Saumya JainAssistant Manager- Content
CFA preparation: Students planning to appear for the Chartered Financial Analyst program (CFA) must have a well-planned and structured preparation plan and strategy. Preparation for all three levels of the CFA exam requires serious commitment. As per the latest reports, the 10-year average pass rate of the CFA exam has been 41%, 45% and 52% for Level I, II and III respectively. The pass rate for the August 2023 Level I exam was 37% and that of the May 2023 Level I exam was 39%. These statistics show that clearing the CFA exam is not a cakewalk and requires dedication. Shikha brings some CFA preparation tips to crack the CFA exam 2024.
Also Read: CFA 2024 dates
Q: Is there an age limit to appear for CFA?
There is no specific age limit for candidates who wish to take the CFA exams. The CFA Institute, which administers the CFA Program, does not impose age restrictions on candidates. The CFA Program is open to individuals from a wide range of educational and professional backgrounds, and candidates can pursue the CFA charter at any age, provided they meet the educational and work experience requirements.
However, it's important to note that to become a CFA charterholder, candidates must meet the following minimum eligibility criteria, which do not include an age requirement:
- Candidates must have a bachelor's degree from an accredited institution or be in the final year of their bachelor's degree.
- Candidates must have four years of qualified work experience in the investment decision-making process. This experience can be obtained before, during, or after taking the CFA exams.
- Candidates must agree to adhere to the CFA Institute's ethical and professional standards.
Upvote 
Q: Can I use third-party study materials to supplement the CFA syllabus?
Yes, you can use third-party study materials to supplement the official CFA curriculum and enhance your CFA exam preparation. Many candidates find that using additional study resources from reputable providers can be highly beneficial. Third-party study materials often provide comprehensive coverage of the CFA exam curriculum. They condense and explain complex topics, making them easier to understand. Some third-party providers offer concise study notes that summarize key concepts and formulas. When using third-party study materials, it's essential to choose reputable providers with a track record of success. The CFA Institute provides a list of approved prep providers on its website, which can be a good starting point.
Upvote Q: Is the CFA syllabus updated regularly?
Yes, the CFA syllabus is updated regularly to reflect changes in the investment industry and to ensure that candidates are prepared for the latest industry practices and trends. The CFA Institute, the governing body for the CFA exam, reviews and updates the syllabus on a regular basis, typically every three to five years.
For example, the CFA Institute updated the Level I syllabus in 2020 to include new topics such as digital assets and sustainability, and to reflect changes in the investment industry. The Level II and Level III syllabi were also updated in 2020 to include new topics and to reflect changes in the industry.
This year, a new chapter titled – “Introduction to Geopolitics” has been introduced under the Economics section for the Level I CFA syllabus. Corporate Ownership and Structures and Business Models are the two new readings that have been added under Corporate Issuers section. Major changes to the Capital Structure readings have been made. Minor changes to the Introduction to Corporate Governance & Other ESG Considerations reading has also been made for the Level I CFA curriculum.
Upvote How to Prepare for CFA Exam?
According to the successful CFA candidates, they’ve spent over 300 hours preparing for their CFA preparation. The best way to prepare for the CFA exam is by dedicating ample time to the CFA preparations. Students who are very new to the CFA syllabus may be required to spend a bit more time comparatively.
Also Read:
CFA Syllabus 2024
Candidates appearing for the CFA exam need to clear three levels of the examination conducted by the CFA Institute, i.e. Level I, Level II, and Level III. The CFA syllabus for all three sections is identical. The difference lies in the weightage given to each topic at a particular exam level.
