CFA® Program Course offered by AnalystPrep

The CFA Program encompasses three very challenging levels (levels I, II, and III). A charter issued by the CFA Institute® signifies that a candidate has successfully attempted and passed all three levels. To maintain their status as active charter holders, members have to part with an annual payment of USD 275; failure to which a member becomes a former active charter holder.

A candidate is allowed to register for the subsequent level only upon attempting and passing the primary level, i.e., a candidate can only register for level II upon sitting and passing level I and for level III upon sitting and passing level II. To register, among many other prerequisites discussed in an earlier article, a candidate will have to part with a USD 450 one-time enrollment fee plus an additional USD 700 registration fee for each level for normal registration and USD 1000 for standard registration.

To pass your level I exam, have a look at the CFA Level I online course offered by AnalystPrep: https://analystprep.com/shop/cfa-level-1-learn-practice-package/. This course includes video lessons, study notes, over 3000 practice questions, mock exams, a formula sheet, and much more.

CFA Program Topics

As much as level III has fewer topics, all three levels revolve around the ten-level one topic. Some topics, for example, Ethical and Professional Standards, are tested in all three levels. Therefore, as a candidate, it is advisable to ensure that you read, understand, and internalize such topics since the concepts taught in the next level will be built up from the concepts tested in the precedent level.

FRM Part I & Part II Complete Course

Time to Completion of the CFA Program

The average time taken by CFA charterholders to complete the CFA Program is 2-4 years. Two years means a candidate takes no breaks between the different CFA Program levels and who passes all exam levels at his/her first attempt. A candidate who fails to pass his or her exams in his or her first attempts can take at least four years to complete the program. This also goes for one who passes the exams on the first attempt but takes breaks between the CFA Program levels.

As much as it can be devastating to fail your CFA exams, it is okay not to pass it on your first attempt. Passing it on the first attempt does not necessarily guarantee that an individual will be a better analyst. The Institute prohibits candidates from declaring that they are better analysts simply because they passed all their exams on their first attempts.

It is also important to note that the Institute does not penalize anyone for taking breaks between the levels. Some candidates take breaks to pursue their Master’s or Ph.D., some to pursue other certifications, for example, the FRM certification.

CFA Exam Dates

Starting in 2021, exam dates are as shown in the table below.

Level I can be attempted four times in a year, whereas levels II and III can be attempted twice in a year. The Institute still maintains that candidates should have a window of at least six months between their exam dates. The window ensures that candidates satisfy the Institute’s condition of studying for at least 300 hours before sitting any exam. For example, a candidate can attempt the level II exam in August after passing the level I exam in February is August.

Summary of the Level I Topics

As seen above, level 1 of the CFA exam forms the foundation of the CFA Program. Concepts tested in levels II and III built upon the concepts tested in level I. Therefore, it is important to have a summarized idea of the concepts covered in level I.

1. Ethics and Professional Standards – This is one of the most important topics in the CFA Program curriculum. It is tested in all three levels and because it can either make a candidate at the borderline to pass or fail. It equips a candidate with knowledge of ethically acceptable behavior in the industry.
2. Quantitative Methods – This is a mathematical topic that introduces candidates to the time value of money, probability and statistics, sampling and estimation, performance testing, and regression analysis.
3. Economics – This introduces a candidate to both macro and microeconomics. Candidates will be needed to interpret graphs explaining various phenomena and make calculations regarding exchange rates, among other things.
4. Financial Reporting and Analysis – This is the longest topic in the level I exam. It introduces a candidate to financial regulations, financial statements analysis, income taxes, inventory valuation, and long-term assets.
5. Corporate Finance – This examines agency relationships, cost of capital, capital budgeting, and working capital management.
6. Equities – This teaches a candidate about various markets and how to value and analyze equity securities, mostly stocks.
7. Fixed Income – As the name suggests, this topic revolves around fixed income markets, mostly bonds, and the valuation of various fixed income securities.
8. Derivatives – This introduces the candidate to the various types, uses, and characteristics of derivative instruments, namely swaps, options, forwards, and futures.
9. Alternative Investments – This topic teaches non-traditional investments, such as commodities, hedge funds, and real estate investing.
10. Portfolio Management – This is one of the topics with a lower topic weight in level I. However, it is tested throughout the CFA Program curriculum, and the topic weighting increases in levels II and III. It should, therefore, not be ignored. It equips a candidate with the basic knowledge in portfolio management that will then be used in Levels 2 and 3. It introduces concepts like the Capital Asset Pricing Model.

Final Word

As stated on the CFA Insitute website, the CFA designation is one of the highest distinctions in the investment management profession. To start studying for the exam right away, consider subscribing to the CFA Level I packages offered by AnalystPrep here: https://analystprep.com/shop/cfa-level-1-learn-practice-package/.