CFA Level 2 Glossary
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The CFA Level II exam consists of 22 item sets comprised of vignettes with 88 accompanying multiple-choice questions.
Duration: The CFA Level II exam will be 4 hours and 24 minutes, split into two equal sessions of 2 hours and 12 minutes, with an optional break in-between.

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CFA Level 2 Topics & Weightage in 2022:
Ethics 10-15%​
Quantitative Methods 5-10%
Economics 5-10%
Financial Reporting & Analysis 10-15%
Corporate Finance 5-10%
Equity 10-15%
Fixed Income 10-15%
Derivatives 5-10%
Alternative Investments 5-10%
Portfolio Management 10-15%

CFA Level 2 Glossary
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25 Questions

1. The sum of the sample observations - divided by the sampfe size.

2. Forecasted dividends per share over the next year divided by current stock price.

3. Heteroskedasticity in the error variance that is correlated with the values of the independent variable(s) in the regression.

4. A model for pricing options in which the underlying price can move to only one of two possible new prices.

5. Sales minus the cost of sales ~.e . - the cost of goods sold for a manufactur-ing cOlp pany) .

6. The risk that a financial instrument cannot be purchased or sold without a significant concession in price due to the size of the market.

7. The stage of growth between the growth phase and the mature phase of a company in which earnings growth typically slows.

8. Individuals or companies b hat execute fu tures transactions for other parties off the exchange.

9. The difference between the observed value of a statistic and the quantity it is intended to estimate.

10. A balance sheet that does not show subtotals for current assets and current liabilities.

11. Any outcome or specified set of outcomes of a random variable.

12. A procedure for determining the interest on a bond or loan in which the interest is added onto the face value of a contract.

13. The initial issuance ofcommon stock registered for public trading by a formerly private corporation.

14. The statistical measure that indicates the peakedness of a distribution.

15. The number of observations in a given interval (for grouped data) .

16. The granting of stock options to employees as a form of compensation.

17. Ratios that measure the quantity of an asset or flow (e.g. - earnings) in relation to the price associated with a specified claim (e.g. - a share or ownership of the enterprise).

18. With reference to equity investors - investors who are focused on paying a relatively low share price in relation to earnings or assets per share.

19. The relationship amongputs - calls - and forward contracts.

20. With respect to the application of the LIFO inventory method - the liquidation of old - relatively low-priced inventory; happens when the volume of sales rises above the volume of recent purchases so that some sales are made from relatively old - low

21. The change in the bond price for a 1 basis point change in yield. Also called basis point value (BPV).

22. A feature of futures markets in which futures prices provide valuable information about the price of the underlying asset.

23. Net operating income less debt service and less taxes payable on income from operations.

24. An option that gives the holder the right to sellan underlying asset to another party at a fixedprice over a specific period of time.

25. A portfolio offering the highest expected return for a given level of risk as mea-sured by variance or standard deviation of return.

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