Why the BA II Plus is Crucial for the CFA®
The Texas Instruments BA II Plus is one of the two calculators officially authorized for the CFA® exam (along with the HP 12C). Mastering this tool can save you precious minutes during the exam and significantly improve your score.
With only 90 seconds per question on average, every second counts. This guide will reveal advanced techniques to fully exploit your calculator's capabilities.
Candidates who master their calculator save an average of 15-20 seconds per complex calculation!
Advantages of the BA II Plus
- Intuitive and logical interface
- Built-in advanced financial functions
- Statistical and probability calculations
- Efficient cash flow management
- Rate and currency conversions
- Memory to store constants
Optimal Configuration for the Exam
Essential Settings
1. Number Format
Sequence: 2nd FORMAT
Recommended: 4 decimals for optimal precision
2. Periods per Year
Sequence: 2nd P/Y 1 ENTER
Default: P/Y = 1, C/Y = 1 (annual compounding)
3. Calculation Mode
Sequence: 2nd BGN
Default: END (payments at end of period)
Main Interface
Keys highlighted in red are the most used for CFA® calculations
Essential Shortcuts to Save Time
Navigation Shortcuts
Quick Clear
CE/C : Clear last entry
2nd CE/C : Complete reset (CLR TVM)
Quick Memory
STO 0-9 : Save
RCL 0-9 : Recall
Repeat Calculations
2nd ENTER : Repeat last calculation
Express Calculations
Quick Percentages
For +15%: × 1.15 =
For -15%: × 0.85 =
Common Powers
y^x : General power
2nd y^x : x-th root
Quick Inversion
1/x : Direct inverse
+/- : Sign change
Ultra-Fast Sequences
Effective ↔ Nominal Rate
To Effective:
2nd ICONV
NOM = nominal rate
C/Y = periods
CPT EFF
Quick Amortization
Amortization table:
2nd AMORT
P1 = start period
P2 = end period
↓ to navigate
Express Statistics
Averages:
Data + 2nd DATA
2nd STAT
↓ for results
Essential Calculations for the CFA®
Time Value of Money (TVM)
Example: Present Value of an Annuity
Problem:
Calculate the PV of 10 annual payments of €1000 at 8% interest
Sequence:
10 N
8 I/Y
1000 PMT
0 FV
CPT PV
Result: -€6,710.08
Rate of Return Calculation
Problem:
Investment of €10,000, return of €15,000 in 5 years. What yield?
Sequence:
5 N
10000 +/- PV
15000 FV
0 PMT
CPT I/Y
Result: 8.45%
Cash Flow Analysis (CF)
NPV and IRR - Quick Method
Irregular flows:
Initial investment: -€100,000
Year 1: +€30,000
Year 2: +€40,000
Year 3: +€50,000
Discount rate: 10%
Sequence:
CF → CF₀ = -100000 ENTER ↓
C01 = 30000 ENTER ↓ ↓
C02 = 40000 ENTER ↓ ↓
C03 = 50000 ENTER
NPV → I = 10 ENTER ↓
CPT → NPV = €4,815
IRR of the Same Project
After entering CFs:
IRR CPT
Result: IRR = 12.05%
Important Tip
Once flows are entered, you can calculate NPV at different rates without re-entering everything. Just change the I value in the NPV menu!
