Frustrated with Ambiguity of Practice Questions

So I just finished my third practice test in Schweser, and I have consistently found the most frustrating part of these exams is the ambiguity and lack of consistency of the questions.

I am never frustrated with questions I flat out get wrong or don’t know.

It’s the subject matter with which I feel relatively well versed that seems to get to me!

A perfect example is the cat lady in Question 8; AM section; Scheweser Exam 3. The story goes on to describe this woman with a stable and rising level of income. She has no heirs, except for her two cats and 2 dogs. Then in here statement she says, “I am in good health and given my family’s medical history, I expect to live for another 30 years.”

Question: Characterize her likely asset allocation as to whether it should be weighted towards stocks or bonds. Justify your response. I responded, that clearly her income is more bond like which would suggest an allocation toward equities. However, with 30 years of life left that implies she could be approaching retirement in the coming years. Therefore, due the limited amount of human capital left and the upcoming retirement needs, I’d recommend a more heavy weight of bonds. Of course the answer just says: Human capital is low risk - so more heavily weighted toward equities.

Maybe this is just me venting, but I feel like some answers fail to fully address the situation.

Is anyone else having issues like this?

unrelated question - are you guys paying strict attention to the command words?

would your answer to

Formulate the return objective portion of the client’s IPS

Recommend a return objective for the client’s IPS

Describe a return objective for the client’s IPS

Discuss a possible return objective for the client’s IPS

be different in the four instances?

My observation is schweser tends to be more ambiguous than the CFAI mocks. Anytime that happens I just move on and don’t worry about it.

You’re not alone.

Amen… There are some questions from Schweser that I really don’t know what they are asking for… I look at the answer and am shocked that the answer they are providing relates to the question they asked. I am using Schweser more of practice questions/guide than Exam Setting - as I hope the real exam will be a little more clearer on what you are asked to produce.

“stable and rising level of income” implies she is not that close to retirement

Her human capital value is still high. With 30 years of life left it means if she retires soon, she will be facing longivity risk, out living her money…that’s a long time horizon unless she had a huge asset base already. They are probaly implying she will need to or can work much longer. Who wants to sit around for 30 years doing nothing? As an advisor, I would recommend she have a higher % of equity to grow the porfolio bc u got to beat inflation and cover her long life expenses. She doesn’t have to be conservative, as with bonds, as she only has to leave enough money to cover the cats and dogs at death, if they are still live…lol

This is why dealing with real people and private wealth management is part Art part Science. The Art part gets tricky. I’m always fighting CFAi on their asset allocation percentages. Very annoying.

I hated the Schweser AM practice tests. Given that the actual exams are published and known to them, I was surprised how poorly those practice tests mimiced the actual exams.

Skip them entirely. Go directly to the actual CFA tests and learned how to answer the questions properly.

OP, I feel your pain… Maybe its because i’ve had some time away from this but I think your example is a good example of the risk of ‘over-thinking’ these case studies. It sounds like the example didn’t mention anything about retirement but you inferred that given she may be approaching retirement age, she is probably about to retire and thus should consider investing in bonds. When she retires, she may want to consider bonds. But while she is working, she should concentrate on equity.

I think its really important to try to avoid being too clever. If the question doesn’t specifically identify a related issue that pops into your head (like the retirement issue in your example), don’t factor that in to your answer.

Yeah, you guys are probably right. It may have just been a case of ‘overthinking’ the problem.

Nowhere in problem did it mention that she was approaching retirement. I took the liberty of applying the typical period of a 20-25 years retirement, which suggested to me that there was only a couple years of human capital left.

That said, it’s just one example.

I’ve been averaging around 65%-70% in the AM’s and 65%-75% in the PM’s. So I know I am on the cusp, and it was just frustrating yesterday to see that 5%-10% my missed points in the AM sections have been due to silly misinterpretations.

I haven’t taken any CFAI mocks yet, but I’m glad to hear the questions are more straightforward.

Geezie, I totall agree. Schweser AM practice exams are ambiguous and in general, I find that Schweser questions are ambiguous. I just scored a nasty 50% on the GIPS part using the question bank and it’s because I just couldn’t understand the question.

I suggest doing the practice exams, then doing a “normal” past CFAI AM exam, just to feel the difference, and a bit more confidence…

I read the same question, and thought the same thing. Part of the answer says “she has a two-stage time horizon. First stage is now until retirement, and the second is during retirement.” I remember thinking, “Nowhere in the question does it mention her retirement.”

Schweser Practice Exams should really be thought of as a teaching tool, not an assessment tool. I think they’re good to do, because even if you get the question wrong, you’re forced to understand it and think about it. In my experience with “real” CFA exams, they’re quite a bit easier.

I, for one, am glad that Schweser makes their exams tougher than the real deal.

Greenman, your point about an educational tool vs. an assessment tool is a good one.

I think we’re all a little susceptible to the performance evaluation trap. We tend to inherently fixate too much on our perceived results. I think all of us tend to compare our scores to past results, stated targets and other people. You don’t need to look far for examples of this on AF (i.e. the many feeds comparing practice scores).

That said, rather than focusing on if I got it “right or wrong” relative to some author’s interpretation, what is far more important is simply that it prompted further discourse of the topic.

Following this topic—what is your guys feeling about BOSTON mock exam? are they better than Kaplan or not? I guess they are even less “tested” with even more qulaity problems than the Kaplan one.


Did the am of the Boston Mock today. That was a rather poor representation of the exam in my opinion