How to Pass the CFA Exam - Part 1
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The Certified Financial Analyst (CFA) exam is one of the most popular and at the same time a very difficult exam in the finance industry. To earn the CFA designation, you need to pass three exams (Level 1 , 2, and 3 3) in a series. For each exam, you study using the assigned curriculum.
You can take any number of years to complete the CFA program. Also you can take the exams any number of times without any restriction. The curriculum is very dynamic and changes every year.
On a average only 20% of people who start on the CFA path complete all the 3 levels. About 50% people pass the level 1 exam to move to the next level.
The first step in preparing for the CFA exam is to get the required documents and prepare a study plan.
What you need?
1. Study Session Outlines and Learning Outcome Statements: Each CFA candidate is provided with the complete curriculum that includes the study session outlines, learning outcome statements, and source readings references for that exam level. This will be your best guide to prepare for the exam.
2. Sample Questions: The CFA Institute also provides a set of sample questions for each level with also include the past exam question. Though not enough, this is a good resource to check where you currently stand.
3. Candidate Body of Knowledge (CBOK) Topical Outline: This outline comes in handy to keep a track of your progress.
4. CFA Exam Topic Area Weights: These weights are important as they provide an insight into the importance and depth of each area.
All the above documents can be downloaded from the CFA Institute website.
Start Your Preparation
Start the exam preparation with a positive mindset and conviction. Before you start studying through the study material, take up the sample question paper from CFA Institute website or any other online source and attempt it as if you are writing the real exam. The score in this mock test will tell you where you really stand. You can identify your weak and strong areas and plan your studies accordingly.
The next step is to set a time period for preparation. You can set this completely as per your time and convenience and could be anything between 50 days to one year. However, you should try not to make it too long as it may dilute your studies.
Now that you have some idea of your level of expertise, it is time to start studying. Take up the first study session. In the first run, your objective should be to complete the entire study session as soon as possible, possible 2-3 days. Remember that you are not trying to learn 100% of the study session the first time. You can only master a subject by revision. Completing the first round early will leave you enough time for revision and practice.
That’s it for this post. In the next post we will look at more tips and specific strategies that will help you in your journey on passing the exam.