[ CFA Exam ]
Hi Dave,
It feels rather strange to have so much free time on my hands now. The test has come and gone, and I understand that the results will come out in about three months. Until then, I will hold a guardedly optimistic stance on the results.
The test was broken into two halves: a morning session that was from roughly 9:00 in the morning to 12:00 noon, and an afternoon session that went from about 1:30 to 4:30. Each test was 120 questions, and covered a whole range of topics, a little bit of each randomly spread about the test in clusters:
1. Ethical & Professional Standards
2. Economics: Micro, Macro, International
3. Quantitative Analysis
4. Financial Statement Analysis & Corporate Finance
5. Global Markets & Instruments
6. Asset Valuation
7. Portfolio Management
It was my impression that the test progressively became more difficult. That is, the afternoon session was a bit more difficult than the morning session. The nuances you were supposed to be able to distinguish seemed to get even more subtle. Whereas in the first test I finished with about 35 minutes to spare, I found myself with only a 15 minute cushion at the end of the second test for reviewing my work. From the 240 questions, I found myself guessing on about 3 questions I had absolutely no clue about.
The passing score is structured such that 70% of the top 1% of all scores is used as the hurdle. So for example, if the top 1% of all the candidates score an average of 95%, the hurdle point would be 67%. As of the most recent figures, the pass rate has steadily declined from mid-80% in the 1960's to a recent 55% as of 1997, while the participation rate continues to expand at an exponential rate. In 1997, 30,642 candidates took the exam, and from what I hear of this year's test, about 59,000 took it this year.
I have been told that the decline could be attributed to a lot more people trying to take the test who essentialy don't belong there: people from all walks of the financial world (or otherwise) who are more interested in the designation rather then the knowledge attained from the program. In other words, these are the people who want the title but don't usually put in the required time, effort, and sacrifices to make the goal a reality.
For those who go through the curriculum, the work load is enough to be considered equivalent to a full year of college courses. Imagine that at the beginning of the year, you are given 9 textbooks, and by June, you will take a final exam, pass/fail, to test you on everything you've learned.
Some rocket scientists I've come across started their studies in March, and I've come across also one individual a while ago who didn't want to buy the required texts at all, but desired only to buy the cram-course notes that are regularly published for the CFA exam. It's not exactly the kind of CFA I would be flattered with.
Back to the exam:
There were a couple hundred people at the hotel ballroom where the Level One and Level Two tests were held; about two-thirds were Level One candidates, and the rest were Level Two candidates. The Level Three exams were administered at the above floor, and looked considerably smaller--my guess is at most 30 people for that one, but I wouldn't be able to confirm that.
Overall, I feel satisfied with my studies. The supplementary material I used (practice exam disks, notes) were very helpful. I do have a grudge however about the poor quality control of the Allen Resources test bank disk. There are some really bonehead answers there, and I sometimes wonder what these people were on when they put the software together. I estimate the error rate was about 3%, but each one felt like one too many in my opinion.
While I wait for the results for the next three months, I pleasantly find myself with freedom of time on my hands. With that time of course, I will be looking to catch up on lost time with loved ones, and reading the numerous books that have become backlogged.
Regards,
Rainier |
