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Margin of safety, retake CFA

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CFA test did not turn out the result I liked to see. I thought about the reasons, besides the unlucky factor (my score right around the pass/fail line), I attribute the main reason to myself: I did not work hard enough, and my financial knowledge is not good enough. Imagine if I could make more than 70% in all the sections, I would not rely on someone’s mercy on passing the test. Thinking along those lines, I decided to not to challenge the result (in CFA exam rule, one can pay $100 to get it re-scored). I will pay $480 to re-take the CFA level I this Dec.

Of course, the key for me is make sure this time I work hard, make sure I reallly understand all the materials, so that I would have sufficient margin of safety (not the razor thin margin of safety, or pure luck like the June test).

Buying stock with Margin of Safety in Mind
This reminds me Chapter 20 of Ben Graham “Intelligent Investor”, as Warren Buffett emphasized at this year annual shareholder meeting. By that, Ben/Warren meant buy a good stock at bargain price, so that in case something terrible go wrong, we can still sell the stock without a big loss.

Just for fun: my unlucky test experience in the US
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Interesting news: Buffett is put up a one miilion dollar bet for any hedge fund beat S&P in next 10 years. The proceeds (if Warren wins) will go to his charity.

I am going to take a week of vacation from tomorrow, and I may not update this blog during this period.

Meanwhile, I am going to read the chapter 20 of Intelligent Investor (Ben Graham). I already read chapter 6 as suggested by Warren in this year annual shareholder meeting (Q&A): it’s about knowing the risk of investments. Chapter 20 is about margin of safety.