CIMA P3: Puts, calls and the dreaded 'Select all's'

Clare Finch: Partner at HTFT Partnership

During my recent CIMA  ‘Ask a tutor’ session, the most common question I faced was ‘How do you handle the Select ALL that apply questions’ and the biggest technical  worry was surrounding the use of puts and calls.

This article therefore is designed to bring the two problems together and hopefully help with both in the same article. They both do have the same root. To be proficient in a ‘Select ALL’ you need to be highly proficient in the subject matter being examined.

Gaining such proficiency  - Use long form questions

My advice for all sections of the P3 exam is that in order to get better at OT questions you need to practice with long form questions. The CIMA old syllabus questions offer an excellent source of material. Yes you need to work OT questions but missing the ‘long form stepping stone’ is causing students problems. Remember you need to be able to write long form answers in the SICS so this will help prepare for that too.

Print the notes and watch the four video's … I hope you enjoy

Puts, calls and select alls - notes

Videos:

Part 1 - Setting a cap on interest rates

Part 2- Using a collar to manage interest risk 

Part 3 - Fixing the interest rate using an FRA

Part 4 - Fixing the interest rate using a STIR Future

If you have any comments or questions please email [email protected]