What you need to do if you registered for CFA level I today

Finally, you have decided to write the CFA exam. With less than 150 days to the exam, it won’t be an easy ride. But then smooth rides don’t make skillful sailors. If you have started studying for the CFA level I exam prior to registration then it’s well and good. But I am assuming here that you have just registered for the exam and haven’t gone through any of the readings. As you have already noticed that you need to go through 18 study sessions and a total of 67 readings with each readings having on an average 7-10 LOS (learning outcome statement).

It’s a pretty long course and to retain everything that you have learned, you need to revise the entire curriculum at least once and make your own notes so that you can do a quick revision at a later stage within 1-2 days. You also need to complete your entire curriculum so that you can have enough practice to solve problems and write at least 1-2 full-length mock tests. Suppose you have 140 days left. You must finish your curriculum at least 30 days before the exam. In last 30 days, you need to do  lots of practice problems and work on your weak areas and write few mock tests as well. So we are left with only 110 days with us.

There are 10 subjects and 18 study sessions. For each study session, we can devote 5-7 days depending on its importance and length. Each study session has on an average 4 readings. You need to finish 1 reading per day so that you can finish one study session in 3-4 days and do lots of practice question on rest 2-3 days. You need to solve at least 100-150 questions per study sessions making it overall 2500 question in total one month before the exam. 150 questions and their analysis will take on an average 3 minutes per question and a total of 7-8 hours. So, 4 hours per day for practice questions and one can easily study and understand one reading in 4-5 hours. That makes it a total of 4-5 hours per day till exam date. Now for people working somewhere, it would be little difficult to manage that much time. 4-5 hours per day makes 30 hours in a week. Office goers can devote 2 hours on weekdays and 10 hours on each weekend days or 3 hours on weekdays and 7-8 hours on weekends on your own comfort. But you need to put that much effort to clear the exam comfortably.

For candidates who have no background in finance, it would be little difficult to finish each reading in 4-5 hours as they find little difficulty in understanding the concepts. But I can rest assure that the CFAI books have explained it in very good manner and an average student can easily finish that in 4-5 hours. But if you find it difficult then you need to change the strategy and might need to devote more time than 4-5 hours. Other option can be to join some good coaching classes or take help from some friends or do group studies to save your time and understand it better. However, I’m not sure of time-saving as some people just tend to waste that time rather than getting benefited from that. If you are that kind of person and self-motivator, then you need not do any of the above things and dedicate your weekend hours to self-study. You can always post your doubts on this group – http://www.facebook.com/groups/176580792480036/

Now let’s analyze exam weight and length of each subject.

Subject

Exam Weight

Readings

LOS

Weight/LOS

Ethics

15.00%

5

19

0.79%

Quantitative Methods

11.66%

8

88

0.13%

Economics

10.00%

7

78

0.13%

Financial Reporting and Analysis

20.00%

13

123

0.16%

Corporate Finance

7.08%

6

47

0.15%

Portfolio Management

7.08%

5

35

0.20%

Equity

10.00%

6

60

0.17%

Fixed Income

10.00%

6

55

0.18%

Derivatives

5.00%

3

22

0.23%

Alternative Investments

4.16%

1

7

0.59%

Total

100%

60

534

0.19%

As we can clearly see from the table above that the weight of Ethics is highest per LOS and the least for Economics. However, it might not show the correct picture for Ethics as its LOS are quite big as a comparison to other subjects. But for other subjects, the length of LOS is generally the same. We should not ignore subjects like Alternative Investments thinking that its weight is quite low as it has the highest weight/LOS after Ethics.

You have a lot of things to cover and you need to keep your head down and do what is required. As there is not much time left, you really need to make a plan and work according to that. If you have self-doubts that you might not be able to finish the course or it’s too much or these subjects are new and how would you cope with those, then you need to remember Gail Wynand.[Wynand read everything he could get his hands on. His reading branched out chaotically, in all directions. He wanted to know everything about everything. In every decision that people called crazy, he has always had the final laugh.] If you are worried that you don’t have a finance background and those guys are ahead of you then also you need not worry. You can always catch them and beat them at their own game.  Shanu Athiparambath put it superbly – “My point was that I learned something that day. “When there is a will, there is a way”, or “the virtue of tireless hard work, teeth-clenched determination, and merciless devotion”. These are lessons a child will never learn in a classroom. These are lessons which a typical teacher will never even begin to understand. It should come from within. I think these are traits which are almost impossible to manufacture. Either you have it in you or you don’t.”

If last time you studied for any exam was 3-4 years ago, then you can follow this schedule for keeping pace. Recommendations given by Gary North are also pretty good and might help you a lot.

Make a study plan and follow it religiously. You might not feel good in earlier days. But with each passing day, you will improve. Derek (in movie American History X) says it’s always good to end a paper with a quote. He says someone else has already said it best. So if you can’t top it, steal from them and go out strong. I think the same stays true for the blog post. So I picked the quote I thought you would like.

“You can choose yourself to do anything. You might not be good at it at first but if you study your failures you will get better. You will keep choosing yourself. Finally, you will choose yourself for success. And finally, you won’t need to choose yourself anymore. Things will just happen.” ~ James Altucher.

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One thought on “What you need to do if you registered for CFA level I today

  1. […] should be the chronology for topics: In level I exam, it was advisable to cover the time value and NPV-IRR concepts earlier as they make the foundation […]

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A blog of the NYU Colloquium on Market Institutions and the Leipzig Colloquium on the Market OrderEconomic Processes & the Leipzig Colloquium on the Foundations of the Market Order

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