If you are reading this article it means either you have already registered for the CFA Level-I exam or you are planning to. So before jumping on to the syllabus and how to prepare for the exam let’s understand the exam first.
The CFA exam is organized and conducted by the CFA institute headquartered in Virginia, USA. It is a Non-Profit Organization established in the year 1947. Since then CFA as a career option has gained a lot of attention especially in the financial world, and has covered a long journey in becoming the most prestigious degree today in the finance industry.
Today CFA is recognized and respected in over 165 countries and hence is best suited for people who want to move overseas as it is a course which is recognized globally. The CFA Level- I exam as the name suggests is the first exam in your path to become a CFA Charter holder.
Plan out a study routine and strictly follow it
Most Charter holders give credit to their study routine and plan behind the success of becoming a Charter holder. Since, CFA is a completely analytical exam you not only need to read the material thoroughly but also understand it in such a way that you can apply the concept in different situations because that is how you are tested in the exam.
To achieve this you need a lot of hours of preparations hence it is recommended to start early and follow a routine. An average candidate studies for about 450 to 600 hours to be exam ready. Also you need to keep the last 30 days only for the practice questions and mocks and other question banks.
Typically it is suggested to divide your timing in the below manner once you have a schedule ready:
|Activity||Percentage of Total Time|
|Preparing||30-40% of the total time|
|Practicing||40%-50% of the total time|
|Performing||20% of the total time|
Exam Weights and topics
There are a total of 10 subjects and each subject has a different weightage in the exam and it is very crucial to keep that in mind and prepare accordingly. Every topic is divided as Learning Outcome Statements (LOS).
CFA institute places Ethics as a characteristic to the highest priority and hence it is important to focus on Ethics as many candidates avoid it assuming to be a sub topic and leave it for later. Make sure you get a strong hold over Ethics.
Also the exam pattern and weightages keep changing every year so make sure to use the latest materials and videos and stay updated. At the start of every LOS the institute mentions what is the main objective of that LOS, so make sure to read that and study that LOS accordingly, for example- if the LOS says calculate, it means you will be asked to solve numerical from that topic, if the LOS says describe the institute only wants you to understand that topic and no numerical will be asked from that topic.
Hence, it is very crucial to first analyze what exactly the institute is trying to impart from a particular topic and then prepare accordingly.
Mocks and questions
This is literally the key to cracking the exam, going through the material and videos won’t help clear the exam. Practicing as many questions as possible giving as many mocks as possible is the key to clearing the exam.
The end of chapter questions of the CFA Institute and the practice questions in the CFA website should be answered at least 2-3 times and analyze which ever questions you answered wrong.
Coming to mocks, appear for all three mocks available on the CFA website and all 3 mocks provided by Kalpan Schweser as these are prepared in the exact same format and weightage as the exam is and is usually slightly difficult than the real exam and hence are perfect to give a real feel of the exam and show where exactly do you stand and which areas do you need to focus more on.
Appear for some of the mocks about 15 to 20 days before the exam so that you can improvise on the areas where you are lacking behind and then give some mocks 3 to 4 days before the exam to see the improvement.
Also never be demotivated by looking at the score of the mocks, that is not the purpose of giving mocks rather try to see where did you go wrong the reasons behind those mistakes and improvise on them.
- Prepare a formula sheet subject wise and if possible understand the formula rather than memorizing.
- Follow your planned routine and do not deviate from it.
- Make your own notes subject wise and keep them handy.
- Go through the questions you answered wrong.
- Focus more on practicing rather than studying.
- Take a day’s break after every 10 days to release stress.
- Do not take Ethics lightly.
- Watch videos if reading feels exhaustive.
- Be a part of CFA groups in whatsapp as a lot of important information is shared in them.
- Last but not the least Study Hard and Study Smart.
List of study materials and a brief on them
CFA Institute books- When you successfully register for the Level-I exam CFA institute provides you with 6 books covering all the 10 topics.
The institute provides a soft copy of the books and if you wish to get a hard copy of the same you need to pay an additional $150 for it.
The CFA institute books are the best study material but only if you have plenty of time, if you have a minimum 6 months left for the exam only then should you refer the CFA Institute books because there are a total of about 4,000 pages and you cannot afford to skip topics.
The End of chapter questions on these books are the best to solve some questions after understanding a topic to get a feel of the type of questions asked in the exam.
Kaplan Schweser- This is probably the most widely used material for CFA Level- I exam. The best part here is that it covers every topic but briefly, so it is not as lengthy as the CFA Institute books.
The end of chapter questions here also is very crucial from the exam perspective. You get 3 additional mock papers within the book set which is very useful and gives a real feel of the exams.
Wiley- This is another 3rd party prep provider and again is very widely used among the candidates. Although the language here is not as easy as Kaplan and hence, beginners might struggle here initially to get hands on.
The WallStreet School’s Online Course covers all aspects of the preparation as it a CFA Approved Prep Provider, which is a good option for the students who don’t want the hassle of going through all different resources and want everything at one place.