How to pass CFA 1 with two months study, no formal financial background.

CFA Level I
#1

How to pass CFA 1 in two months with very little financial knowledge.

No accounting knowledge, no financial reporting knowledge. You know just a few things about finance here and there. Everyone tells you need 6 months. I did it in 2 months, I started April 1st (no joke haha…) and passed with 5 topics > 70%; 4 topics 50>70% and 1 below 50%.

I assume you will have full-time availability! If you have to work, forget it, IT CAN’T BE DONE in 2 months.

There are no specific directions on the order of topics and the specific timings. We are all different and unlikely to follow directions that are too specific. So I will give you an outline and you will adapt it to your needs. The idea is to study the topics more than ones, sort of to rotate them. Study A,B,C then A,B,C again then practice them then practice them again. It will eventually stick to you brain, even if it doesn’t seem to!

What you need:

Kaplan books, Kaplan Question bank (Qbank), Mark Meldrum videos. NOTHING ELSE. NO BOOKS ON ACCOUNTING! A few Googles here and there maybe, but no structured learning of accounting, it’s not necessary.

YOU WON’T BE USING THE OFFICIAL CURRICULUM; there is no time for it.

You will need to study in 3 shifts. Morning: around 4 hours, 1h30 lunch break, Afternoon: 4 hours, 1h30 dinner break, Night: around 3 hours. 7 Hours sleep every day. Not less otherwise you won’t assimilate the info! Take Neurozan brain supplements if you will. I think it helped me J

You need to study around 10-11 hours a day with one day off every week (or you can make every 6th day an off day)

VERY IMPORTANT: The off day is 100% off! No finance, CFA related stuff, it must be used to get a full disconnection from the studies. A good idea is to read a book in a park for example. You have to totally disconnect. So don’t touch the materials even for 5 minutes. When doing this you will get the feeling for the rest of the week that since you had your full rest day, you must study at 100% the other days, no excuses, no procrastination!

Your strategy:

There is no time to cover the entire curriculum, so you need to let go: Derivatives and Alternative Investments (the whole topics), hypothesis testing in Quant, Taxes in FRA. STUDY ALL THE REST!

The most important topics are: Financial reporting and Analysis (FRA) and Ethics.

The most difficult topics are (no order) FRA, Fixed Income, Derivatives.

WARNING: Ethics is a MUST! Why? Because due to time constraints and 2 topics that you are unlikely to pass (Derivatives and Alternative Investments) your score should be close to borderline and in case of borderline scores, Ethics will define you pass or not. Ethics is not common sense! Don’t mess with it! So Ethics will be your wild card. You must DESTROY Ethics. Another must-know is FRA. It’s 20% of the exam, so if you nail it you are one fifth done. Add Ethics, it’s one third. These two topics must be known at 100%

First month + 1 week is to study the theory.

Second month\last 25 days is EXCLUSIVELY to practice. Theory is done by then.

Start with Ethics (don’t leave it to the end) and FRA. First month will have the morning session exclusively dedicated to FRA.

FRA: If you have no finance and/or accounting background then this will be like another separate test you will be studying for. It’s fine! The most important part here is to understand the structure of the financial statements and how the whole thing interacts. It will come with time (at the very end)

How to take notes:

When taking notes, WRITE THE LEARNING OUTCOME (LO) you are taking notes on. It will be essential for your 2nd month when you will be practicing. You will find the information you are being tested on (via Qbank) quickly by checking the question’s LO, so you can go to your notes, find that LO in your notes, review that question and add more info. If you don’t write the LO’s on your notes, you will be lost all the time and you won’t have time to effectively review and build on information.

VERY IMPORTANT: You won’t have enough time to firmly cover all curriculum, so don’t stress when you will feel overwhelmed by the amount of info. You will be layering the info. Like a cake… Layer on layer and in the end it will be a shaky cake, but good enough to pass.

DON’T EXPECT to learn and understand all the material. If there is something you don’t understand after a few tries, then skip it!! No time to waste. Just hope it won’t come out on the exam. You are taking chances here. Remember: a difficult concept may take a full day to understand and then you may not even get tested on it (or get 1 question out of 240.)

