Five Steps to Overcome Failure on CFA Level II Exam

Hello Forum,

EXECUTIVE SUMMARY:

I am giving here 5 questions to ask yourself if you fail. The idea is to frame realistic expectations for the next year.

  1. How many hours did you invested in last year’s attempt.
  2. What is the MAXIMUM number of hours you can invest in your next attempt?
  3. What is your real reading speed?
  4. Given your maximum number of hours and your reading speed – what can you accomplish, really?
  5. What I am going to change in my life in order to pass the exam?

Upon reading all this long text you’ll be able to manage your feelings if you fail Level II test this year (please note – I post it less than 24 hours BEFORE the exam results are emailed).

My purpose is to give clear guidance and advice for the people who face taking the Level II exam one more time. This ‘one more’ time could mean you are retaking it for the second or for the seventh time, the process is all the same.

I am not a psychologist by training or extra performer on the exam. On the contrary, I am stuck on Level II and now is waiting for the results. The recipes and ideas I am talking about are built on the experience of my own and other candidates’ with whom I shared the thoughts I am presenting now.

From my personal experience and from my friends’ testimonials I know that after the email of failure arrived the most important – and the most irritating – question is ‘how d’I continue?’. You are stalled and upset, even if you hide it within yourself. Your thoughts are running in an endless loop of regret and self-blame. You are looking for advice in order to eliminate the failure, i.e. to pass the next year.

Sometimes people would like to comfort you (sincerely or not), you’ll hear lots of meaningless remarks like ‘nobody ever got a perfect score’ or ‘even clever people can fail’ or something like that.

The picture is more complicated if you failed with less than Band 9 or it’s your third (and even more) unsuccessful attempt, or if you obviously gave your 200% effort. In this case all you’ll hear is some awkward mulling like ‘let it go’, or ‘move on with your life’.

We can go online to the AnalystForum and describe our effort which brought us to unsuccessful result, but we would rather not to expect to find super coaches on online candidates’ forum: at the best, people will tell you what worked for them (in their circumstances) and their advice will not necessary work for you. At worst, you’ll be washed with hidden promotion of ‘magic videos from prep provider’.

If your pain is unbearable, you would probably seek an advice outside of cfa program related public. But please don’t expect to get some real gain from them too. Professional psychologist can at best offer you ‘I do not know what is CFA Program is about, but let’s talk about your feelings about it’. The best you can get there is some form of instruction about self-lying. You perhaps could lie to yourself (forgive yourself etc) and learn to live with the failure, but nobody will not give you the real piece of advice on how to get ahead and pass the exam.

As I told you, I was there, I felt your feelings and I walked in your shoes. I know what it means when you are demoted because you did not pass. I know what it means not to be able to look at yourself in the mirror after the fail on the Nth time.

So…

Let’s get started. I tried those questions on myself and on about 20 fellow candidates who were afraid of failure after the exam this year – and they all told me that those questions I am giving you now can frame the right discussion about the exam, turned them to facts, not to feelings and helped them to form realistic expectations concerning the next year exam.

Here are the questions you need to ask yourself immediately if that failure email from CFA Institute has been arrived.

Question 1.

How many hours did you invested in last year’s attempt?

Oh, I know, you did not log your hours. And you perhaps think that it’s about quality, not quantity of study time. Sorry. In order to succeed you must think in the terms of objective information. If you do not want to know how many hours you put in, it’s like writing a report about a company without having a look into its finance statement.

At the best you have exact logs of your study time sliced by Readings and time for reading and time for practicing within each of 60 Level II Readings. If you do not have it, give the best estimate for the hours per week and multiply the result for the number of weeks.

Question 2.

What is the MAXIMUM number of hours you can invest in your next attempt?

This question is all about your personal situation. Your working schedule. Your spouse. Your boss. Your kids. Just - please! - go r-e-a-l-l-y big here. Assume the maximum time you can invest, the total maximum.

Say, you are going to start early this year? But when is that ‘yearly’? Today? Assume you start July 29 and go full gas till the exam day 2015. How much hours can you give – at the historical maximum? Can you put every day 10 hours of study? Can you Every day? Or perhaps you have a job and can study on weekends only? How many hours can you study per week?

I know, there is life around us and things can happen, but, just a minute, we are not planning anything right now. We must to know how much preparation – at best case scenario - we can afford.

And that is a question of what are you going to sacrifice in the name of the exam. Maximum number of hours means the maximum. Perhaps it means that you’ll have to take a long leave from your office. Perhaps kids will live with grandparents some time. Perhaps your spouse will have to learn to live some time without you since you work 9 days a day and hit books 5 hours after that in the community library. That is all about how much you are ready to sacrifice. No sacrifice, sorry – no pass next year.

Question 3.

What is your real reading speed?

Take a clock and read. Read for an how, say, a DCF reading (lots of formulas). And after that take another how for corporate governance reading (since there is no formulas there). Read it and study it. Take notes. Mark some material in the book. Make a flashcard. Read as you would read while studying, giving your command of English, your level of industry experience, your ability to understand the material. Make an average of the two hour sessions - average pages per hour. That’s your reading speed.

Question 4.

Given your maximum number of hours and your reading speed – what can you accomplish, really?

Say,2014 Level II Readings are 3100 pages, your real speed is 10 pages per hour, so you need 310 hours to read the material at least once. If you calculated 400 hours on Question 2, you can at your peek investment badly read the books one time and have some time for mocks left (but you could not have time for review of the material).

Question 5.

What I am going to change in my life in order to pass the exam?

After I know what I can – at maximum – accomplish, perhaps I can have a second thought about the things I am ready to sacrifice. When I decided, I can return to questions 2-4.

Implementation.

Let’s talk of two candidates, A and B (the both are damn real people).