Check below the CFA syllabus along with the topic weightage in the exam.
| CFA Subjects |
Weight Given in CFA Level 1 |
Weight Given in CFA Level 2 |
Weight Given in CFA Level 3 |
|---|---|---|---|
| Ethical and Professional Standards |
15-20 |
10-15 |
10-15 |
| Quantitative Methods |
8-12 |
5-10 |
N/A |
| Economics |
8-12 |
5-10 |
5-10 |
| Financial Statement Analysis |
13-17 |
10-15 |
N/A |
| Corporate Issuers |
8-12 |
5-10 |
N/A |
| Equity Investments |
10-12 |
10-15 |
10-15 |
| Fixed Income |
10-12 |
10-15 |
15-20 |
| Derivatives |
5-8 |
5-10 |
5-10 |
| Alternative Investments |
5-8 |
5-10 |
5-10 |
| Portfolio Management and Wealth Planning |
5-8 |
10-15 |
35-40 |
Also Read:
Q: Which are the most important topics to focus for CFA preparation?
Upvote Q: Can a B.Com finance student prepare for CFA?
Upvote CFA Preparation Tips
Check out some of the CFA preparation tips below to ace the CFA exam:
- Develop a Study Plan Six Months in Advance: Whether students plan to study for 300 hours or more, having a concrete and strategic study plan is very important to ace the CFA exam. They must fully dedicate themselves to the decided study hours and diligently follow the routine. To follow the routine and adapt to it, candidates should try to create a study plan six months in advance and spread the preparation and syllabus over these months in a way that they are able to cover the complete CFA syllabus whilst leaving room for revision.
- Target at least 300 hours to study: The CFA study material is not difficult to understand but the difficulty lies in the vastness of the CFA syllabus. This can be a big challenge, especially for those who are new to the field. As mentioned above, many students who have passed the CFA exam have spent over 300 hours to prepare for the CFA exam. Students, in our opinion, should not spend any less than this and target 300 hours minimum.
The following table summarizes how to best allocate the study time for the various CFA exam topics if candidates were to give themselves about 323 hours and four months (120 days) to study. Students can use this table as a benchmark and customize their study routine to suit their circumstances.
| CFA Level I Exam Topic Areas |
|||
|---|---|---|---|
| Topic Area |
Weight |
Hours based on 323-hour schedule |
Days to allocate |
| Ethical and Professional Standards |
15%–20% |
54 |
20 days |
| Quantitative Methods |
8%–12% |
31 |
12 days |
| Economics |
8%–12% |
31 |
12 days |
| Financial Reporting and Analysis |
13%–17% |
46 |
17 days |
| Corporate Finance |
8%–12% |
31 |
11 days |
| Portfolio Management |
5%–8% |
20 |
8 days |
| Equity Investments |
10%–12% |
35 |
12 days |
| Fixed Income |
10%–12% |
35 |
12 days |
| Derivatives |
5%–8% |
20 |
8 days |
| Alternative Investments |
5%–8% |
20 |
8 days |
| Total |
100% |
323 |
120 days |
- Take a CFA Prep Course: Students preparing for the CFA exam, should consider taking a CFA prep course. Taking a CFA prep course will help them stay on track and also aid in monitoring their progress. CFA preparation courses have detailed study plans and give access to a lot of study material. They also help the students in identifying their strengths and weaknesses which in turn will help them manage their time efficiently. They prepare students for the CFA exam day too.
- Use Notes and Summaries to Memorize Concepts: Students have to broadly study four major areas, namely, Financial Reporting and Analysis, Portfolio Management, Economics and Statistics. Students will have to memorize a lot of concepts, theorems, formulae, etc. to cover the CFA syllabus. Creating structured notes and summaries of the key concepts and formulas will help the students in revision as well as overall CFA preparation. Focus on the concepts that appear most frequently in the question stems, and give less time to the concepts that appear
- Practice: CFA exams are lengthy (6 hours for each level), so time management is very important. Studying and reading the CFA syllabus is one thing, but it is equally important to put that knowledge into practice to increase the chances of success. The CFA Institute provides candidates with a lot of CFA mock exams and practice questions in their CFA preparation books, so start there. Then, students should find the topics they are weakest in and focus on reviewing those. Then they should move on to attempting CFA mock tests at least two months before the exam.
