Top 7 CFA level 1 preparation tips

Preparing for the CFA level 1 exam? Read my top 7 exam tips!

 

1.       Know your calculator inside out!

The level 1 exam is characterised by extreme time constraints (90 seconds per question!).

Lots of buttons to become familiar with!

Although the CFA Institute promotes market competition, this isn’t reflected in the choice of calculator as you are only allowed to use 2 calculators: both models are not the most practical ones (and aren’t cheap either!) and it took me about 1.5-2 months to become fully comfortable with them. Hence, start in advance, do lots of calculation exercises so you ace the easy calcs questions and put aside time for the more challenging financial analysis questions.

2.       Write your answers and calculations on the questions sheet

CFA provides you with one questions booklet and one answers booklet and tells you at the start of the exam that you are not allowed to write any intermediate results or notes on the answer sheet. What they are less clear about is whether you are allowed to write on the questions sheets! Hence, use that opportunity: write down calculations, cross out answers that are clearly incorrect, and encircle the correct answers so that you can easily check your work once finished.

3.       Ensure you can track exam progress by doing lots of mock exams

Speed is a key aspect in the level 1 exam, therefore you need to ensure you know if you are still on track during the exam or need to speed up: i.e. you need to have some signposts along the way. Do lots, and lots of mock exams (I did around 20) so you get a feeling how much time each topic requires: most likely ethics, economics and quantitative methods will take the least time, and financial analysis will be the most time consuming.

4.       Have spare materials at hand and visit the exam location

The CFA 1 exam is twice a year, rather pricey, and consists of 2 gruelling sessions of 3 hours each: I haven’t come across anyone who wasn’t stressed before the exam or extremely tired after! Avoid any unnecessary drama where you can by having a spare calculator, writing materials, and erasers. Also, visit the exam site a couple of weeks to get a feeling about the travelling time and where exactly to go, so you can focus all you energy on what is important that day: your exam!

5.       Leave enough time to check your answers

I have been surprised several times by my own stupidity during a CFA exam! Although I circled the correct answer on the question sheet, I ticked the wrong answer on the answer sheet! For some reason, the level of stress and time pressure apparently lead to odd situations. Hence, allow yourself at least 10 minutes in the end to compare your encircled answers on the question sheet with the ticked answers on the answer sheet.

6.       Consume quality foods during the day

The CFA exam is a highly intense 2 times 3 hours test which requires a high constant energy level. Therefore, ensure you consume good food before the exam and during

Ideal prep food!

lunchtime: fruit, and muesli bars are ideal prep food.

Also, be aware that although CFA does not allow you to consume food during the exam, you are allowed to consume small sugar bars like dextro energy. I found these a great way of staying concentrated for the full 3 hours (and know people having similar experiences) so test them out when you are practicing mock exams and they might also help you in staying focused for the full ride.

7.       Don’t cheat – ever!

Unlike other exams or organisations, the CFA institute is rather strict (or ruthless depending on your interpretation!) when it comes to exam fraud. The figures speak from themselves: every year between 80 and 400 people are caught cheating showing that CFA institute monitors its candidates rigorously. Not only does this imply that your result won’t count, but also that you may not be able to participate in any future exams for a couple of years. Last, and not least, your name will be published in the CFA journal: probably the worst publicity you can wish for current and future employers!

Therefore, don’t cheat, don’t even think about it! Failing an exam is annoying, however the consequences for being caught are such that I sometimes wonder why people even consider it.

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And never forget, the number of people scoring more than 70% for each topic is extremely rare: you are not supposed to know everything, and when you are having a hard time during the exam, others will probably too. As long as your score is good compared to the rest of the pack, you should be OK for the CFA 1 exam.

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Are you preparing for the CFA level 1 exam? Have you already done the exam and some tips as well? Please share your insights!

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About Servaas Houben

I am a Dutch actuary and worked in the Netherlands for the first 4 years of my career. Thereafter, I worked for 2 years in Dublin. Currently I am working in London.
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28 Responses to Top 7 CFA level 1 preparation tips

  1. Natalie Liao says:

    I am preparing the CFA level 1 exam for this Dec, 2012. I am thinking about buying online preparation classes from Schweser. Do you have any opinion about it? Does this company provide good study materials? Thank you for your kindly reply.
    Regards,
    Natalie Liao

    • I found the Schweser materials really good: especially the exam database and the 2 exam books they provide you, will give you a good idea what to expect for the exam day.
      For each of the levels I used the most basic Schweser option which I found sufficient as it summarises the CFA materials, provides lots of exercises, and many exams.

