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CFA

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First of all hearty congratulations on clearing your CFA Level-I.

CFA level- II Exam is the next step towards getting your CFA Charter and is more focused towards the valuations of all the asset classes, most candidates believe that this is the most difficult and brutal of all the 3 levels, but I beg to differ. If you have prepared well enough, have devoted your time and energy towards it, then it is not so difficult, the key here is to focus more towards understanding the concepts and reasons behind everything rather than memorizing it.

 So let’s understand everything there is to know about it without further ado.

Syllabus

Just like Level-I, here also there are 10 subjects in total but there is a slight twist here with respect to the weightages of the subjects, as the weightages in Level-II are given on a range basis and the weightages will vary in between that range. So, let’s have a look at the same:

Subject Weightage
Equity Valuation (10- 15%)
Fixed Income (10- 15%)
Financial Reporting and Analysis (10- 15%)
Derivatives (5- 10%)
Alternative Investments (5- 10%)
Economics (5- 10%)
Portfolio Management (10- 15%)
Corporate Finance (5- 10%)
Ethical and Professional Standards (10- 15%)
Quantitative Methods (5- 10%)

Fees

The enrollment fee of USD 450 is not required here as it valid throughout the CFA program when you paid for it in your Level-I registration. So, now you only have to pay for the Level-II registration fee which again varies depending on the time of your enrollment.

TypeAmount
Early registration fees USD 700
Standard registration fees USD 1000
Late registration fees USD 1450 

Exam Pattern

The CFA Level-II exam is a completely Multiple Choice Questions (MCQ) based exam. Also here the pattern is slightly different from Level-I as in here you will get about 20 item sets of about 2-3 pages each and there will be 6 questions based on each item set, coming to a total of 120 questions. It is an Offline Exam and can be given in the venues provided by the CFA Institute which the Institute communicates via E-mail a month before the exam. It is a 6 hour based exam which is divided into two parts of equal time. There is a 2-hour break in between for your lunch and other activities.

  • Morning session– This is the 1st part of the exam and is of 3 hours which consists of 60 MCQ questions and 10 item sets, which can be based on any of the subjects.
  • Afternoon session– This is the 2nd part of the Exam which also is of 3 hours and consists of 60 MCQ questions and 10 item sets, which again can be based on any of the subjects.

On average you get about 3 minutes to answer each question whereas you were getting 1.5 minutes per question in CFA Level-I, hence you can expect more time to answer each question this time.

Documents and Eligibility required to enroll for the CFA level- II Exam:

All the documents that were required to appear for CFA Level-I, also this time you need to be a college graduate, being in the final year is not allowed, you have to be a college pass out. Again a valid International Travel Passport is mandatory.

Average Salary of a CFA Level- II cleared:

These figures are for the ones who have no prior work experience and have just started with their careers:

  • In India: Average Pay for a CFA Level II cleared in India is around 4.5- 7 L.P.A. for someone who has just started out with his career. Note- getting into a core finance profile such as Valuations, Investment Banking, etc. right after CFA Level- II is not very easy and you might have to gain some prior work experience or right connections in the industry. I would advise to stay active in LinkedIn and stay in constant touch with the people in the industry.
  • In US: Average Pay for CFA Level- II cleared in US is about $45,000 annually for a newbie who has just stared out.

Job Profiles after clearing CFA LEVEL- II

Most of the job profiles you can expect after clearing your Level-II would be buy-side equity research analyst as it is the most common and a decent paying job. Apart from this, you can look for other jobs like Investment Banking, Credit Analyst, Bond Market Profiles, Trader, etc.

How much time it requires to study for CFA Level- II

On average it is estimated by the CFA Institute that a minimum 300-hour preparation is required for CFA Level- II, although this is a very ballpark figure as it very much depends upon prior knowledge, experience, grasping skills and various other factors. Most people suggest that about 500- 600 hours is a good amount of time to be well prepared for the big day.

How to prepare for CFA Level- II

Level II focuses more on your valuation skills and techniques and hence it is very crucial to understand how different asset classes are valued and which technique is better suited under which scenario.

Solving as many questions as possible is the best way to bring in the time efficiency and confidence level. The most important thing is to solve the questions at the end of each chapter of CFA Curriculum Books and Schweser Books and all the questions on the CFA Website (Practice Questions).

