Some general questions about CFA L1...

Hi there, I’m thinking of getting started with the CFA program, but I wanted to get some idea of the sort of math involved in it, as I imagine that math will be the part of L1 I have the most difficulty with. So, with respect to CFA L1: 1. What exactly is the math level required? What kind of math do you need to know (algebra, trig, calc, etc), and is it very high-level math? I have done the CSC (Canadian equivalent of Series 7) and am comfortable with algebra and fractional/percentage math, but not much more then that. 2. I know there’s a lot of statistics on L1. I have no experience with stats - is the level of stats on L1 something I can pick up with a high school level stats textbook? Or is it more advanced then that? As I was saying, I’ve completed the CSC with Honours and minored in Economics at University, and as such am already aware of about 40-50% of the material on CFA L1. I’m just unsure of whether I can overcome the math portions or not. Thanks!

np heavy math and stats you can learn from the books. if you really want to prepare, I would suggest an entry level stats book from any good undergrad or MBA program and then move into the cirriculum. people pass this exam all the time with limited finance background, but that is not to say it is not hard. you get out what you put in. good luck

Hi brafique, I’m studying for Dec right now and I’ve read 3/4 of the material. I’m in a similar situation like you - my major in University was Econ & I also completed the CSC. The Quantitative Methods book is mostly stats. I must admit that I struggled with it a bit & it definitely is my worst area. However I’ve only read it once bc I needed to move on to other topics. I don’t think it’s a very high level of math though. It’s not that similar to the math required for CSC… more similar to a stats course I was required to take as part of the Econ major. You didn’t take any stats course at all in University? So basically, I don’t like stats & Quant was challenging for me, but I don’t think you should not take the CFA bc you’re scared of the level of Math required. There’s a lot of other things to learn in CFA… and if you found CSC to be interesting, I think you’ll enjoy the CFA material.

Thanks for the replies…does anybody else have any input on this? I appreciate all the input I can get! cfa08 - I did my Minor in economics (Major in Poli Sci) so I didn’t have to do any stats…I wish I had now!

The stats at L1 are a piece of cake, nothing complicated. Sure it goes beyond algebra and fractional/percentage math, but L1 is not a math/stats PhD course. There are PLENTY of other concepts (in economics, in FSA, corporate finance, derivatives and alternative investments) that you need to understand, retain and apply in the exam, to a fairly detailed level. Some of them build on the stats, better said quants, in the first readings. You can do it. Just put your mind to it.

the stats/probability material conceptually is pretty much a joke, but might be somewhat challenging to retain (read: memorize) if you’re not very much into math… overall i think quant will be the least of your worries bonne chance

Quant is weighted low all L1 and L2, and isn’t even in L3 anymore…you can make up for weak points in tons of other areas.

youll have no probs with the stats in Level 1. it only comprises about 8-10% of the LOSs. half in quant and half in portfolio mgmt. its really not that hard and as map1 said, there are more important concepts to grasp then the maths/stats in this exam - accg/FSA being one of them.

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djjk1 Wrote: ------------------------------------------------------- > youll have no probs with the stats in Level 1. it > only comprises about 8-10% of the LOSs. half in > quant and half in portfolio mgmt. its really not > that hard and as map1 said, there are more > important concepts to grasp then the maths/stats > in this exam - accg/FSA being one of them. I keep hearing about FSA…what makes is to tough on L1? Everyone seems to hate it!

my friend my friend… saying you know 40-50% of the material is a huge overstatement. FSA will make you hate accounting. and for a short time, your life. The stats is simple, the math is simple. the concepts on the other hand…eh…

The CSC, although necessary, is no comparison. That has a pass rate of 99% and that is people of all walks of life taking it. This has a pass rate of 35% and has usually very intelligent and committed people taking it. Not to discourage you at all but knowledge of the CSC course is of very little relevance in Level 1

^ Of course CFAL1 expands greatly on topics touched upon in CSC, but from my skimming of the CFA text, there certainly are lots of terms and concepts that sound familiar from CSC. Stuff like FIFO/LIFO, financial statement analysis ratios, portfolio correlations, how put and call options work, etc.

To cfa08, how did you find the CSC material? With the 50% overlap, I’m thinking of writing it after level one but not spending more than say 1.5 month studying for it. Doable?

I wrote the two parts to the CSC right out a finance major at university, read the first book and wrote the exam, and didn’t open the second book and wrote the exam, if you have a background (you will with level one) you will find them very very simple

TheAliMan Wrote: ------------------------------------------------------- > To cfa08, how did you find the CSC material? With > the 50% overlap, I’m thinking of writing it after > level one but not spending more than say 1.5 month > studying for it. Doable? The CSC material isn’t difficult at all coming from a CFA L1 background. I wrote both levels of the CSC within a few months starting from an absolute 0 finance knowledge base (I didn’t even know the difference between a stock and a bond), and completed the course with Honours. So definitely doable.

TheAliMan Wrote: ------------------------------------------------------- > To cfa08, how did you find the CSC material? With > the 50% overlap, I’m thinking of writing it after > level one but not spending more than say 1.5 month > studying for it. Doable? Hi AliMan, Doing CSC after CFA L1 should be really easy. The CSC concepts are very intro & easy to understand. It’s definitely doable in 1.5 months - you just need to read the two textbooks once through & you’re good. I don’t know if I’d say there’s a 50% overlap though… I don’t think it’s that much. And coming from the other end, having a CSC & doing CFA L1, CSC is nothing compared to the CFA… there’s just so much more info to know in CFA & it goes quite a bit more indepth. You know what, now that I think about it… I don’t know how useful doing a CSC would be, after already having CFA L1. CFA is so much more valuable than CSC, I’m not sure if it’s worth your time & your $1K! So there’s a bunch of Canadians here eh! I find that it’s mostly Americans on this forum!