About the CFA Level I

CFA Level I 2012: Some interesting facts

So, what exactly have you enrolled for? Here is a list of all the main facts I have found out so far.

What is the exam like? Paper based, 240 Multiple choice questions, taken in two 3 hour sessions (120 in each) separated by a two hour lunch break. Choose from A, B or C. Taken in your test centre of choice on Dec 1st 2012.

What's on it? There are ten topic areas, the weighting of each are given here:

http://www.cfainstitute.org/cfaprogram/courseofstudy/pages/topic_area_weights.aspx

A lot more will be said on these later on, but for now let's all just notice that the curriculum is very broad for this exam.

How hard is it? This is a popular question on the internet, to which no-one can give a definite answer. Why? two reasons.

1: Everyone finds different things difficult in different ways.

2: They don't publish the pass mark.

With only three options for each question your result with statistically approximate 33% even with no knowledge of any of the material.

Given there are so many questions this effect works reliably even at higher percentages. Say you are sure on 70% of the questions and have to guess the rest. You have still left 72 questions blank, 24 of which you would expect to get by guessing, moving your mark up to 80%.

So you should be aiming for a little more than you might for a written exam when looking for a benchmark!

The CFA state that a score of 70% is considered "Average or above average", also the pass mark for the IMC (Investment Management Certificate) is stated to be range from 65% to 75%. The IMC is considered by many to be the miniature version of the CFA.

How many people pass Unit I? In a typical year only around 40% of candidates pass.

There is a huge amount written out there on the CFA pass rate, why it is so low etc. The most likely cause in my opinion is that many people simply don't appreciate the vast breadth (not depth) of all ten areas of the syllabus here, and are left facing dozens of exam questions on the day they are totally unfamiliar with. Questions they could have got ... if they could just remember how p.117 of the Economics book defines Total Variable Cost.

However, I am not going to dwell on this here for one simple reason. Why does it matter to you?

Spending hours on google reading a list of hypotheses as to why so many people don't study, understand or show up for the CFA exam is not the mentality of a successful candidate. This Blog focuses on how to pass the CFA not how to fail it.