Updated: Apr 17, 2020
First thing first, I am not trying to boast here. After noticing that there is no detailed one-to-one article on how to prepare for this exam, I decided to write one in an attempt to help fellow students get clarity on the preparation process and to let them know how easy it is to achieve above 90 percentile with a set plan in hand.
This article will include how I studied for my Level 1, the Do's & Do Not's, subject-wise study tips as well as overall observations I made solving the question paper which no one else will share (all in accordance with CFA Code of Conduct of course ;)).
The DO NOT's
The Do Not's are more important than the Do's. Students sacrifice a lot (most of it being silly) in the process of cracking the exam thinking it's absolutely necessary to just focus on studies and not have a second of leisure in-between. That is absolutely wrong. Here is a list of things you should avoid:
- Give away your phone. Seriously, don't do that. Reduce the time that you use it for but do not give it away.
- Think you'll study for 12 hours a day at the end and crack it. A lot of people have failed because of this mentality. CFA is not a 100 metre sprint but a 20 Km marathon. Study a bit regularly and you'll be good to go.
- Join a coaching class with 30 or more students in a batch. The teacher won't have the time to solve your queries and trust me while practicing questions, you'll be having a ton of them. Join a class where you can have personalized attention and someone who is always ready to help
- Join a whatsapp group of "CFA Queries and Solutions" the link of which you got from the CFA Forum page. It'll just increase your blood pressure, nothing else.
Is joining a Coaching Class necessary?
No. Absolutely not. BUT it increases the probability of you clearing the exam. 95% of the CFA concepts will be alien to you and having someone explain it in an understandable manner not only reduces the time required to learn it but also helps you remember it forever (or atleast till the exam, I guess).
My story & the DO's along with it
There are two channels of studying: Attending classes & putting time to self study.
I joined CFA Elite (LeapUp Edutech's premiere offering of CFA Coaching) in Late June/August.
Attended classes regularly. We had regular tests which I'd say I barely studied for. How can you blame me, the exam was months away. There was no chip on our shoulder to perform well then, was there?
However I paid attention to what was taught. This right here is the first DO.
Pay attention in class even if you won't study it later at home. It helps you clear concepts which no friend of yours will help you understand one month before the exam. Just pay attention. Control that dizzy sleepy head of yours while concepts are taught.
This paying attention in class but not studying plan went on for months until....
January, let's get serious
I really, really started self studying from Mid-January. That too just 2 hours a day. Now, what subject you should start with and stuff like that will be discussed later. For now, just remember your second Do. If you open a chapter, complete it thoroughly. Understand and remember all the concepts. Know all the formulas given in it. Solve all the questions at the back.
I see a lot of students using the concept of "Readings".
Reading #1 is just reading. Reading #2 is understanding concepts at the top level. Reading #3 is deep diving into the chapter. #4 is solving questions.
You'll end up spending 2x the time you'd take to complete the chapter. That's because by the time you come back to it for the next reading, you would have forgotten what you read in the previous reading. Instead do everything at once and later just come back to revise.
Also, it is okay to not go subject by subject. You can learn 2 chapters from 2 different subjects at the same time. That's fine.
Cheat the exam to beat the exam
My studying time increased to 3 hours in February. 4 in March and 6 in April to a 7 hour routine in May. I wouldn't suggest you to copy this exactly as it really depends on the person's grasping speed.
Now let me tell you the third and the most important Do. Practice as much as possible. This is the only sure shot way of getting a 90+ percentile. You might know the concepts but how CFA tests that by twisting questions is unknown to you. That's why, give a lot of mock exams and practice as many questions as possible.
Hierarchy to follow:
- First solve all back of the chapter questions once after studying the chapter
- Complete the syllabus, solve them again. Total twice. Anything above this is an add on
- Solve mock papers. Start with Book 1. Then Book 2. Then online mock exams.
Yes. SOLVE ALL MOCK EXAMS AVAILABLE TO YOU.
NOTE: What I noticed giving the exam was that roughly 110 questions out of the 120 questions were just mock exam questions that I had solved with different data. Same format. Just different data. This is a like cheating in a legal way. If you solve ALL mock papers, expect no less than 100 questions to be already known to you in the actual paper pre-hand. Solving mock papers is the single-most important thing in your study plan.
