How to Prepare for CFA Exams?

What is CFA?

Chartered Financial Analyst or CFA is one of the most important exams that is held for admission to the CFA Institute. Every year, lakhs of students take the exam in order to qualify as a Chartered Financial Analyst. In this article, we are going to deal with some tips and tricks to properly prepare for the CFA exam. Now, I am assuming that you already know about the CFA Exam so I am skipping that part. Let’s jump straightaway to the preparation part.

Know the Time

The first thing that one must understand that unlike other exams, this exam has 3 levels so it requires a longer commitment than other exams. According to Investopedia, the chances of passing all the three exams in a row is very slim; that is 9.8%. So, with just a 10% chance of passing the exam, how do you prepare for the exam? Let’s look at what the CFA Institute has to say about this. According to the CFA Institute, a candidate must give at least 6 months of preparation time for each level of the exam or about 250 hours total. This works out to at least 10 hours a week. Therefore, the key to crack the exam is starting early.

Make a Game Plan

Assuming you have enough time, you need to have a game plan. Divide the entire curriculum according to sections. Identify which are the sections you find the most difficult and which are the ones that are easy. Once you have done that, open up Excel and make time slots. Allot more time for the difficult parts and less time for the easy parts. But remember, do not make the schedule for the entire 6 months or you may lose motivation mid-way. Keeping yourself motivated is very important so make a plan for 1 month and follow it diligently. If you successfully follow the plan for one month, treat yourself to something good and plan out the next month. You can also plan out for each individual week if you have a shorter attention span.

Develop a Study Program

Once you have a good game plan, it is essential to develop an effective study program. There are many ways of doing so. CFA has something called Learning Outcome Statements for each chapter. Study these LOS and write them down. When you study them later, you can easily recall the formulas and concepts associated with that chapter. Another effective tool in your arsenal should be flash cards. Flash cards are great to memorize things because you can carry them anywhere. Just glance through them every day and soon you will have all the formulas and concepts at your fingertips. Also make sure you study quantitative and qualitative sections separately. Do not mix them up as this can lead to a lot of confusion. I know this may seem obvious but never move on to another section before completing the previous section.

Apart from following the above tips, there are a lot of general tips that you should keep in mind. For example, while working out problems at home, use the calculator that you will be using in the exam. This will not only save you time in the exam but will also help you get familiar with the calculator. Maintaining a healthy lifestyle is also important. You do not want to prepare for six months and fall ill on the day of the exam. Eat healthy food and do not cut on sleep. One more point to remember is that you should devise a revision plan for your study. It is no use if you keep learning new concepts and forget the previous concepts. So make it a point to revise what you have learnt through the week on the weekends.

Have Fun!

All said and done, do not forget to have fun while preparing. That is the most important part. If you do not enjoy the preparations then it will be tough for you to crack the exam. So make it a point to enjoy the preparation. Also, do not get nervous on the day of the exam. Keep a cool head and be confident of yourself.

All the best!

Featured Image: CFA Institute