Apart from this, try to give a minimum of 8-10 mocks, especially the CFA Website mocks and the Schweser mocks as these will give you a lot of ideas on how to answer in the real exam.

Passing Rate:

On Average about 45% of the candidates who appear for the exam clear the CFA Level-II.

Things you should carry in the Exam hall:

  • BA Plus II Calculator/ BA Plus II Professional Calculator
  • A set of Pencils
  • A rubber
  • A Pencil sharpener
  • A watch (Not a Smart Watch)
  • An extra battery for you calculator along with a screwdriver

CFA level- I Exam is the stepping stone on this beautiful journey of becoming a CFA Charter holder, this is where the hardworking yet blissful journey starts. So let’s understand everything there is to know about it without further ado.

Syllabus

There are 10 subjects in total in the CFA level 1 curriculum along with their respective exam weightages:

TopicWeightage
Equity11%
Fixed Income 11%
Financial Reporting and Analysis 15%
Derivatives6%
Alternate Investments 6%
Economics10%
Portfolio Management6%
Corporate Finance10%
Ethical and Professional Standards15%
Quantitative Methods10%

Fees

There is a one-time USD 450 enrollment fee which is required when you enroll for the 1st time for the CFA Level-I exam. It is valid throughout your CFA journey no matter how many attempts you appear for. Apart from this there is a registration fee for the CFA Level-1 exam which varies depending on the time of your enrollment.

Early registration feesUSD 700
Standard registration feesUSD 1000
Late registration feesUSD 1450

Exam Pattern

The CFA Level-I exam is a completely Multiple Choice Questions (MCQ) based exam. It is an Offline Exam but from 2021 onwards The CFA Institute has decided to make CFA Level-1 Exam a completely online-based exam, although the pattern remains the same. It is a 6 hour based exam which is divided into two parts of equal time. There is a 2-hour break in between for your lunch and other activities.

  • Morning session– This is the 1st part of the exam and is of 3 hours which consists of 120 MCQ questions, which can be based on any of the subjects.
  • Afternoon session– This is the 2nd part of the Exam which also is of 3 hours and consists of 120 MCQ questions, which again can be based on any of the subjects.

Eligibility criteria to enroll for the CFA level- I Exam

The candidate must have a valid International travel Passport, and one of the following –

  • The Candidate must have a bachelor’s degree or must be in final year student at the time of enrollment as you need to submit the documents of the same for your Level-II Exam.
  • 4 years of professional and fulltime work experience (not necessarily investment related).
  • Or a combination of work experience and education totaling 4 years.

Average Salary of a CFA Level- I cleared candidate

These figures are for the ones who have no prior work experience and have just started with their careers:

  • In India: Average Pay for a CFA Level 1 cleared in India is around 3-4 L.P.A. for someone who has just started out with his career. Note- getting into a core finance profile such as Valuations, Investment Banking, etc. right after CFA Level- I is not very easy and you might have to gain some prior work experience or right connections in the industry.
  • In US – Average Pay for CFA Level- I cleared in US is about $35,000 annually for a newbie who has just started out.

How much time is required to study for CFA Level- I

On average, it is estimated by the CFA Institute that a minimum 300-hour preparation is required for CFA Level- I, although this a very ballpark figure as it very much depends upon prior knowledge, experience, grasping skills and various other factors.

How to prepare for CFA Level- I

There is no one way to this, as everyone has their own methods and techniques of preparations, some like to go slow, whereas some rapidly catch up in the last couple of weeks.

Mostly the research suggests that the more mock papers one gives the more your chances increase of passing the exam, apart from mock exams the end of chapters questions from CFA Institute books are highly recommended, the CFA institute questions available online are also a good measure to test yourself before the big day.

Usually, you should consider giving at least 10-12 mocks before the exam and carefully examine the results of those mocks. The most important mocks are the CFA Institute website mocks and the mocks given by Kaplan Schweser, these are like the building pillars for you to prepare before the exam.  

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Things you should carry in the Exam hall:

  • BA Plus II Calculator/ Ba Plus II Professional Calculator
  • A set of Pencils
  • A rubber
  • A Pencil sharpener
  • A watch (Not a Smart Watch)
  • An extra battery for you calculator along with a screwdriver