A is 32 y.o. have a family, works in a bank on analyst position.

Question 1.How many hours did you invested in last year’s attempt.

Answer: I do not know… About 10 hours a week. And I started in January. So it’s about 5 month * 4 weeks * 10 hours = 200 hours. And I took a week off for the last week before the exam. Say, I made totally 250 hours. Or 270. Donna know.

Question 2.What is the MAXIMUM number of hours you can invest in your next attempt?

Answer: I’ll start earlier. Much earlier. Say, August. And I am going to study that way: 2 sittings of 3 hours in the weekdays and 10 hours total on weekends. 16 hours per week * 4 weeks * 7 month = 450 hours. And I gonna take two weeks off before the exam. So say 550 hours.

Question 3. What is your real reading speed?

Answer: It’s on average 7 pages per hour. If I do examples and take notes.

Question 4. Given your maximum number of hours and your reading speed – what can you accomplish, really?

Answer: I need all these 450 hours to read the readings just one time. It will be exactly like this year, when I run out of time and did not review the material in a proper way.

Question 5. What I am going to change in my life in order to pass the exam?

Answer: I do not know…

My advice to A.: Listen, you must understand that there is no place for the failure any more. Go to your boss. Tell him you are Level II Candidate on CFA Exam and you are really serious about to your pass

Tell him y you’ve been working for 3 years in that place. And during the 3 years you made for him 180 hours a month and had only 40 hours to study for the exam. Tell him that since now on you need 100 hours per month for the exam, so he’ll get from you 120 hours only. He won’t agree? Quit!! Find another job with less demands.

Make your effort, make your step, sacrifice something valuable for you for the exam. Or you can of cause do nothing. And you’ll go to the exam half-prepared and face the possibility of another fail (if you have bad luck) or you can pass (if you have good luck and the exam will cover exactly the material you reviewed in magic videos from test provider).

Candidate B is 27 y.o. single, freelance reporter on stock market issues and a saleslady in fashion outlet.

Question 1.How many hours did you invested in last year’s attempt.

Answer: About 300 hours in 5 weeks. When I decided I am going for Level II, I temporary quit my position as a salesperson and informed the blogs I’ve been working with I am about not to take new assignments for some weeks.

Question 2.What is the MAXIMUM number of hours you can invest in your next attempt?

Answer: Next year I can move in with my parents and work 4 month full time on the Exam. Given 9 hours a day I can accomplish about 1000 hours.

Question 3. What is your real reading speed?

Answer: It’s on average 9 pages per hour.

Question 4. Given your maximum number of hours and your reading speed – what can you accomplish, really?

Answer: I can review the Readings twice and have 200 hours left for mock exams, I guess it’s enough for 12 mocks and review after them.

Question 5. What I am going to change in my life in order to pass the exam?

Answer: I can take an extra job in the autumn in order to have enough savings to start even in January.

My advice: with such an attitude you can reasonably expect to pass the next year.

So that is your turn, Reader. Please answer me in replies:

  1. How many hours did you invested in last year’s attempt.
  2. What is the MAXIMUM number of hours you can invest in your next attempt?
  3. What is your real reading speed?
  4. Given your maximum number of hours and your reading speed – what can you accomplish, really?
  5. What I am going to change in my life in order to pass the exam?

If you weight in, I’ll post my own answers in the bottom.

tldr - can you summarize please

Ummmmm…No. Not reading that.

Added summary on the top

Some of the worst advice I’ve ever read.

So…if I fail, I should march into my employer’s office and inform him that I AM A LEVEL II CANDIDATE and from now on he will only get 66% as much work product from me. Yeah…I think I’ll be fired before I can quit and find a “less demanding” job. Seriously, you’re telling people to quit their demanding finance careers and take a job waiting tables so they can study full-time for the CFA? This is some ass-backward thinking.

By the way…180 hours a month is only around 45 hours a week, i.e. not that much. You’re suggesting people should only be part time employed in order to pass the exams. Part of the challenge of the exams is completing them while holding down those demanding finance jobs…after all, aren’t those jobs the goal and not just some obstacle?

Not at all!!

But my point is that there is some choice which has to be made. Candidate A has to decide what he wants more: to keep his job or to pass the exam. I wish him to pass this year, but if he fails and next year will continue the same path like in 2014 (10 hours per week), he has a proven recipe for going to the 2015 Exam underprepared.

And BEFORE Candidate A is engaged into 2015 study routine, it’s better for him to know what he could accomplish at maximum.

That could manage his expectations and help him to discuss facts, not emotions concerning the 2014 result.

That’s all.

agreed that is some pretty terrible advice

My advise is to ask yourself the 5 questions only.

If I delete that my advice to A - do you think the post will gain from it?

Its one method - I like it since it has a battle plan. Think your situation through and analyze it. Don’t agree with your suggestions, but this will help me move on and plan for next year. In any case -this kind of ground work needs to be done regardless of the level.

Agreed, I think I’ll pass on making demands after failing! Maybe just working smarter and not harder is a better idea…

Reading speed and time invested are probably relatively low predictors of L2 success.

Does anyone want to post her/his replies to the 5 questions?

It will probally take less time to go over the stuff for someone who has taken the exam before unless the previous attempt was fully unprepared.

If someone failed, the most sensible thing to do, as it seems to me, is to look into what you have done well and what you have done not so well. Are you able to improve on your weaker areas and how? Yes, you can. Tackle them and you will pass.

The common pitfall is probally you did not practice enough questions. Solving questions is more active studying. When you start to work on questions, you will find it is quite different from your reading the explanations or examples.

There are other tips in general. Studying smart is even more important than being smart for such an exam as CFA Level 2. When I have time, I will try to write something more. Even though I was over 70% in all sections, there were things I would want to do differently if I could go back.