The central point of the learning process:

When you feel like you have no time or that you aren’t learning, DON’T STRESS. The point here is to gradually elevate your shape, just like a professional athlete, so you are at you peak for the competition (the test date.) You will be at your best when the time comes. You will only feel it during the test! NOT DURING PREPARATION.

1st April onwards: Morning session: FRA 1st reading. Read the Kaplan curriculum, light note taking, go fast, some 50 pages for the morning session. Afternoon: There are theories that you should ignore Economics. Kaplan Curriculum is pretty light on economics; the information is very well compressed, so maybe you should start with that. 35-40 pages a day. Takes notes on these! When you are done with a topic, do the end-of-chapter exercises (there is just a few of them it won’t take long)

The following day BEFORE YOU START the next chapter, do some 20 random questions from the Q bank on what you studied yesterday. It will lightly refresh your memory. There is no time for more. Move on with the curriculum.

2nd week:

By the end of one week you should be done with FRA 1st reading. You shouldn’t have understood much of it. It’s fine! The idea is to just give your brain an idea of what’s up. Now you will start the second assault on FRA. Same story, morning shift is FRA-dedicated. Now watch Mark Meldrum videos. You will get the same theory from a different perspective. TAKE NOTES. You will be getting a deeper understanding of FRA.

Afternoon: Keep reading 35-40 pages a day of some other topic you choose. Move fast, try to understand everything.

Evening: FRA! Yes FRA again. Repeat what you studied in the morning via Kaplan curriculum.

3rd week. Keep as in week 2 except that now the evening session is dedicated to not-FRA non-Ethics. You have to move fast to finish the theory! (morning is still for FRA or Ethics as you will)

4th week: All day is dedicated to non FRA, non-Ethics. You are running out of time to finish the theory!

5th week. If there is still some major chunk of theory to cover then do it in the morning session. Afternoon session: Qbank. Start practicing hat you learned in the same sequence during your afternoon sessions.

Evening: FRA 3rd reading. Now grab the Kaplan curriculum and this time take detailed notes. This time you will really understand the material, trust me! Second month’s evening sessions are fully dedicated to FRA. Nothing else. Aim for some 100 Questions per day. on all topics. Daily. When you get a question wrong, go to investigate why! If you get it right, still investigate why it’s right!

How to use the Kaplan Qbank.

DON’T USE RANDOM QUESTIONS. DON’T EXCLUDE EASY QUESTIONS (as many suggest) The easy questions are the stupid points you may be losing. Simply because it’s easy, it doesn’t mean you know it or that it won’t be tested. You will solve around 2500 questions in total. Some of them more than once (The medium-hard ones)

When you select a topic on the Qbank, open all sub-sections and select some 5 learning outcomes by the order those are in the Qbank. Select all questions and answer all of them (easy, medium, hard). This will test you deep understanding of the topic! It will also add a lot of detail to your knowledge. CFA is all about details.

Extra: There are complaint about Kaplan Qbank. I found it to be great. DON’T USE OTHER QBANKS specially if you study via Kaplan books (which I highly reccomend) DON’T SAVE MONEY ON QBANK! You are investing 2 months of your life to get a very important certification. Is it worth saving 200 bucks here?.. Rethorical question.

The actual questions on the test were low/average difficulty IMO. Maybe some 20-30 really tricky ones. Qbank has way more difficult questions! End of chapter official questions are even more difficult. So do the Qbank + some end of chapter and you are fine!

EXTREMELY IMPORTANT:

The LO’s in Qbank will be in order you studied them from you Kaplan curriculum, so you will start to mentally map the knowledge. THIS IS CRUCIAL!!! You must have a mental map of all the topics and where the info lies. It will be a huge help on the test. Otherwise you will feel lost and overwhelmed by the amount of information. This technique will help you keep it “under control” This is why it’s so important to do the questions all in order by the LO’s. It will make the mapping very precise!

Remember how you took note of the LO you were taking notes on when you studied the theory in month 1? Now every time you don’t solve a question you will quickly find the LO it refers to in your notes and add info you didn’t know. The mapping will be even better.

Extra: If the LO has like 40 questions in it, then select only that one LO and hit it. Solve like 25.

