CFA exam. really need to study that much?

Finance Guy wrote:

For Level 1, I spent one day reading through the ethics and working through practice problems.

That's kind of what I've been waiting to hear (though you obviously had an extremely strong background)...just wondering how often it happens, since I can guarantee I won't be able to get 100 hours of studying in. There are consequences of not passing the exam the first time, but if I don't pass it by a mandated deadline, well, they gently suggest that we try a new career. Fortunately they will pay for all 3 levels though.

OP: You don't have to give too much away, but it seems kind of absurd that they basically require you to take the test and pass. Are you in the US or UK? It seems like it is much more heavily emphasized in the UK.

ohio_miler wrote:

OP: You don't have to give too much away, but it seems kind of absurd that they basically require you to take the test and pass. Are you in the US or UK? It seems like it is much more heavily emphasized in the UK.

I'd never heard that before, but (without giving too much away), let's just say that that makes sense.

the op again wrote:

That's kind of what I've been waiting to hear (though you obviously had an extremely strong background)...just wondering how often it happens, since I can guarantee I won't be able to get 100 hours of studying in. There are consequences of not passing the exam the first time, but if I don't pass it by a mandated deadline, well, they gently suggest that we try a new career. Fortunately they will pay for all 3 levels though.

It's going to be different for everyone. xlev2 has this correct in that your goal should be mastery of the material, period. I suggested two hours per day as a rough goal, because that's what I did (my employer was kind enough to give me an hour during the work day to study on some days) to crush the exam, but I already had some background and I overstudied in any event.

For some, it will be more like an hour per day and then progressively more as you lead up toward the exam. Others will require three hours per day, and some may just not "have it," no matter how they approach it (One of the guys I hired who had a Masters in Finance from a reasonably credible university and was certainly well versed in the stuff couldn't pass level 1). Practice tests are a must. I cannot remember one single colleague who got through level 2 without crushing level 1 though. I've also heard that level 3 can no longer be taken for granted as well.

To recap/update, I started hitting the books about two weeks before the exam in downtime at work - took a practice right before prep and scored 63 - then took the last week off, during which I took six practice exams. Range on all was 83-88, and I thought the real exam yesterday (at least the morning part) was definitely easier than all of them, so I'd guess I got close to 90, which from what I hear is comfortably passing. I can't imagine starting my studying several months ago, realistically if your goal is to hit > 80% on level I think the most important thing is just to read through the materials shortly before the exam and do practice exams until the big day to keep yourself sharp...someone with a strong background should be able to tackle prep in 3-4 days with full-time studying IMO.

Also I noticed Schweser makes some egregious errors in their materials/practice exams, which I find extremely annoying.

Not to scare you, but usually the easier it feels, the more small things you missed on the questions. Good luck, but you're not out of the woods yet.

ya..... wrote:

Not to scare you, but usually the easier it feels, the more small things you missed on the questions. Good luck, but you're not out of the woods yet.

I know what you mean, like it means you may have overlooked details they put in that would change the answer...I would definitely have a couple of those on most practices, and perhaps I did yesterday, but I did try to be a bit more thorough in reading the questions closely.

Results in yesterday: passed, with top band in 9 of the 10 subsections, and got 50-70% band in the subject I did my masters in (questions they asked were pretty useless IMO). Hope everyone else on the thread did well.

MY QUESTION FOR YOU GUYS IS WHAT REVIEW COURSE IF ANY DID YOU USE FOR CFA LEVEL 1?

THANKS!

So, I'm back for level 2 this year..ordered Schweser last month but have yet to open them yet. Will go on vacation later this week, where hopefully I'll motivate myself to start reading a bit of the material, then 9 days out will go at it gung-ho!

Any similar stories for level 2?

Never took the CFA, but I did take the PMP (Porject Management Professional) exam and my wife took both. My wife said the CFA is like the PMP in that none of the questions are overly difficult, but you have to over study for it becasue there is so much material you can be questioned and it only takes a few misses to fail. So basically, don't look at a few questions and think it's easy becasue you can probably answer 1/4th of the questions with no study, 1/4th with very little study, 1/4th you can logically figure out, but its the final the 1/4th that will get you. Also, you have to understand the nature of how the test makers think, there will be a lot of 2 good answers, with only one being correct in the minds of the test takers.

If the CFA is like the PMP, I would bet the smart (over confident) guys have a higher failure rate. Also, there is no sin in failing and retaking the test, but who wants to go through that pain twice...I suggest you study hard and nail it on the 1st go around.

The CFA is nothing like the PMP in required prep time though. I invested 3-4 months of study per CFA level and more or less squeaked by each time. For the PMP, I 'studied' for literally 2 evenings casually scanning the PMBOK and aced it in less than 90 minutes at the test center. Maybe they share similar question styles (i didnt necessarily think this was true) but either way its apples and oranges in terms of overall effort and difficulty.

Many standardized and certification exams are jokingly easily. But the CFA was the toughest of the many I've taken due to the volume of stuff to memorize. They test you on maybe 5% of the overall content, but which 5%? That's the trick.

L II required a lot more numbers work. Make sure you get day count numbers right. They will put ACT/360, ACT/ACT and 30/360 yields as answers. If you screw up, you think, "Got it!" and move along.

Practice exams are the key.

Ethics is an easy 15%. Spend some time reviewing those texts.

I did L II in '97, so I am sure things have changed.

the OP is back, back again wrote:

So, I'm back for level 2 this year..ordered Schweser last month but have yet to open them yet. Will go on vacation later this week, where hopefully I'll motivate myself to start reading a bit of the material, then 9 days out will go at it gung-ho!

Any similar stories for level 2?

Schweser was adequate back in the day. Sounds like you crushed level I, which is a good sign. Level II is completely different. I don't care how "smart" you are, make sure you know the material and work a lot of problems. One suggestion - When you take the test, read the answers first, then go back and read the questions. In fact, do that with the practice exams so you are accustomed to it.

Sagarin wrote:

Schweser was adequate back in the day. Sounds like you crushed level I, which is a good sign. Level II is completely different. I don't care how "smart" you are, make sure you know the material and work a lot of problems. One suggestion - When you take the test, read the answers first, then go back and read the questions. In fact, do that with the practice exams so you are accustomed to it.

So 24 hours to go, and I've got about 50 pages of Schweser reading left. Started last Thursday, which was perhaps cutting it a little tight...plan on taking two practice tests today, printing out Schweser's Secret Sauce review book to look over tonight (and watch Webb run), then waking up early tomorrow morning to try to memorize the formulas!

Passed!!! By the skin of my teeth apparently, unlike last year when I basically killed it with 9/10 top bands, this year was only 3/10.

Lesson learned - while it's possible to pass L2 on 9 days of study, definitely not recommended, even if you're a good test taker (and especially if you have no accounting/equity valuation background).

Won't leave anything to chance with L3 next year...may even start in early May (though 2-3 weeks prep is a bit more realistic expectation knowing myself).