- Befriend Your Financial Calculator: During the CFA exams, students will be allowed to carry one of two specific calculator models, i.e. Texas Instruments BA II Plus (including BA II Plus Professional) and Hewlett Packard 12C (including the HP 12C Platinum, 12 C Platinum 25th Anniversary edition, 12C 30th Anniversary edition and HP 12C Prestige). Students should practice at home with the calculators they own so that they know how to best use them and there is no hassle on the CFA exam day.
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Q: How can I prepare for CFA?
Preparing for the CFA (Chartered Financial Analyst) exam requires a systematic and disciplined approach. Here are some steps to help you with your preparation:
Familiarize yourself with the exam structure, including the number of levels, topic areas, and the weightage assigned to each topic.
Develop a comprehensive study plan that covers all the topics and allows for sufficient time for review and practice. Set realistic goals and create a schedule that works for you, taking into account your other commitments.
The CFA Institute provides official curriculum materials that cover all the exam topics in detail. Make sure to study from these materials as they are comprehensive and aligned with the exam content.
Practice is crucial for success in the CFA exam. Solve mock exams and practice questions to get familiar with the exam format and to assess your understanding of the topics. Review your performance and identify areas that require further study.
Engage with other CFA candidates through study groups or online communities. Discussing and exchanging ideas can enhance your understanding of complex topics and provide additional support during your preparation journey.
The CFA exam is concept-driven, so it's essential to develop a strong understanding of the underlying principles and theories. Avoid rote memorization and strive for a deeper comprehension of the material.
Regularly review the topics you have studied to reinforce your knowledge. Create concise notes or flashcards to summarize key concepts, formulas, and important details.
- The CFA curriculum undergoes periodic updates. Stay informed about any changes or updates to the syllabus and adjust your study plan accordingly.
Remember, the CFA exam requires dedicated effort and perseverance. It is essential to stay disciplined, motivated, and consistent in your study routine. Good luck with your CFA preparation!
Upvote Q: Which are the best books to refer for CFA exam preparation?
Candidates can prepare for the CFA 2023 certification course by reading many reference materials mentioned below-
Name of Books | Authors |
|---|---|
Investment Banking: Valuation, Leveraged Buyouts, and Mergers & Acquisitions | Pearl and Rosenbaum |
2021 CFA Level I | Kaplan Schweser |
Strategic Value Investing: Practical Techniques of Leading Value Investors | Stephen M. Horan, Robert R. Johnson and Thomas R. Robinson |
When Genius Failed: The Rise and Fall of Long-Term Capital Management | Roger Lowenstein |
The Cartoon Guide to Statistics | Larry Gonick and Woollcott Smith |
CFA Level I | Bhupesh Ananad |
The Handbook of Fixed Income Securities | Frank J. Fabozzi |
Note- The information is sourced from external sites and may vary.
Upvote Q: What are the important tips to balance work life and exam preparation for CFA?
Upvote CFA Preparation: Exam Day Tips
No preparation is worth it if you falter on the exam day. Check below some of the CFA exam day preparation tips to improve your chances of scoring well in the CFA exam:
- Reach the CFA exam centre on time: Candidates appearing for the CFA 2024 exam have to visit the CFA test centre in order to take the exam in the computer-based test mode. The exam will be conducted for two hours and 15 minutes per session. Candidates must ensure that they reach the exam centre at least 30 minutes before the exam time in order to avoid any hassle and panic on the exam day.
- Things to carry to the exam centre: Students appearing for the CFA 2024 test must carry a printout of the confirmation email with their appointment confirmation number on it along with an international travel passport. Candidates should also carry a calculator e. Texas Instruments BA II Plus (including BA II Plus Professional) and Hewlett Packard 12C (including the HP 12C Platinum, 12 C Platinum 25th Anniversary edition, 12C 30th Anniversary edition and HP 12C Prestige) along with loose batteries and keystroke cards. No other stationery items are permitted in the CFA exam hall.
