To advance a career in the financial industry, the investment world or the banking industry, one should consider becoming a Chartered Financial Analyst (CFA). Carrying this title gives employers credibility and conveys not only financial expertise, but also persistence and a willingness to work hard.
Make no mistake, the CFA program is no small feat. Be prepared for a long and difficult testing process. the CFA Institute The program requires applicants to demonstrate understanding knowledge, analytical skills, and persistence.
To be in the best position before the test, one must enroll in a reputable preparation program that includes mock testing. This type of test allows you to get used to the structure of the test and the difficulty of the time limits, and to test understanding of the information.
The process to become a CFA involves passing three different exams. Because each exam is unique, you have to prepare for each level differently. The following information provides a description of what each exam involves and how best to prepare for it.
The first test consists of 180 multiple choice questions. The problems are divided into two sessions of 135 minutes each. A break between sessions is optional.
The test requires a thorough understanding of the different asset classes, investments tools, ethical standards and portfolio management methods. Specifically, we can expect to see questions on:
- Quantitative methods
- Financial report
- Financial analysis
- Ethical standards
- business Finance
- Equity investments
- Portfolio Management
When you are ready for test day, be sure to wear comfortable clothes, bring a calculator, and answer all questions. There is no penalty for incorrect answers.
After you pass the first level test, start preparing for the level 2 test. Start by reviewing the results of the level 1 tests to correct any weak spots.
The level 2 test presents different scenarios, each accompanied by multiple choice questions. Again, the exam is divided into two equal sessions, and a break is allowed between the two sessions.
Scenarios are basically mini case studies that tackle real world issues. The expectation is to solve each scenario using the information taught. In terms of content, this exam covers 10 topics that fall into the following categories:
- Portfolio management and wealth planning
- Investment tools
- Professional and ethical standards
- Asset classes
Practice is very useful with the Level 2 test. The more scenarios you read and attempt to analyze, the more familiar the test format will become. One method that can help during the test is to take a look at the questions before reading the detailed scenario so that you know what to look for.
After passing the first two levels of the CFA test, there is only one level left to complete. Here is some useful information about how to pass level 3 of the CFA.
First, the structure of this exam is different. Be prepared for essay questions in addition to the usual multiple choice problems. Overall, the focus of this particular review is to determine their understanding of portfolio and wealth management. The analysis of complex situations will be given in the hope of being able to draw informed conclusions. The test is divided into two sections:
- The morning session offers essay questions with several parts that present scenarios to think about and solve.
- The afternoon session features 10 different case statements with multiple choice questions to answer.
If you work in finance, banking, or investing, becoming a CFA can be a game-changer. By taking a reputable preparation course and practicing practice exams, you can go through all three levels and earn your CFA certification in no time.