I remember preparing for the CFA Level 1 exam like it was yesterday. As a college grad, I was stoked to take a step towards a financial career, but I knew if I was going to pass the CFA exam, it was going to require an investment. After some 300 hours of study, my investment paid off, and I passed the exam. With dedication and the right study approach, you can pass, too. – James Fang, CFA
If you are considering taking the CFA Level 1 exam, there are a few things that you should know before you start studying.
Get Familiar With CFA Exam Structure
The CFA Level I, Level II, and Level III exams have a structured format and require a significant amount of time, effort, and dedication to prepare for and pass. The exams are computer-based tests, and they are administered at testing centers around the world. The CFA Level 1, Level 2, and Level 3 exams cover the same finance topics, which require a deep understanding of complex concepts and theories. Topics are weighted differently as you progress through each level.
The CFA Level 1 exam format consists of 180 multiple-choice questions, split between two 2.25-hour sessions to be completed the same day. There is an optional break between sessions. I recommend taking a break if you need to clear and recharge your mind.
Know What is Tested on the CFA Level 1 Exam
On the CFA Level 1 exam, the first session covers the topics of ethics and professional standards, quantitative methods, economics, and financial statement analysis. The second session covers the topics of corporate issuers, equity, fixed income, derivatives, alternative investments, and portfolio management.
Here is the current weighting for the 2024 exam season:
Suggested Chart – Source: CFA Institute
Follow These Top 6 CFA Level 1 Exam Prep Tips
According to the CFA Institute (CFAI®), the 10-year average pass rate for the CFA Level 1 exam is 41%. The average pass rate for the CFA Level 1 exam 2023 was 38%. Although most candidates would say that the CFA Level 1 is the easiest of the three levels to pass, only about one of every three candidates passes. With this in mind, you’ll need a solid study approach to help prioritize essential topics.
- Have a Study Plan – set aside specific times each day to study. Allocate enough time for each study session to cover your chosen topics for the day and make sure to take regular breaks. To manage your schedule and prioritize tasks use a CFA exam digital study planner.
- Start Early – begin studying at least six months in advance and map out a plan that tackles all of the material on the CFA Level 1 exam. This will help you master each topic and avoid last-minute cramming.
- Goal 300 Hours – remember this formula: To complete 300 study hours in 6 months, you should study for at least 2.5 hours every day for 5 days per week, or you can study a total of 12 hours a week according to your customized study plan.
- Test Your CFA Level 1 Exam Knowledge Weekly – to truly master the concepts, test your knowledge by answering QBank practice questions on a daily basis and by taking mock tests weekly. Check out CFA QBank resources to test your knowledge, like the UWorld CFA Level 1 QBank, which features hundreds of practice questions with detailed explanations to help you master concepts. The UWorld QBank also offers performance metrics, to show which topics you are rocking and which topic areas need improvement.
- Stay Focused and Healthy – find a quiet, comfortable study space, eliminate distractions and turn off digital devices that you are not using to study. Focus on one task at a time to stay productive and to avoid feeling overwhelmed. Make sure you eat and sleep well and take care of yourself to fuel your brain.
- Build exam day stamina – take practice exams in exam-like conditions with timed sessions at least 2-3 months before the exam. Use tools and materials that have the same format as the exam to get a feel for the format and structure. This will help you to pace yourself during the exam.
The CFAI provides the official curriculum and study materials, which can be accessed on your laptop, tablet, or mobile phone. These study materials include a detailed study guide for each level of the exam with the official curriculum, mock tests, and exam format practice questions. But you’ll also want to use additional digital resources to complement the CFAI study materials that include performance metrics to track your progress by topic, like the UWorld CFA QBank, Video Lectures, Live Classes, and much more.
Exam Day Prep
On exam day, stay focused and don’t stress – stay positive, and answer every question on the exam. Remember, your worth isn’t determined by one test alone – candidates have a total of six attempts to pass the CFA Level 1 exam. Stick to your study plan and follow the 300-hour study rule. This way, you’ll increase your chances of not only passing the exam but also passing with a top score. Take a deep breath – you’ve got this!