Most of the candidates who have just finished their CFA level I exam must be pondering over this question – what now? Should we wait for the results or should we start the preparation for level II exam right now?
Now candidates can be classified into 3 categories: (1) Candidates who are sure about their passing the exam. (2) Candidates who are borderline cases. (3) Candidates who are sure of their failure.
For 3rd category, there is no need to start preparing for level II. They should focus on going through CFA level I curriculum and see where they actually missed the train. It is very crucial for them to start preparing for L1 right now. We all have gone through this feeling before the exam that if we had 1-2 days more, we would have managed passing marks. So, what are you waiting for? You have those days now. You are at your peak. Just go through all the topics and speed up your learning. If you miss these early days, then you would lose the crucial momentum.
For 2nd category, it is very dicey and many of you would fall in this category. So, should you study the level II curriculum and wait for the results till mid of January? Well, as most of you would be aware that the difficulty level of level II is much higher than that of level I and you need to spend a lot of time in going through the concepts. Wasting next 40-50 days won’t do any good. But what if you are not able to clear the level I exam? All of your efforts for the next 40-50 days would go waste as you need to redo the level I curriculum again. Nothing could be further from the truth. Most of the curriculum is similar to the level I and is just an extension of level I. Ethics is almost same (Most of it is same across all the three levels). Economics also deals mostly with interest rate parity and exchange rates. In derivatives, there is valuation of instruments like forwards, futures, options and swaps. So, learning these will only help in understanding the L1 curriculum in a better way. Corporate finance, Equity, and Fixed Income have few new topics and other extensions (like valuation of equity securities, DCF, FCF, yield curve). The first two chapters of FRA deal with inventory and long-lived assets. Most of other things in FRA are new. Most of the readings in QM are new and deal with regression. Alternative Investments also has different readings than those of level I.
For candidates falling in the 2nd category, it is advisable that they choose few or all of these subjects (Ethics, Derivatives, Economics, Equity, Corp Fin, Fixed Income, FRA) and start reading these. You can study other subjects(AI or PM or QM) as well if you are interested. Don’t just study these readings without focus as it won’t help much. Study these with an eye for details and dig deeper into the topics to understand the concepts. Level II is mostly conceptual. It is extremely difficult to pass if the concepts are not clear. Even if the result is not favorable in mid of January, you would be learning a lot and that would make level I curriculum a cakewalk.
For the 1st category of candidates, they just need to make a study plan and start following that accordingly. You have done a lot of hard work for the level I exam. Just keep continuing that effort and level III candidate will look good on your resume when the June 2013 results will be out. You need to start right now. Few days of rest is okay. But don’t waste much time. You must try to complete at least half of the course before the announcement of level I result. Try to push yourself. Make tougher targets. When life gets too easy then it gets boring. Challenging yourself is a great way to keep life interesting. You might be feeling bored by revising level I curriculum again and again in last few weeks. Let’s plunge into the new readings. You will definitely enjoy the learning. Don’t waste your time till the announcement of result. Time is running out. Make the best use of it and try to become CFA charter holder in the least possible time.