So select some 5 LO’s and solve them. Then select the next few LO’s, solve them. You have to cover the topics at similar speed as in month one. (Also, try leaving the last 10 days for one last recall)

6th week: morning sessions are dedicated to Ethics exclusively. You will read the 300 page Standards Application Book (download it from CFA website) and do questions right after you finish. Don’t read in detail, there is no time. MEMORIZE WHAT EACH STANDARD REFERS TO. Basically memorize the index. You may be asked “what Standard this situation refers to?” So you have to know it!

All else as in week 5.

Week 7: morning and afternoon sessions dedicated to non-FRA, non Ethics. Evening for FRA. You should be doing a second round of questions. (repeat the medium-hard ones)

EXTRA: Register for Kaplan test simulation in your town. It’s very useful to test your knowledge and be in real exam conditions. BTW probably your performance will be quite low. It’s totally normal, don’t worry and keep doing the study plan! You knowledge is improving; you are just unaware of it yet. THIS IS THE ONLY MOCK YOU HAVE TO DO. Don’t waste more time with other mocks.

Week 8. You are done with the Qbank. Now grab the official Curriculum and start solving the end of chapter questions.

Make a plan such that you will be covering 4 topics a day, Rotate them! Do all questions except FRA. (do those too if you somehow have time, but for FRA keep with the Kaplan Qbak) WARNING: you might be shocked by the complexity and surprised by the official questions, It’s ok!!! This doesn’t mean you haven’t learned enough from Kaplan. This will simply give another perspective to what you learned and will shake up you knowledge in unexpected ways. You will discover new connections you didn’t see before. So this step is crucial.

Last days: Hit Ethics hard even if you already dominate this topic! Keep practicing the other topics (whatever you feel like weaker at)

Extra: What about Derivatives? DON’T TOUCH THEM. It’s 5% of the exam, Let it go, this topic is very complex. What about Alternative Investments? If you have some time just read though it and solve as many questions as you can. Also: since you will be guessing at least the 12 questions on derivatives you have some 15 minutes extra time for other questions. Use the extra time wisely!

Test day:

Take some 1min30sec per question, but don’t stick to this timing too much. Some questions will take 20 secs some will take 3 minutes. So no stress on timing.

When you are in doubt on a question, SELECT THE OPTION THAT FIRST CAME TO YOUR MIND!This is because your knowledge is layered, it’s there, but it’s not solid enough so you can access it when you and as you want. So the first info that comes to your head is usually your brain selecting the right answer, kinda unconsciously. This is the right option! DON’T TRY TO RATIONALIZE AND OVERTHINK. You will most likely select the wrong answer. You are not ready to think about the questions too much.

At the bottom of every “column” on your answer sheet, check if you are marking the answers in the correct order (so that you didn’t put the 50 answer in 51, 51 in 52, etc. This could be a DISASTER)

This is it.

There are no magical formulas to pass… This one will allow you to get the highest possible chance to pass with 2 months. I did it with no finance background, you can do it too!

Extra: If you have a third month, just solve all the questions again and you will pass 100% guaranteed.

#2

I appreciate the effort you put into this write-up, but something really irks me when I see statements along the lines of “This is the way to do it” or “It CAN’T be done.”

Everyone is different. Hopefully by this point in your life you know what works best for you.

For example, I’m employed full-time, have limited background in the material, started studying 3 weeks later than you did, and I also passed.

If I have one piece of advice for future test takers that I think will apply pretty much universally, it’s to ignore all of the people who tell you that the key to success is taking lots of mock exams. I’m not even sure I understand how that could possibly benefit you. Taking a mock exam and then using the results to direct your study over the final few weeks is a great way to shore up your weak spots, but just taking a bunch of mocks seems pretty useless. Take a mock, take note of what areas of the material you are weak on, and go back to study those / make some flash cards for them.

Additionally, Derivatives on level 1 are not difficult. Maybe you don’t want to spend the time necessary to ace that section, but if you are inclined to ignore it I would suggest you at least learn the basics of put and call options. The concepts for level 1 on those are very simple and not too hard to nail down, and you’ll almost definitely see some questions about them.

#3

Echo of the above:

Although AI and derivatives have low weight, they also carry some of the easiest marks in my opinion. You could spend less than an hour on learning put-call parity/covered call/protective put and you would be in a position to at least take a stab at some derivative questions. AI is much the same, a few hours and you can have a working knowledge.

