When it comes to Series 79 gaps in knowledge for most people, analytical sections are the usual suspect. Whether evaluations, income statements, or balance sheets are your Achilles heel, there are other areas to make sure you have locked down. In today’s post, we discuss the more qualitative sections to make sure you know.
Series 79 Gaps: Math Can be Your Friend
At Professional Exam Tutoring, we get most of our requests from students that need work on the quantitative. Calculating ratios, understanding valuations, and deciphering the dynamics of a discounted cash flow are all areas we hear about constantly. Most formulas are cut and dry, so if you know the math, you’ll know the answer.
Based on feedback, you want to make sure simple ratios, such as the dividend payout ratio, current ratio, and quick ratios are all rock solid. Beyond these, however, understanding LIFO versus FIFO, and what causes the WACC to increase or decrease is also important.
Once you have these areas down, though, go back to the qualitative sections and also understand some of the nuances.
In the Weeds
For example, understanding the definition of a tender offer is great. That said, for even more points you’ll also want to understand some of the more detailed rules around tender offers. How many days can a tender offer be open? (20 days) How many days have to be added to the tender offer if there is a material update to the tender offer. (10 days)
Furthermore, some things you wouldn’t think might matter to bankers actually do matter for the investment banking exam. For example, equity research rules are an area you’ll want to understand.
You should be able to describe when an interaction between an investment banker and an equity research analyst is ok. You should also have a good understanding of when an equity research analyst is allowed to send their report to a subject company (or for that matter, to the investment banker).
Hint: It’s usually only when including facts, and no opinions.
Overall, we tend to see people increase their Series 79 exam score from the 50s and 60s to the mid 70s fairly easily. It’s getting to that low 80s and mid 80s region which requires a little more in depth knowledge. We definitely recommend trying to get your score into that range to ensure a pass. It’s not going to be easy but some systematic studying can. If you need any help, feel free to reach out! Good luck!