Answers to questions about the CFA exam you may never have thought to ask

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In less than two months, tens of thousands of current and prospective investment management professionals will sit down to take one of three levels of the CFA exam. With that in mind, the CFA Institute’s head of exam development, Chris Wiese, just took part in a Reddit AMA (ask me anything) where he was peppered with questions from soon-to-be test-takers about the CFA exam in general and some that are specific to one of the three levels.

The moderator of the 30,000-person r/CFA thread gave us permission to repost a few of the inquires and answers. The below Q&As were those we found most interesting, particularly his responses to questions about grading the ethics portion of the CFA exam, the institute’s long-term hopes surrounding membership (unlikely to happen!), and Wiese's advice on taking Level I and Level II in back-to-back testing windows.

Q: Is there a section that you have to get a certain score on otherwise you automatically do not pass? (e.g. you do great in everything but get below 50 in ethics, so you fail the whole test.)

A: No. It's generally only your overall score that determines pass vs. fail. The one exception is that for those people right on the pass/fail line, the Board generally elects to consider performance in ethics as the determining factor.

Q: Is there a passing score (or average passing score) for the Level I exam for this June?

A: The passing score is not determined in advance. After each administration we convene a group of subject matter experts to help us set a fair passing score for that administration.

Q: If I were to pass Level I in December (and get results in February), would you suggest starting studies for Level II to take in June or would you wait the whole year until June 2021?

A: I'd personally suggest waiting the extra year unless you feel particularly confident and you have plenty of time to study each week.

Q: Is the Level I a.m. versus p.m. divided into sections, like a.m. is ethics, econ etc., or are all topics covered in both morning and afternoon?

A: On Level I, both the a.m. and the p.m. sessions touch on all 10 topic areas.

Q: Many exam takers have said that the first level is intentionally harder than the rest to weed out those who don't belong in the CFA. Is it true or just a myth?

A: Myth. We do not purposefully make Level I harder. While the pass rates for Levels II and III tend to be higher, you have to remember there is selection bias there since only successful Level I candidates move on. Also, I think a lot of people come into Level I that aren't as serious or motivated.

Q: On Level III, is it possible to get a question right by giving an explanation that is not necessarily in the guideline answer but nonetheless is right/justified? Or are you expected to rigorously stick to the guideline answers with no exceptions?

A: The graders come up with a rubric that attempts to account for a variety of possible correct answers. If we come across an answer that we had not previously considered, then several subject matter experts confer and decide whether or not to award credit. It is conceivable if a panel of subject matter experts at the grading center agree with you. But my advice would be to try and stick with responses that are in the curriculum.

Q: Are the mock tests provided by CFAI prepared by the same people who develop the actual exam?

A: No. They are developed by an entirely separate group of people. Separate groups help us ensure we don't inadvertently signal anything about the live exam on the mock exam. And, to be honest, they are also a separate group because they operate on a different timeline. But they do operate using similar methods and they strive to be reasonably similar to the live exam.

Q: What should I be scoring on the practice exams and practice questions to be comfortable going into the level I exam?

A: The practice exams are not meant to be exact examples of what you will see on the exam. They are best used as an indicator of where you might need to focus your study time. And they're helpful for demonstrating some of the different ways a concept might be tested. But they are ultimately developed independently of the actual exam, so the difficulty level may vary a bit even though they use similar development processes. That said—if you’re scoring 70%-plus on the practice exams then I think you can feel reasonably confident going into exam day.

Q: What are the overall goals that you can share about membership over the next several years?

A: I think we would love for the industry to see us as a professional body. From that perspective, we would be thrilled if earning the CFA charter were seen by the industry as necessary for entry into the profession.

Note: Some questions and answers were modified slightly for spelling, grammar and brevity purposes.

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