Chartered Financial Analyst (CFA) is a high-level professional certification program offered by the internationally recognized American institute to investment and finance professionals.
The program consists of three meticulous levels: CFA Level I, Level II, and Level III, and each level’s exams that a student must pass. After passing, every candidate must meet specific work requirements from the CFA institute to get the professional certification.
CFA is a universally recognized and worthy certification, enabling you to work in top investment firms and banks worldwide and receive handsome pay for your work. Millions of people enter this certification program to excel in their careers.
However, passing the CFA levels can be incredibly challenging, so we have this guide to help you prepare for your CFA exams. Some helpful study tips like practice questions, mock exams, moderated message boards, mentorship, and curriculum games can place you ahead of the lot. Therefore, let us look at how you can be smart about studying for your CFA.
Focus on the Most Tested Material
When it comes to CFA exams, you must examine a pattern of its questions and the things they focus on the most. Make it a point to start preparing for such material first. For example, questions about Ethics and Professional Standard appear the most on the CFA exam. For further helpful tips, you can follow Wiley CPA prep to understand the tested material better.
Questions on Technical Analysis, Derivatives, Portfolio Management and Wealth Planning are few in the Level I exam. However, it does not mean that you can skip them. After preparing for high-volume question topics, you can focus on these.
Have a Study Plan
For CFA exams especially, you must start studying early. It is not the kind of exam preparation that you can do last minute. Aim to start preparing 5-6 months prior to your Level I exam.
Level I typically requires 300 hours of rigorous study to cover all the material, which means 11. And a half study hours per week over six months. Have a solid plan in place since day 1. Ideally, start with the topics you find the hardest or unfamiliar to you. You can then move on to the relatively more uncomplicated material.
Having a plan means sticking to it each day. Set a certain number of dedicated hours aside each day, either in the morning or at night. Whatever time suits you the most – the most distraction-free time, is the ideal time space for you to focus. Additionally, join study groups. An interactive study is a highly effective way to prepare for CFA. Your fellows can help you cover the material you lag in, and you can do the same for them. You can also get insight from your fellows on the most important topics you might not have known.
Starting earlier means that your preparation does not keep hanging over your head and stressing you out. The quicker you cover the material you are weak in, the more relaxed and confident you will feel. Additionally, you will have time to relax in the end and move at a slower pace to revise and digest all the material.
Opt for a Prep Course
Taking a prep course means knowing what track you are going on and assessing yourself at each step. It means matching essential deadlines, managing your time, and learning specific topics more effectively.
It provides updated access to the weight assigned to each topic and concept. Prep course is a self-paced program that helps you be smart about what to study, how much to study, and what to leave for the end. It helps you save time and resources and allocate your efforts in the right direction.
Focus more on the Concept than the Math and Practice
Sure, there is a lot of math involved in CFA. It will be frustrating to you only if you overwhelm yourself with it. The trick is to understand the concept behind the math. Once the concept is clear in your mind, you can easily tackle any mathematical problems.
The CFA Level I exam is more conceptual. The prep course helps you focus more on the relevant formulas with common-sense applications, making it easier for you to decipher them.
Another trick is to practice. Regarding math and formulas, only practice can make you perfect. Attempt as many formula-based past paper questions as you can. Your prep course will also help provide you with the latest and updated exam prep questions. Use those to gain a better conceptual understanding and make yourself confident.
Aim for More than 70% Score
As the standard passing score for CFA is higher than 70% for each level, aim for a higher score. It is what makes CFA so challenging. Therefore, to be safe, you must set a target to pass your mock exams and practice tests with a 75%-80% score.
However, do not get frustrated if you fail on the first attempt. Most of the candidates do not pass on their first practice test. You must start preparing from day one and keep leveling up each week.
With each attempt, reassess yourself. It will help you examine where you lag. Work on your one weak area each week and practice on it.
If you are consistent with this practice for six months, you will likely score higher than 70% in your exam.
You’ll be able to clear your CFA exams with the help of highly accredited professional certifications and tips from industry experts. These include previous CFA students, mentors, professors, and examiners.
Following tips like focusing on the most-tested material, having a solid study plan, opting for a prep course, focusing on the concept, and aiming for a higher than 70% score will help you clear your CFA exam with a passing grade.
However, keep in mind that you are not alone in this. Take advantage of course review, group study sessions, and mentors for an interactive learning experience. Do not beat yourself up for not clearing in the first attempt. It will help you understand what you need to focus on more. Do that and be consistent, to feel more confident about your exam preparation.