CFA Level 1 Exam

To become a Chartered Financial Analyst and hold a CFA charter, one must complete a self-study program of graduate financial education designed by the CFA Institute. There are three levels of examination one must pass sequentially during the course of this program. Here, we will focus on Level 1 of the CFA Exam.

Preparing for the CFA Level 1 Exam

The CFA Institute notes that most candidates spend an average of 300 hours preparing for examinations at each level of the program. Successful completion of the appropriate portion of the CFA Program will prepare students to take the CFA Level 1 Exam. The curriculum is organized into 18 self-study sessions and will include sample exam questions. Two sample exams are made available online by the CFA Institute about twelve weeks prior to the CFA Level 1 Exam.

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Prior to taking the Level 1 Exam, candidates are expected to be able to perform the skills outlined in the learning outcome statements found in the curriculum. This may require memorization of certain formulas and calculator features such as square roots, present and future values, exponents, and annuity payments.
Topics that will be covered on the CFA Level 1 Exam include:

  • Ethical and professional standards
  • Investment tools, including (but not limited to):
    • Corporate finance
    • Economics
    • Financial reporting and analysis
    • Quantitative methods
  • Asset classes, including (but not limited to):
    • Alternative investments
    • Derivatives
    • Equity investments
    • Fixed income
  • Portfolio Management and Wealth Planning

Format of the CFA Level 1 Exam

The CFA Level 1 Exam consists of 240 multiple-choice questions and is divided into two sessions, with 120 questions asked in the three-hour morning session and 120 in the three-hour afternoon session. Three unique choices will be offered as answers, and test takers must choose the most appropriate answer to the question. Words such as except, true , false, all of the above or none of the above are not used in these multiple choice questions. Because all answers are weighted equally, candidates are not penalized for guessing.

Examination Fees and Deadlines

The CFA Institute sets examination and curriculum fees and deadlines which may change annually. Usually, three options are available for paying for the curriculum: purchasing the eBook only, purchasing the print format only, or purchasing both. Curriculum and examination pricing details may be found at the CFA Institute website. Deadlines for purchasing the curriculum usually fall nine months, four months and three months prior to the next examination date (December or June).

Where to Take the CFA Level 1 Exam

The CFA Level 1 Exam is usually administered on the first Saturday in December and June. Locations around the world are CFA Level 1 Exam testing centers. A listing of all current testing centers may be found on the CFA Institute’s directory.

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Grading and Examination Results

Level 1 Examination results are available online within 60 days of the exam date. Individual results will be mailed to each exam candidate, with topic area results tabulated. The minimum passing score is set each year by the CFA Institute, and varies from one year to the next. The CFA Institute reports that 38 percent of test takers passed the June 2012 administration of the Level 1 Exam. Historically, the pass rate for this exam usually falls between 37 and 42 percent.