  Explain why a future fixed payment can have a present value above its amount.

  Concepts

• Retained earnings and cash are different balances

  Distinguish an accumulated equity component from a liquid asset.

  Concepts

• Accounting equation: assets, liabilities and equity

  Read the accounting equation: assets, liabilities and equity formula, variables and scope.

  Formulas

• Annuity-due values at a common date

  Use the annuity-due values at a common date relationship with its timing and rate conditions.

  Formulas

• Cash conversion cycle from its three components

  Use the cash conversion cycle from its three components relationship with explicit definitions.

  Formulas

• Cash ratio including short-term marketable securities

  Read the cash ratio including short-term marketable securities formula, variables and scope.

  Formulas

• Common-size balance-sheet percentage

  Read the common-size balance-sheet percentage formula, variables and scope.

  Formulas

• Continuous-compounding value of a single amount

  Use the continuous-compounding value of a single amount relationship with its timing and rate conditions.

  Formulas

• Current ratio: current assets divided by current liabilities

  Read the current ratio: current assets divided by current liabilities formula, variables and scope.

  Formulas

• Days of inventory on hand

  Use the days of inventory on hand relationship with explicit definitions.

  Formulas

• Days payable outstanding with an explicit purchases flow

  Use the days payable outstanding with an explicit purchases flow relationship with explicit definitions.

  Formulas

• Days sales outstanding and the sales denominator

  Use the days sales outstanding and the sales denominator relationship with explicit definitions.

  Formulas

• Debt-to-assets ratio with a matching denominator

  Read the debt-to-assets ratio with a matching denominator formula, variables and scope.

  Formulas

• Debt-to-equity ratio and its debt definition

  Read the debt-to-equity ratio and its debt definition formula, variables and scope.

  Formulas

• Basic economic order quantity

  Use the basic economic order quantity relationship with explicit definitions.

  Formulas

• Effective annual rate from a nominal quotation

  Use the effective annual rate from a nominal quotation relationship with its timing and rate conditions.

  Formulas

• Effective rate for a shorter or longer interval

  Use the effective rate for a shorter or longer interval relationship with its timing and rate conditions.

  Formulas

• Equity multiplier in a consistent DuPont chain

  Use the equity multiplier in a consistent dupont chain relationship with explicit definitions.

  Formulas

• Five-factor DuPont identity and denominator conditions

  Use the five-factor dupont identity and denominator conditions relationship with explicit definitions.

  Formulas

• Payment for a fully amortizing level-payment model

  Use the payment for a fully amortizing level-payment model relationship with its timing and rate conditions.

  Formulas

• Future value of dated cash flows at a common time

  Use the future value of dated cash flows at a common time relationship with its timing and rate conditions.

  Formulas

• Interest coverage using EBIT

  Read the interest coverage using ebit formula, variables and scope.

  Formulas

• Inventory turnover and its cost-flow basis

  Use the inventory turnover and its cost-flow basis relationship with explicit definitions.

  Formulas

• Present value of a level perpetuity

  Use the present value of a level perpetuity relationship with its timing and rate conditions.

  Formulas

• Net profit margin

  Use the net profit margin relationship with explicit definitions.

  Formulas

• Net working capital: current assets less current liabilities

  Read the net working capital: current assets less current liabilities formula, variables and scope.

  Formulas

• Net present value formula and time-zero cash flow

  Read the NPV sum and understand its signs and timing.

  Formulas

• Operating cycle from inventory and receivable days

  Use the operating cycle from inventory and receivable days relationship with explicit definitions.

  Formulas

• Future value of an ordinary annuity

  Use the future value of an ordinary annuity relationship with its timing and rate conditions.

  Formulas

• Present value of an ordinary annuity

  Use the present value of an ordinary annuity relationship with its timing and rate conditions.

  Formulas