      The CFA is quite a “lonely” exam as you prepare individually and do the exam by yourself. Hence I would skip the more expensive options, like classes and tutorials and instead would spend this time looking for alternative sources of knowledge to improve my understanding (mainly internet): surprisingly I found Wikipedia a very good source as it gives a perspective from a non-financial point of view and let’s you understand better why certain investment products were created and who is interested buying and selling them and why.

      Hope this helps: please don’t hesitate to contact me in the future or connect with me via LinkedIn! Good luck with the exam prep, it is tough but worth it!

  2. Louise Furche says:

    thank you for the tips!

  3. VJ says:

    Hi Servas,
    I greatly appreciate you taking time out to write these important things about CFA-1 preparation.

    I have enrolled for CFA-1, Dec-2012. I thought reading through the CFA curriculum is the best option, but it looks very voluminous (Please correct me if I am wrong?). In your opinion is it better if I study from Schweiser instead of CFA curriculum? Or do I study from Scheweser in addition to what I read from CFA curriculum?

    I just started studying July 2nd 2012. Do you think I have enough time to complete CFA-1 until Dec 2012. I am currently not working and hence do have lot of time on hand to prepare for the exam. How long did you spend on practise questions after studying the curriculum?

    Many thanks
    VJ

    • Hi,

      4 months preparation time is sufficient so you should be fine. I would start from the schweser notes and when you have time first do the exercises in the CFA book and optionally read some of materials.

      Servaas

  4. KB says:

    Hi Servaas,
    I am confused whether I should enroll for December’12 level one exam or not. I have following issues
    a) I am working five days a week, keeping the time spent in office and commuting, the maximum time I will be able to devote in a week vary from 18-20 hours. Are these many hours of study per week sufficient to clear level one?
    b) I have always been an above average student, no such remarkable achievement in studies. Apprehensive of the difficulty level of exam.
    Do you think the above two things can be coped with and I should go ahead and write CFA in December’12

    • Hi KB,

      Yes that should be sufficient preparation time for the exam: I also studied in the weekends but ensure that you push yourself and once starting really make those 6-7 hours per day in the weekend. Just make sure that you can take a couple of days off before the exam (preferably a week) so you can get fully focused.

      Servaas

  5. varshit says:

    Hey !
    Thanks for the info you gave . I have been wondering how many question on an average should i be looking to get correct if i want to clear Level 1 ?

    • Hi,

      I think the best combination of preparation is the following combination:
      1. do the exercises in the CFA book and the additional books (like Schweser) twice
      2. gather around 12 full mock exams and practice these twice: the first time will show you where there are gaps in your knowledge and what parts of the books you should re-visit
      3. when you have the Schweser Q-bank, do the amount of questions depending on the weight of the topic: i.e. economics has a lower weight than accountancy so practice more accountancy questions. As these questions are rather small, try to do around 1000 in total at your first revision, and once done you can always do a second round of Q-bank questions. Also, when going through the answers, read through the sections that the Q-bank refers to as it will increase your understanding

  6. Juan José says:

    Hello In many sites they offer MOCK exams, where do you think are the best to buy?
    Or as you answered to Natalie Liao, buy the Schweser USD600 preparation study pack?
    Thank you Serveass for your answer.

    • The Schweser Qbank is very good for practice, as you won’t get through all questions (lots of them!).
      I also bought the Stella exam book for the level 3 exam which was also quite good.

  7. afsar ahamed says:

    hai mr.servaas,
    i registere myself for june 2013 cfa level 1 exam.i need some tips regarding time management.currently i work in oman.being a finance officer of 4 companies and having work hours of 11 a day and a day (friday) off,i bamboozled about time management.i prepared myself a study chart,but if i could get something more fruitful from you it would be great..
    I got the books,have approximate 7 months of time for preparation..
    Ur suggestions please..!

    • Hi,

      7 months should be sufficient: you seem very busy, so starting in time seems a good idea. The CFA books and schweser question base will provide you with enough preparation material. In the coming 3 months, try to get through all materials so you have around 4 months of exam preparation and your second revision of the materials.