- Things prohibited in the CFA exam centre: Candidates appearing for the exam should not carry any stationery items such as paper, pencils, etc. Candidates should also not carry any eatables or drinks to the exam hall. Baggage of any kind, including transparent bags, backpacks, handbags, tote bags, briefcases, luggage, carrying cases, passport covers, hat or eyeglass cases, wallets, etc. is strictly prohibited. Candidates should also not carry any kind of electronic gadget such as mobile phones, cameras, tabs, laptops, smartwatches, etc.
To conclude, candidates should be calm throughout the CFA preparation. Although CFA is tough, preparing properly in advance and using a strong study strategy and study guides will help you pass the exam on your first try. It is also important to relax, and not freak out while studying for the exam.
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Q: What should I wear on the CFA exam day?
There is no dress code, so wear what you’re comfortable in – within reason, of course. We recommend that you dress in layers so that you can adjust and keep comfortable as needed. Candidates must make sure that they reach the exam centre at least an hour before the exam starts. It is not mandatory to wear suits to the CFA exam centre. The attire should be decent and comfortable.
Upvote Q: Will there be a place to keep things that I cannot bring into the CFA exam hall?
Candidates may or may not be provided with a private locker at the CFA exam centre. However, candidates can always visit the CFA exam centre a day before the exam so to know the location of the exam centre, the time it would take for you to reach the centre and also if the locker service is available at the alloted exam centre or not. The exam will be conducted in the computer-based test mode, hence, the candidates should only bring the necessary things with them.
Upvote Q: Should I use the optional 30 minute break in the CFA exam? What should I bring for the break?
Yes, we think it is useful to have that break. You can use it to have a light snack, drink and use the toilet before heading in for the second session. It’s actually not a long break. You won’t be allowed to eat snacks or drink during the exam, but you can and should bring your own light snack and water – something that keeps well in room temperature for your optional 30 minute break. Going back in late for second session will eat into your exam time, so be mindful of this.
Upvote FAQs on CFA Preparation
Check below some of the frequently asked questions (FAQs) on CFA preparation:
Q: How tough is the CFA exam? What are important preparation tips for the CFA exam?
The CFA exam is known to be tough, and passing it requires a serious commitment to following a structured study plan. According to the CFA Institute, the average annual pass rate over the last 10 years for the CFA Level I exam has been 44%, and the recommended study time is about 300 hours. Here are some important preparation tips for the CFA exam:
- Focus on the most-tested material and develop a study plan six months before you take the exam
- Take a prep course and use third-party resources to save time
- Allocate study time based on each topic's weight and practice questions regularly
- Be good at taking the CFA exam, work on quick recall, and understand the questions
- Familiarize yourself with the data-backed study habits linked to passing the exam
- Start studying early, and start right
- Clear your CFA plan with family and friends and understand the time commitment required to pass the exam
- Apply CFA exam concepts to real life and learn how to take the CFA exam
Upvote News & Updates
Get all exam details, important updates and more.
CFA Exam Exam
Student Forum
Anything you would want to ask experts?Answered a month ago
Here are some practical tips to help you perform your best on the CFA exam.
- Financial Statement Analysis: Questions on this topic are based on International Financial Reporting Standards (IFRS) unless otherwise noted. If a question references U.S. GAAP, this will be explicitly stated.
- No penalty for g
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Contributor-Level 10
Answered a month ago
Follow the steps mentioned below to learn how to fill out the CFA application form
- Visit the official website of the CFA institute
- Click on the application link or copy https://login.cfainstitute.org/LoginApplication.
- Create a login account with the candidate’s email ID.
- The candidate will be asked to e
A
Contributor-Level 10
Answered a month ago
CFA Charter Holders have the distinct advantage of applying their skills in several professional roles. They can work in areas like wealth management, hedge funds, fixed income, insurance and equity research.
A
Contributor-Level 10
Can you share some tips to prepare for CFA exam?