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CFA® Level III

CFA® Level III Study Materials and Question Bank
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What Should You Expect from Level III of the CFA Exams?

As you can see, the curriculum from Level III is much different from previous levels:

Topic Exam Weight
Ethical and Professional Standards 10 – 15%
Quantitative Methods 0%
Economics 5 – 10%
Financial Reporting and Analysis 0%
Corporate Finance 0%
Equity Valuation 10 – 15%
Fixed Income 15 – 20%
Derivatives 5 – 10%
Alternative Investments 5 – 10%
Portfolio Management and Wealth Planning 35 – 40%

* The exam weights are subject to change on a year-to-year basis.

Questions Format

Half of the CFA level 3 exam will be based on item sets. Just like in level II, you will be given cases followed by six multiple choice questions.

The other half will be essay type format, which requires candidates to write down long-form answers to complex questions.

Becoming a CFA Charterholder

The CFA Level 3 exam is the last exam of CFA program conducted by the CFA Institute. Candidates who have relevant 4 years of experience, can finally put the three letters next to their name if they are successful in their Level 3 exam. Apart from having the most prestigious and valued qualification in the finance and investment industry, all these efforts put throughout the process to pass the exams ensure candidates to be a walking financial encyclopedia which grant them to become more confident in their professional lives and job interviews. Plus, in the networking events, it is nice to meet a CFA charterholder who also follows same path. Global recognition is another benefit. CFA charter is recognized by not only financial institutions globally but also by any corporation which reaches a certain size, required to allocate its sources efficiently. If randomly selected finance job postings are reviewed, it is not unusual to see that a considerable number of them require CFA or at least mention it. Demand for CFA charterholders seems to increase in the future on condition that they continue to contribute the society by adhering high ethical standards.

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General Information about the CFA Level 3 Exam

CFA Level 3 exam is only offered in June. The afternoon session, which is similar to the Level II exam, includes item set questions. Each item set has 6 multiple-choice questions and there are 10 item sets in total.

The unusual part of the Level 3 exam is the morning session, where candidates have to write answers in essay format. The essay format part consists of 8 to 12 questions and each question has two or more sub-parts.

Unlike other CFA exams, the curriculum for level III focuses mainly on portfolio management and wealth planning. Topics such as Quantitative Methods, Economics, Corporate Finance, Financial Reporting and Analysis have been removed from the curriculum. Ethics, Alternative Investments, Derivatives, Equity Investments, and Fixed Income topics mostly preserve the weightings they were assigned in previous exams. Meanwhile, Portfolio Management and Wealth Planning topics weightings now comprise 45%-55% of the Level 3 exam.

Answering Essay Format Questions

Knowing how to answer essay type questions is one of the most noteworthy criteria for success in the Level III exam. Rule number one is not answering these questions in essay format. Candidates waste their time if they try to answer these questions by using long sentences and paying too much attention to grammatical choices and vocabulary. Rather, they should give concise answers focusing on what CFA Institute want to assess. It is important to keep answers understandable but, as CFA Exams do not assess the ability of candidates to master English spelling, candidates should not spend too much time on word choices.

Exam success is directly connected with improving essay performance before walking into the exam hall and, for evaluating essay questions, is not as easy as for multiple choice questions. Self-grading comes into play in here. To do self-grading correctly, candidates must be objective at first. Only if they do self-grading properly can candidates discover their gaps in knowledge and develop an innate knowledge which is essential to give structured responses.

Partial credit is another point to be considered. Candidates get used to multiple choice questions which are evaluated based on marked answers. However, for essay format questions, they should show all their calculations step by step to get partial credit rather than only writing the results of the calculations. Also, it is beneficial for candidates to write their best guesses if they are not sure what the answers are. Because it is harder to make guesses for essay questions than for multiple-choice questions, candidates should still try their best guess without wasting too much time.

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CFA Level 3 Exam Results

Besides its disparate topic weightings and newly introduced question format, another variation of Level 3 exam is the date on which results are issued. Test takers receive their results 90 days after the exam date, whereas Level 1 and Level 2 exam results are issued after 60 days. The reason for the 30-days delay is the essay format questions which require more time for grading.

Analyzing pass rates is also a hot topic among candidates. The level III exam pass rates – above 50% for the past few years – are the highest among all three CFA exams. One reason for that would be that level 3 candidates are the ones who successfully passed the first two exams. As such, they have already mastered the necessary skills to pass CFA exams.

CFA Level 3 Question Banks

Just like for the first two CFA exams, question banks provided by exam preparation platforms are crucial for success. CFA Level 3 question banks are best for item sets, which is still 50% of the exam. With online self-study (and inexpensive!) study materials, candidates can identify their strengths and weaknesses to focus their studies on areas where they need the most work.

For essay format questions, the preparation phase is not so different from item set questions – after all, it is the same content. However, it is important for candidates to understand the new question format and be able to give structured responses through solving. For this, we recommend using the questions from the CFA Institute website, as this will be as close as possible to the actual exam.

CFA® exams

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CFA Level II
$
99
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  • 250 Item Sets
  • Two Full Mock Exams
  • 24/7 Customer Support
  • Performance Dashboard
CFA Level III
$
99
/ year
  • 250 Item Sets
  • Two Full Mock Exams
  • 24/7 Customer Support
  • Performance Dashboard

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