      Servaas

  8. Rameez Ahmed Siddiqui says:

    Hello There, i am ACCA qualified, now thinking about taking CFA level-1 Exam, and currently working with international Audit firm, having little review of CFA-L1 material is comparatively easy but there is lot material to read griping that won’t be a easy task for a working person in 6 Months time. But actually my relevant Questions are ;
    1. Should i start studying all topics i.e Day-1 Code of Ethics, Day-2 Financial Statement Analysis & so on (mixing up), or completing one area then move to other?
    2. Someone suggested me, that rely on Schwser Notes & QBank and practicing Curriculum Question only. is it okay not to read Curriculum?
    3. I will be studying myself won’t take any class from Tutor because i am quite familiar with these topics from ACCA background. but the question rest is that Schwser Question Qbank and Curriculum Question are really standard of exam, or are they little tricky and hard in comparison with the exam standard?

    • Hi,

      Good questions! Hereby the answers to them:
      1. yes you can finish the items in the normal order. Just ensure that you get familiar with the calculator as soon as possible as it will take a while before you are fully comfortable with it. Doing the mathematics or statistics relatively early would be good
      2. yes schweser should be fine for level 1. The Qbank is great, so print lots of questions and find out where there are still areas you can improve upon
      3. qbank and curriculum questions are sufficient. Just ensure you also do some “real” exams (I believe both Schweser and CFA provide these as standard) so you get a feel how much every item will take you.

  9. deep says:

    Hey,
    I am from an engineering background and have very little knowledge about CFA topics. I plan to give CFA in DEC 13. What should be my study time table. I am also working so how much time would i dedicate for each topic and how should I proceed?

    • Hi,

      Your engineering background will provide you with the sufficient maths background which will help a lot in levels 1 and 2. I would suggest starting 3-4 months before the exam, and trying to take 3-5 days off before the exam day. When you spend around 16 hours per week over 2-3 months, and then more time just before the exam.

  10. Max says:

    Hello,
    I am from a non-finance background. And I plan to appear in Dec ’13 for Level 1 exam. I literally don’t have even an iota of knowledge about finance. And if I would prepare, then I won’t be doing the job, so I will have full time for the preparation. So what’s your advice? Shall I choose to do CFA or should I take up a job?
    And from where can i learn the basics of Finance?
    Thank You.

    • Good question! When possible I think you should definitely go for a job as work experience is very valuable. Why don’t you combine the both of them and see if it works out for you?

      Wikipedia is actually a good way to get up to speed with finance. Academic books are usually quite specific so the combination of internet + CFA level 1 materials will give you a good basis.

  11. Zee24 says:

    Hello
    I studied Business Studies at university however have limited experience in the finance industry and am doing CFA distant learning plus package and am registered with Quartic training. I am trying to familiarise myself with the calculator by doing the calculator tutorial however am finding it quite challenging as formulas I do not know of are being mentioned as well as everything being taught to me at such a fast pace. I mentioned this to Quartic training and they advised I purchase the maths tutorial, do you think this would be a good idea?. Also do you know of anything else that will help me when revising this course as a whole to gain a better understanding?
    Look forward to hearing back from you
    Thank you

    • Hello,

      Thanks for your question. I agree that the calculator is quite a challenge and it takes quite a while before you feel comfortable with it. The only thing I can advice is doing lot’s of exercises and after 1-2 months you would feel much more relaxed using it. Don’t worry, all candidates struggle with this so just keep with it and after a while you will own it.

      Servaas

  12. Rony says:

    hello servaas
    i going to appear in dec2013, i dont no what should i do . even i don’t know anything in quant. from where i should start or which subject. i know one thing and that’s i want to clear L1 in first try pls help me.

    • Hello,

      The level 1 exam does not require too much quant knowledge, so I suggest you start early (maybe 4/5 months in advance) so you are aware early what topics you struggle with and need to revise.

  13. Dhruv says:

    hello,
    I am from an engineering background and do not have much knowledge about different cfa topics.I am working but I am done with quantitative methods.Which chapters should i select next and can you please give me the order of topics which I should follow.Please help me

    • Hello,

      Best is usually to start with the ethics and quantitative methods chapters. The quant is important as it will take you a couple of weeks before you fully master the calculator so you better get started with that soon. Ethics is also a good starting point as it will give you a good introduction what CFA tries to achieve. After these 2 it is merely a matter of preference as the topics in the level 1 exam are all quite separate from each other (you don’t need the economics to do well in the accountancy part).

  14. Harpreet says:

    I Wow so many CFA resources available online. I agree the CFA is a lonely exam experience. I am studying online with Professor Gordon. He actually makes me feel like I am not alone in this! My routine is to watch his recorded lesson, then do the reading for the study session and then go and do the practice questions. When I return for my next study session, I start with a review of questions from my last topic and then when I do that I move on to the next session. Feel free to email me if you want to share or need someone to vent to! Good luck…Harpreet…harpreetsign (at) yahoo.com

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