Statistics and Probabilities
Averages and Standard Deviations
Data entry:
2nd DATA
Value ENTER ↓
Frequency ENTER ↓
Calculations:
2nd STAT
↓ to navigate
Permutations/Combinations
nPr: n 2nd nPr r
nCr: n 2nd nCr r
Example:
10 objects, choose 3
10 2nd nCr 3 = 120
Distributions
Normal: available via advanced statistics menus
Tip: For CFA®, often faster to use provided tables than calculator functions
Critical Mistakes to Avoid
Top 10 Fatal Errors
1. Forgetting to Reset TVM
Problem: Previous calculations influence new results
Solution: 2nd CE/C before each new TVM problem
2. P/Y ≠ 1
Problem: Calculator configured for monthly/quarterly compounding
Solution: Check 2nd P/Y = 1 systematically
3. Cash Flow Signs
Problem: Not respecting input/output convention
Solution: Negative investment, positive returns (or consistent opposite)
4. Inconsistent Time Units
Problem: Mixing annual rates with monthly periods
Solution: Always harmonize: annual rate ↔ N in years
5. Wrong BEGIN/END Mode
Problem: Payments at beginning vs end of period
Solution: Check 2nd BGN according to problem statement
6. Multiple IRR Confusion
Problem: Complex flows can give multiple IRRs
Solution: Analyze economic consistency of result
7. Decimal Precision
Problem: Rounding too early in intermediate calculations
Solution: 4+ decimals during calculation, round at end
8. Forgetting +/- for Inversion
Problem: Incorrect sign in TVM results
Solution: Use +/- if necessary
9. Partial Clear
Problem: Using CE/C instead of complete clear
Solution: 2nd CE/C for total reset
10. Panic and Rush
Problem: Stress → input errors
Solution: Breathe, check each step methodically
Quick Verification Checklist
Before TVM Calculation
- ☑️ 2nd CE/C
- ☑️ P/Y = 1
- ☑️ END mode
- ☑️ 4 decimals
During Entry
- ☑️ Unit consistency
- ☑️ Correct CF signs
- ☑️ Realistic values
- ☑️ No rushing
After Calculation
- ☑️ Order of magnitude
- ☑️ Logical sign
- ☑️ Coherence test
- ☑️ Backup result
Problem Detected
- ☑️ Complete reset
- ☑️ Re-enter calmly
- ☑️ Check settings
- ☑️ Test another method
Exam Strategies with the BA II Plus
Optimal Time Management
Quick Calculations (< 30s)
- • Simple percentages
- • Rule of 3
- • Basic conversions
- • Arithmetic averages
- • Basic financial ratios
Medium Calculations (30-60s)
- • Standard TVM
- • Basic statistics
- • Simple NPV
- • Probabilities
- • Correlations
Complex Calculations (60-90s)
- • Irregular CFs
- • Complex bonds
- • Multiple regressions
- • Portfolio optimization
- • Advanced derivatives
Solution Strategies by Domain
📊 Quantitative Methods
BA II Plus priorities:
- • Automated descriptive statistics
- • Built-in regressions
- • Probability functions
- • Hypothesis testing (complementary calculations)
💼 Corporate Finance
TVM intensive:
- • Project NPV/IRR
- • Cost of capital (WACC)
- • DCF valuations
- • Sensitivity analyses
📈 Equity Investments
Valuation models:
- • DDM (Dividend Discount Model)
- • P/E ratios and multiples
- • Dividend growth
- • Risk-adjusted returns
🏦 Fixed Income
BOND function crucial:
- • Bond price/yield
- • Duration and convexity
- • Yield curves
- • Portfolio immunization
Action Plan for Exam Day
🏁 Before the Exam
- ✓ Test calculator
- ✓ New batteries
- ✓ Complete reset
- ✓ Standard configuration
- ✓ Memorize constants
⚡ First Session
- ✓ Start with simple calculations
- ✓ Check configuration
- ✓ Establish rhythm
- ✓ Mark long questions
- ✓ Keep time for review
🔄 Break Between Sessions
- ✓ Don't discuss answers
- ✓ Mental recharge
- ✓ Check calculator
- ✓ Reset if necessary
- ✓ Confidence in preparation
🎯 Second Session
- ✓ Maintain concentration
- ✓ Apply same strategy
- ✓ No panic if difficult
- ✓ Use elimination
- ✓ Finalize all answers
Master Your BA II Plus, Maximize Your CFA® Score
The BA II Plus calculator is not just a calculation tool for the CFA® exam, it's a performance multiplier. By mastering its advanced functions and avoiding common errors, you gain a decisive competitive advantage.
With the techniques in this guide, you'll save 15-30 seconds per calculation question, which is 45-90 minutes over the entire exam - precious time to review and optimize your answers.
The difference between success and failure on the CFA® often comes down to technical details and time management. Your calculator can be your best ally.
Summary of Key Points
- ✓ Configuration: P/Y=1, 4 decimals, END mode
- ✓ Reset: 2nd + CE/C before each new calculation
- ✓ Hidden functions: BOND, ICONV, regressions
- ✓ Memory: Store frequent constants (STO 0-9)
- ✓ Verification: Order of magnitude and consistency
- ✓ Timing: 30s/simple, 60s/medium, 90s/complex max
- ✓ Strategy: Mark and return to difficult ones
- ✓ Preparation: Intensive practice pre-exam
Goal: Transform your BA II Plus into a secret weapon for the CFA®
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Good luck mastering your BA II Plus!
December 2024