#4

cj4g I’m not here to get into some argument with you, but there is NO WAY to study for 5 weeks, working with no previous experience and pass. You are clearly not being precise about your background. If you could pass CFA under these conditions the pass rate would be 95% and anyone could get it. If I had two weeks less time I wouldn’t have passed. I am being realistic about this whole thing. The believe in yourself talk has limits and I don’t want candidates to waste their time and money doing something that can’t rationally be done.

By “no experience” I mean: You don’t know what is a balance sheet, you don’t know what is WACC, that A-L=E, what a repo is, what is the equation for GDP, etc. This is what “no background” means to me.

Also when I say that “this is the way to do it”, I am telling my personal experience and how I managed to get the information into my head. Isn’t it the point of writing your personal experience? What are you even talking about? I don’t get your point here. If you don’t like what I’ve written, fine, but just be constructive about your critic.

And for God sake don’t study 5 weeks before with a job and no experience!

PS: I’ve clearly written “There are no specific directions on the order of topics and the specific timings. We are all different and unlikely to follow directions that are too specific. So I will give you an outline and you will adapt it to your needs.”

#5

You say there’s NO WAY, but you are only thinking in terms of yourself.

I put in about 200 hours of study over those 6 weeks. It was a rough go, but I did it. It helps that the commute to my job is only about 10 minutes on a bad day. I was doing 4-5 hours on weekday nights and 10-12 hours on weekend days. My study plan looked absolutely nothing like yours.

I think it’s fine to say “this is what worked for me” and share it for people to reference, but very disingenous to say “this is how to do it” or tell people there’s NO WAY to do something just because you know you couldn’t do it. You don’t know the person who is reading your post.

#6

Mate still don’t get your point lol. Anyways write your plan and share it.

#7

My plan was pretty simple.

I just watched all of the Wiley videos, all in order except for Ethics (which I did last), pausing to practice with each concept as they came up. As I worked my way through the curriculum I’d make sure to never go more than a day without re-testing myself on the sections I was already done with. The only reading I did was for the few sections that Wiley didn’t have videos, or if I needed to reference something in the readings because the lecture videos weren’t making much sense to me.

I wouldn’t recommend to anyone trying to cram it in such a short period of time, though. Even if you’re really, really smart I’d recommend giving yourself 3 months. I had many emotional swings throughout my one and a half month process, at times feeling like the material was easy to grasp and I was nailing it, and at times feeling like “there’s way too much stuff, I can’t believe I only gave myself this little time, I’m definitely not going to pass this.”

However, I would very highly recommend that no matter how much or little time you give yourself, never sacrifice the time to really nail down the concepts that you’ve covered by re-testing yourself on them. I know with Wiley they have a tremendous library of questions, and you can basically just say “give me 25 questions I’ve never seen before on [insert topic]” and you’ll get them. It’s better to have half of the content nailed down cold and never have seen the other half than it is to have seen everything once but not nailed any of it down, in my opinion. Plus, re-testing yourself on concepts you’ve already learned is less time consuming than learning new material, so you’ll be surprised how little of your planned study time it really eats up if you consistently stick with it.

#8

Why not just leave yourself more time and study properly and for purpose? Is the objective just to pass or to also learn? The material in the CFA is Gold. All three levels teach some very interesting stuff, why do you just want to cram that in for an exam? Take your time. Enjoy the material. Apply it. I never had so much fun studying for something.

#9

I also tried with around 55 days, including 2 or more days off and the curriculum because I’m broke lmao. But really, since I have (or had, thanks god) no experience, I wanted to learn everything. Passed with around 90th percentile but I would definitely recommend allocating more time to save your mental and you will remember the knowledge longer. Also recommend studying in order of the books. You can relate many things and the examples help with many expert of difficult questions. Overall it just shows that I had a horrible time management with level 1 exam

#10

Agree. The curriculums are absolutely amazing. But I can see why people with some background knowledge and uni students find it lengthy and even boring. They already know some of the concepts

#11

It is unlikely you can pass with two months studying and no experience. Most candidates come in with maybe good experience (education or work) in 3-4 areas, and then take 4-6 months with intense study, and yet maybe 50% in a good year pass.
The concepts are difficult and take time to read, drill, and repeat. And many concepts build on others, so not learning Accounting, per se, will make equity valuation impossible.
Good luck though