Correct way to solve Mock Exam papers?
Always solve 2 papers in a day. At the same time as the actual paper. 9 AM to 12 PM and 2 PM to 5 PM. This let's you get adjusted to the exam format and you're better equipped to deal with the stress and nervousness as it would feel just like an another mock exam on the actual day of the exam.
Once you are done with the mock exam paper, review it and mark all wrong answers in red. Next, see the solutions and write "Important" next to the wrong answers that you think you will forget the answer to if not revised again. As the D-Day comes close, first review all the wrong answers once and 2-3 days prior to the exam, review the Important marked questions again.
NOTE: Again, I can't stress this enough, 90% of the actual paper is just the mock exam with different data. I am saying this after giving the exam last year. This is not a generic article on the web which is written by someone who took the exam 10 years back. Believe me when I say: Higher the mock papers solved, higher is the probability of you getting 90+ percentile, forget just clearing the exam.
What study material do I use?
Schweser books. Nothing else. Schweser has 95% of the material that you require. Don't spend equal amount of time that you spent to learn that 95% in finding the remaining 5% somewhere else. It's not worth it. Also, a lot of classes like FinT*ee will give you their own notes but I'd say keep them as secondary revision material not primary learning material. I have went through them. Schweser is easier and more concise.
Corporate Finance: I started self studying with corporate finance.
- Easy subject if you understand the concepts. Start this as it will also set your hands on the BA 2 Plus calculator.
- Do all chapters except the first Corporate Governance chap. Leave that for the end (May) as you'll forget it if you start this early. That chapter is a "just know it and remember it" type of a chapter
Ethics: I studied ethics side by side with Corporate Finance.
- Very very important to make your own notes.
- Very important hack that no one will tell you: Once you solve 250+ online & offline questions you will realise most of them have a similar logic to apply. Only a few things will be changed in the questions. Make a list of such patterns. You'll end up with 50+ patterns which will form 70% of the actual questions asked in the exam.
Let me make it more clear by giving an example:
Pattern #1 - Acting on information given by someone not of a high post in the company is not insider trading.
I noted this down.
Later I saw a question where someone acted on information taken from the factory watchman. Another question had the building peon. I immediately knew it was a pattern question and the way to handle it.
FRA: Start FRA very early. I started it in Mid-Feb.
It's a huge huge subject and you'll have to go through everything thrice atleast to remember stuff.
- Make notes in tabular format of the differences between IFRS & US GAAP
- Make a separate sheet to refer to for all the ratios
- Do part 2 (Income statement group) first then part 3 and then part 1 & 4 as they carry less weight in the paper
- Make a separate sheet of what ratios increase and decrease due to XYZ change (As shown in chapters like Inventory, DTA DTL, etc)
I could go into very minute details for FRA as well as other subjects but that would make this article extremely long. If you want to ask for specific tips, contact me on instagram/jatan_45
Economics: I had skipped a chapter completely in this subject. However, I'll guide you through the rest of it to the best of my knowledge.
- Start with the forex (last) chapter. It's very easy.
- The first 2-3 chapters are easy as well. Quite a lot is repeated from 12th HSC Economics or is easy to understand in the first go.
- Then starts the macro chapters. I wouldn't be the best to help here as I wasn't extremely strong in them.
Quants: I am going to tell you the single most important thing you need to know to get this subject: There is a YouTube channel named "IFT". Go to that channel, watch all quants videos and you're good to go. I have never seen someone explain these concepts so nicely. Make sure to make notes out of it though for future reference. I'd go to an extent to say that it is okay if you don't pay attention in your classes during quants. IFT will teach you in half the time any class will take to teach the same with a more easy and fun manner.
Fixed Income: A lot of concepts, a lot of brain use. Either you excel at FI or you suck at it, there's no inbetween. Sorry friend, you're on your own here.
Rest of the subjects are quite easy and you'll get it if you try hard enough. Hence, no tips are required. Here's the result I got by following the above mentioned tips, be your own judge:
- Do not give up on your phone or TV time because of the exam. It is not as hard as it seems.
- Solve mock papers, clear the exam. Simple as that.
- Ethics & FRA, the sooner you start, the better.