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Thanks for quick reply. Much appreciated.

There is hardly any overlap between FRM L2 and CFA L1. Hence, someone who got FRM L2 this time can as easily get CFA L1 studying 1-2 months as someone who didn't get FRM L2 this time. In other words: P(A|B)=P(A).

The only safe way is BT questions/summaries and official GARP readings. Good luck and fingers crossed.

Yes, it's possible, e.g. if the cutoff is at 44 out of 80. If the cutoff is at 46 out of 80 it will be difficult.

I think key here is whether to use conditional or unconditional PD for year 2. I'm not sure though which approach is more appropriate.

Makes a lot of sense to me.

As MVAR = VAR Portfolio/Total Assets Portfolio * Beta and VAR P/Total Assets is constant for all three portfolios, I think Beta equals MVAR, so expected return over Beta all day long in my humble view.

I agree 100% with that explanation and so does GARPs official reading (Market Risk, p244-245)

Generalized Pareto is used to model severity (GARP Readings, Operational Risk, p108).

Hi @David Harper CFA FRM, I'm just reading through the Standardized Measurement Approach SMA. I was wondering how exactly the "loss component" part will be calculated in practice. Let's assume we are in Bucket 3 and we have 10 Losses of EUR 150mm on average every year. The loss component is...

Hi @David Harper CFA FRM, thanks a lot for clarifying this. I get it know, key is how the H0 Hypothesis is stated and Type 1 Error is rejecting a good Null while Type 2 is mistakenly accept a bad Null. Thanks a lot!

Hi @David Harper CFA FRM, I was just reading through the "Validating Rating Models" Chapter and I'm left slightly confused with the definition De Laurentis uses for Type 1 and Type 2 errors with regard to the graph on p16 on the slides or p160 figure 10-5 in the original readings. What De...