formula-sheet
CFA Level I Ethics and GIPS Formula Sheet
Public formula sheet for performance presentation calculations linked to Ethics and GIPS.
TL;DR
Ethics is primarily rules-based, but performance presentation questions can require linked returns, composite weighting, and dispersion calculations.
Formula Reference
Geometrically linked return
Linked return = product(1 + r_t) - 1Use for multi-period returns.
Composite return
Composite return = sum[w_i x r_i]Use account weights as specified.
Range dispersion
Range = highest account return - lowest account returnOne possible dispersion measure.
Standard deviation dispersion
s = sqrt[sum(r_i - mean)^2 / (n - 1)]Use when the question asks for standard deviation of account returns.
BA II Plus Keystrokes
- Use geometric linking for multi-period return.
- Use weighted-average arithmetic for composite return.
- Use DATA/STAT for standard deviation dispersion.
Worked Example
- Returns are 5 percent and 6 percent over two periods.
- Linked return = 1.05 x 1.06 - 1 = 11.3 percent.
- Do not average the two returns.
Common Mistakes
- Using arithmetic averages for linked performance.
- Ignoring fee treatment.
- Using equal weights when asset weights are required.
Related Guides
- CFA Level I Ethics and GIPS Performance Calculations - Public reference for GIPS-linked return, composite, dispersion, and performance presentation calculations.
- Time-Weighted vs Money-Weighted Return - Compare TWR and MWR with formulas, examples, and CFA Level I interpretation rules.
- BA II Plus: Standard Deviation Step by Step - Use the BA II Plus DATA and STAT worksheets to compute sample standard deviation.