If you examine the most difficult professional tests in the world, the CFA exam almost always ranks near the top of the list. But you shouldn’t let that deter you from pursuing the CFA designation.
Given a suitably disciplined approach, you could pass this challenging exam the very first time you take it.
Exam Format and Details
The CFA exam is actually composed of three separate exams, each of which you must pass, and in the proper order. The curriculum builds on each preceding level, and the questions and concepts become increasingly complex as the candidate progresses through the various phases.
- Level I. You must meet the CFA program enrollment requirements in order to sit for this exam. It consists of multiple-choice questions and its pass rate of 43 percent is the lowest of the three.
- Level II. You must pass the Level I CFA exam in order to sit for the second exam, which consists of vignette-supported multiple-choice questions. The pass rate for this one is 45 percent.
- Level III. Once you pass the Level II CFA exam, you’re allowed to take the third and final exam. This one consists of vignette-supported constructed-response questions, as well as vignette-supported multiple-choice questions. The pass rate for Level III is 56 percent.
You’ll need to use the CFA exam calendar to check the exams and dates as you approach the sitting for the exam. Every exam window varies, based on the market and appointment availability. Keep this in mind as you enter the latter stages of preparation.
4 CFA Exam Study Tips
If you are preparing to take the CFA exam, here are four helpful tips that will guide you through the process.
- Give Yourself a Long Runway
The average CFA candidate reports having spent at least 300 hours studying before passing each level of the exam. Many candidates give up closer to 400 or 500 hours. It’s imperative that you give yourself a long enough runway to prepare.
You’ll likely need to begin the study and preparation process many months in advance. The more detailed you are, the better your results will be.
Don’t just plan to study on a certain day; mark it in your calendar and be specific. How many hours will you devote to it? When will you start/stop? What are your learning objectives?
Intentional planning is most likely to result in success.
- Choose the Right Course
A solid CFA exam prep course can go a long way toward helping you to pass each of the three levels of the exam. But there are many courses to choose from, so how do you narrow the options?
In addition to inquiring about pass rates for former students, you should look into each course’s level of hands-on involvement. Does it consist of little more than a series of videos and fill-in-the-blank worksheets? Or is there any sort of personal interaction?
For example, Wiley’s CFA Program Exam Review has 1:1 mentoring as part of their course. That’s a striking accompaniment to engaging video lectures and other features.
Not every course has options such as this, so watch for the ones that do.
- Consistency Over Cramming
You might have gotten away with cramming for exams in college, but you’re probably not going to pass the CFA exam with this approach. In fact, research shows that cramming can actually have adverse results.
Consistency is the smart approach to CFA exam preparation. You don’t need to learn everything at once (nor should you try).
It’s better to study for two hours every day over several weeks’ time than to cram for eight hours a day in the final week leading up to the exam. You need to give yourself time to let the content soak in and percolate.
- Take Practice Exams
The CFA exam has a specific design. Each section has particular types of questions and a format you must follow.
By taking practice exams in the weeks leading up to the actual test, you will become more comfortable with the process of and feel of the exam conditions.
Set Yourself Up for Success
There’s no getting around the fact that the CFA exam is challenging. But if you devise a suitable plan and dedicate a sufficient amount of time and energy to preparing for it, you’re fully capable of passing on your first attempt.
Use the pointers above as a springboard to get yourself moving in the right direction.