The Most Common Reasons People Fail the CFA® Exam


To say that the CFA® Exam is challenging would be an understatement. With the pass rates for all levels hovering around 50%, many candidates don’t pass the exam, but the question is, why? This article will explore the top four reasons why people fail the CFA Exam.

1) Too Reliant on Passive Learning

Unfortunately, too many students have been taught to learn by using passive learning techniques. Most learning has traditionally been by listening to lectures; the only “active” aspect is when students take notes on those lectures. As a result, most students struggle to perform well in exams because they don’t adequately retain the information conveyed by those lectures.

By contrast, active learning is one of the most effective ways to improve learning outcomes and memory retention. Neuroscientists from U.C. Berkeley confirm that it is possible to enhance one’s critical thinking and reasoning skills when taking an active approach to processing and analyzing data. For example, instead of sitting back and watching boring videos or listening to tedious lectures, answering practice questions will challenge your brain to analyze, evaluate, and synthesize information. Similarly, using flashcards with spaced repetition is an active-learning method that hacks your brain to better retain information presented over specific intervals.

Here are a few ways to switch from passive to active learning:

  • Rather than memorizing individual concepts, learn how those concepts fit into the “bigger picture.”
  • Understand why the correct answer is correct (and why the incorrect answer is incorrect).
  • Determine how you chose an incorrect answer by reviewing the rationales for the correct and alternative answer choices.
  • Identify your strengths and weaknesses, and focus on the relevant CFA Exam sections in which you underperform relative to others.
  • Reinforce your knowledge using your preferred learning style. If you’re a visual learner, create diagrams that illustrate the concepts; if you’re an auditory learner, talk through challenging CFA concepts with peers.

2) Poor Time Management

When it comes to studying, the golden rule is quality over quantity. Studying for more hours or pulling all-nighters rarely results in desired learning outcomes. On the contrary, the more you study without breaks leads to diminishing returns, not to mention mental exhaustion. Studies have shown that these study habits can instead reduce the long-term retention of information.

What matters more than how long you study is how well you study. How do you manage the hours you spend studying? Use the following strategies to maximize what you learn when studying:

Practice relevant concepts tested on the CFA Exam.

By focusing on what you are most likely to encounter on the actual exam, you avoid wasting time on irrelevant subjects. Our UWorld CFA Level 1 Learning Platform features 2,000+ instructive questions modeled after the exam blueprint and covering all Level 1 learning outcome statements (LOS)

Practice in test-like conditions to build stamina and endurance.

Take mock exams to improve your chances of completing the exam on time by familiarizing yourself with test-taking under pressure. For example, our UWorld CFA Mock Exams get you ready for the actual exam in the following ways:

* First, they closely resemble the actual CFA Exam in all respects, from the interface to the topic weightings.
* Like the actual CFA exam, our mock exams consist of two 2-hour, 15-minute sessions, each with 90 multiple-choice questions not included in the QBank.

Improve your weaknesses.

Dedicate more time to your weaker exam sections so you can improve.

Be disciplined about your dedicated study time.

Eliminate all distractions, including social outings and unproductive extracurricular activities.

Performing well on timed assessments like the CFA Exam requires proper time management. Practicing thousands of questions testing relevant high-yield CFA concepts is a more efficient way to learn the material in the limited time available to you, considering your other responsibilities.

3) Bad Habits

From cramming to procrastination, old habits die hard and may be preventing you from realizing your full potential. As adults, we sometimes have to unlearn bad habits we have accumulated since childhood. For example, you may be a perfectionist who spends too much time poring over one subject area you are already good at and not enough time for areas that need more of your attention. This can hurt your performance on exam day. Consider the following suggestions to break these bad habits:

  • Avoid procrastination. Cramming may have worked in grade school, but it is an ineffective way to prepare for a long and grueling high-stakes exam.
  • Mind your mental health. Find healthy ways to relieve stress and avoid burnout before the CFA Exam. Take study breaks and make time for adequate rest.
  • To err is human; to improve is divine. Don’t obsess over perfection so much that you never allow yourself time to complete your mock exams. Remember that practice will make you better, not perfect. But as long as you are good enough to pass the exam after studying efficiently, you will have achieved your goal.
  • Build a support system. Everyone has some measure of test-taking anxiety, especially in high-stakes exams like the CFA Exam. So, don’t hesitate to ask for help when you need it. Talk to your friends, family, or a professional. Here are some other useful techniques to overcome test-taking anxiety.

4) Insufficient Prep Materials

While you will likely use the materials that CFA Institute sends you when you register for the CFA Exam, preparing for the CFA Exam using only the CFAI curriculum probably won’t be enough. Despite CFA Institute’s materials giving you the entire curriculum for the exam level you are taking, CFA candidates who resort to using these materials exclusively may be limiting their chances of success. That may sound ironic at first, but anything in the curriculum can be tested on the CFA Exam, and that volume of material can lead you to some of the bad study habits we mentioned above.

Does this mean you should ignore the curriculum?  No, but studying with a trusted third-party provider like UWorld in conjunction with the  CFAI materials can help you more efficiently prepare for the CFA Exam. Our comprehensive CFA Level 1 Online Learning Platform is built to optimize your success and tailored to your specific learning style and study preferences while giving you all the tools you need to pass the Level 1 CFA Exam. Using both the CFAI materials and UWorld’s could boost your confidence in knowing that you have mastered the material from two trusted sources.

Now that you know some of the common reasons why students fail the CFA Exam, you can be better positioned for success. By studying relevant concepts, managing your time better, creating successful habits, and preparing with a third-party prep provider, you can increase your chances of success on exam day.

As you make sure to avoid these top reasons students fail, study with a robust prep provider; click here for a FREE trial of our CFA Level 1 Learning Platform.

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