On distributions

[Jo_]

Hi,

To anyone with experience on the FRM part 1 exam:

I am currently working through the Q.A section of FRM1 and had a practical question on distributions. I understand we are supposed to know the mean and stdev formulas (which are quite straightforward), but are we also supposed to know the PDF functions of all the distributions by heart (which i find a bit useless tbh)? Will this be questioned? If so, is there not a function on the TI BA2plus to extract these by inputting the distribution parameters? (im used to a TI-84, on which this is possible to do, i have ordered but still waiting to receive my TIBA2plus).

Thanks for the clarifications!

Jo

 

[David Harper CFA FRM]

Hi @JoeriG Not even, to memorize all pdf functions is much too tedious and absolutely will not be expected on FRM. You only really want to memorize binomial and Poisson pdfs (uniform and Bernoulli do not require memorizing-yes?). TI BA II+ will not perform distributional pdf/CDF, fwiw. Thanks,

 

[Jo_]

Thanks David, very clear.

Just noticed today that i had already learned the ones you mentioned by heart "by accident" by working through your exercise sets!

 

[Jo_]

@David Harper CFA FRM CIPM : for reference, this was exactly correct advice! Despite GARP stating that they don't expect you to know the distrubution formulas in their mail before the exam, there was one question on binomial PDF and one on poisson.

 

[David Harper CFA FRM]

Hi @Jo_ Thank you for that valuable feedback (+1 star), it is very good to know that we should be encouraging memorization of binomial and Poisson, thank you!

 

[tosuhn]

Hi @David & @Nicole, I am on reading 10 now and I am having problems calculating the distribution variance on page 23 (question5).
Isn't the variance just (sum of x^2*p(x))- mean^2? please help

 

[David Harper CFA FRM]

Hi @tosuhn (cc @Nicole Manley ) I cannot tell, sorry, if you are referring to p.23 of the study notes and you mean question 3 (my guess); or possibly p.23 of the practice question set. Here are the respective sources:

• https://forum.bionicturtle.com/threads/p1-t2-301-millers-probability-matrix.6757/
• https://forum.bionicturtle.com/threads/p1-t2-202-variance-of-sum-of-random-variables.4967