MindMap Gallery CFA Level 2 Review-Alternative
CFA Level 2 review notes for 2105. Mainly the big framework and the formulas that need to be memorized. They are all compiled based on personal understanding of the teaching materials. You can add or delete them according to your own review situation. I hope it can help you clarify your knowledge and improve your learning efficiency. I wish you all good luck in the exam~ For your reference, I hope you can get on board as soon as possible!
Edited at 2021-05-31 15:50:33This is a mind map about bacteria, and its main contents include: overview, morphology, types, structure, reproduction, distribution, application, and expansion. The summary is comprehensive and meticulous, suitable as review materials.
This is a mind map about plant asexual reproduction, and its main contents include: concept, spore reproduction, vegetative reproduction, tissue culture, and buds. The summary is comprehensive and meticulous, suitable as review materials.
This is a mind map about the reproductive development of animals, and its main contents include: insects, frogs, birds, sexual reproduction, and asexual reproduction. The summary is comprehensive and meticulous, suitable as review materials.
This is a mind map about bacteria, and its main contents include: overview, morphology, types, structure, reproduction, distribution, application, and expansion. The summary is comprehensive and meticulous, suitable as review materials.
This is a mind map about plant asexual reproduction, and its main contents include: concept, spore reproduction, vegetative reproduction, tissue culture, and buds. The summary is comprehensive and meticulous, suitable as review materials.
This is a mind map about the reproductive development of animals, and its main contents include: insects, frogs, birds, sexual reproduction, and asexual reproduction. The summary is comprehensive and meticulous, suitable as review materials.
alternative
real estate
real estate investment forms
Dimension one
private real estate Physical real estate investment
Sole proprietorship
joint investment
Limited Partnership
Hybrid Fund
public real estate indirect real estate investment
REIT (Real Estate Investment Trust)
REOC (real estate developer’s stock)
MBS/RMBS/CMBS
Dimension two
Equity
Entity Investment, REOC, REIT
debt
Loans, MBS
Real estate features
heterogeneity
high unit value
intensive management
high transaction cost
lack of liquidity
Difficulty in valuation
private real estate investment
Entity investment classification
Dimension one
residential properties
single family house(housing)
multi family properties(apartments)
non-residential properties
farmland / timberland
Dimension two
commercial real estate
multi-family properties apartment
office office building
industrial/warehouseIndustrial real estate
retail mall
hospitalily reception service agency
non-commercial real estate
single-family house
unique categories
farmland / timberland
investment risk
business conditions
Affected by the macroeconomic and business environment
new property lead time
There is a time lag from planning to final completion and rental
cost and availability of capital
Capital cost and availability
unexpected inflation
unexpected inflation
demographic factors
Demographic factors
lack of liquidity
Poor liquidity
environmental issues
Changes in surrounding environment
availability of information
Information is not transparent
management expertise
Property management is highly professional
leverage
Financial risks caused by leverage
investment income
current income
stable rent
capital appreciation
Capital appreciation
inflation hedge
Anti-inflation
deversification
risk diversification
tax benefits
Tax incentives
return risk characteristics
bond-like periodic receipt of rent
equity-like uncertainty about future earnings
Valuation
income approach
direct capitalization method
One-stage model, assuming that investors remember to invest sustainably
V0 = NOI/cap rate
NOI = no vacancy period rent other income - loss of vacancy - management expenses
No need to subtract depreciation
There is no need to subtract interest, only operating expenses
There is no need to subtract taxes, NOI is pre-tax income
cap rate = r-g = NOI/sale price of comparable
DCF method
Two-stage model, focusing on cash flows in multiple periods in the future
cost approach
1. When calculating replacement cost, the developer’s reasonable profit must be considered
2. Adjust depreciation
Because of the depreciation caused by the age of the house, use effective age rather than actual age.
Adjust functional/locational /economic obsolescence
3. Add land value
sales competition approach
1. Calculate recent transaction prices of similar properties per unit area
2. Compare the characteristics of the target property with comparable properties and make adjustments
3. Obtain the adjusted prices of comparable properties
4. The weighted average exceeds that of comparable properties.
4. Weighted average unit price multiplied by the area of the target real estate
indices
appraisal based indices
There is hysteresis
Data is smoothed and fluctuations are underestimated
Index correlations with other assets are undervalued
transaction-based indices
repeat-sales index
hedonic index
Direct Debt Real Estate Investment Appraisal
Solvency Index
DSCR=NOI/debt
Whether real estate income can pay off debts, the bigger the better
LTV=loan amount/appraisal value
The borrowing amount as a percentage of the valuation, the smaller the better
Income indicators
IRR
unleveraged IRR from the perspective of the entire house
leverage IRR from the perspective of own funds
equity dividend rate = CF1/equity
Dividend ratio, the bigger the better
public real estate securities
Advantages of indirect real estate investing
High liquidity
Low investment amount
Limited risk
Opportunity to indirectly own high-end real estate
Active management by professional fund managers
Strict supervision and transparent information
equity reits
Classification
retail
retail sales growth
office
job creation
hotel
job creation
industrial
retail sales growth
healthcare
population growth
storage
population growth
advantage
duty free
Predictable returns, high returns
risk diversification
shortcoming
Tax exemption conditional (dividend rate)
Investors have no control over the property
Secondary market costs, handling fees, etc.
Secondary market transactions, prices are affected by price fluctuations in the secondary market
lack of flexibility
Valuation
NAVPS
=(MV assets - MV liabilitis)/#share
1. Estimate real estate value 2. (+)Add the value of other tangible assets 3. (-) minus the value of liabilities 4. (÷)Excluding circulation share
relative value approach
P/FFO
P/AFFO
reoc
private equity valuation
control mechanisms
economic terms
Investment costs and risks
Categories and features
PE exit strategy
Valuation
commodities and derivatives
Commodity classification
Features
commodity index
backwardation & contango
commodity swap