What is still relevant from past Level III mock exams?

Before talking about questions from past mock exams which are still relevant, I want to acknowledge the fact that there have been debates on this forum as to whether or not it is ethical to use past-year mock exams published by the CFA Institute for exam preparation. My opinion is that it is okay because:

  • The CFA Institute has been making this material available to candidate over the years at no extra charge.
  • Some candidates will have taken the exam in the past and so will have past mock exams; it is only fair that other candidates also have an opportunity to practice from these mock exams.
  • The terms of use say that “… mock exam is provided to currently registered CFA candidates…” My interpretation is that currently registered candidates can use current and past mock exams.

If you are convinced that it unethical to practice from past mock exams then please read no further.

If you are still reading, I presume you agree with the opinion I expressed above. Now it is time for my second opinion: The CFA Institute’s questions are an excellent source of practice. This is particularly true for the Level III essay exam. You will notice that sample answers provided by the CFA Institute are short, crisp and to the point. This is how you need to write on the actual exam. Learn this technique now… and not in the last few days before the exam. By then it might be too late.

I do have a word of caution, though. The curriculum changes every year and hence some questions might not be relevant. The table below is my attempt at identifying questions from the 2006 to 2011 Level III essay exams which are still relevant for 2014 Level III candidates. I cannot guarantee that the information presented here is 100% accurate. If you spot any errors please write to me at arif@irfanullah.co. Next month I’ll try to update this post to identify relevant questions from the 2012 and 2013 exams.

Study hard. Practice harder.

Regards,

Arif Irfanullah

| Year | Question | Relevant | SS | Comment |
| 2006 | 1 | Yes | 4 | Individual IPS (return calculation, risks, constraints). Part D is irrelevant/obsolete |
| 2006 | 2 | Yes | 8 | ALM, Monte Carlo, Choosing appropriate asset allocation |
| 2006 | 3 | Yes | 9 | Pure bond indexing, active investing strategies |
| 2006 | 4 | Yes | 5 | DB Pension fund IPS, constraints, risk factors |
| 2006 | 5 | Yes | 8 | Strategic asset allocation, whether investments are suitable |
| 2006 | 6 | Yes | 5 | Differences between pension fund IPS and foundation IPS |
| 2006 | 7 | Yes | 8 | Corner portfolios |
| 2006 | 8 | Yes | 18 | GIPS |
| 2006 | 9 | No | | - |
| 2006 | 10 | Yes | 13 | Characteristics of hedge fund benchmarks (only part A is relevant) |
| 2006 | 11 | Yes | 16 | Components of trading costs (only part A is relevant) |
| 2006 | 12 | No | | - |
| 2007 | 1 | Yes | 3 and 4 | Individual IPS, Investor personality type |
| 2007 | 2 | Yes | 4 and 8 | Part A and B: Outright sale, Exchange funds, Completion Portfolios. Part C: Asset allocation |
| 2007 | 3 | Yes | 3 | Behavioral biases |
| 2007 | 4 | Yes | 8 | Asset classes, Black Litterman |
| 2007 | 5 | Yes | 5 | Endowment IPS, constraints, risk |
| 2007 | 6 | Yes | 5 | Life insurance company IPS, constraints, risks |
| 2007 | 7 | Yes | 16 | Corridor widths, rebalancing strategies |
| 2007 | 8 | Yes | 11 | Active management, style drift, core satellite |
| 2007 | 9 | Yes | 17 | Currency, security, market allocation return |
| 2007 | 10 | Yes | 6 | Grinold-Kroner Model (only part B and C are relevant) |
| 2008 | 1 | Yes | 4 | Individual IPS, constraints, risk ability |
| 2008 | 2 | Yes | 3 | Behavioral biases |
| 2008 | 3 | Yes | 5 | Pension fund IPS, constraints, risk factors |
| 2008 | 4 | Yes | 8 | Corner portfolios, Sharpe Ratio, Asset allocation, ALM approach |
| 2008 | 5 | Yes | 9 and 10 | Sector rotation trades, interest rate convexity, spread duration |
| 2008 | 6 | Yes | 13 | Cash and carry arbitrage |
| 2008 | 7 | Yes | 14 | Types of risk, stress testing methods |
| 2008 | 8 | Yes | 16 | Trading tactics, VWAP |
| 2008 | 9 | Yes | 16 | CPPI, Constant Mix, Buy and hold strategies |
| 2008 | 10 | Yes | 17 | Performance attribution analysis |
| 2008 | 11 | No | 17 | Obsolete |
| 2009 | 1 | Yes | 4 | Individual IPS, constraints, risk ability |
| 2009 | 2 | Yes | 4 | Life cycle investing |
| 2009 | 3 | Yes | 5 | Pension fund IPS, constraints, risk factors, Spending rule |
| 2009 | 4 | Yes | 5 | WACC, Pension assets in WACC calculations, Equity Beta |
| 2009 | 5 | Yes | 6 | Grinold-Kroner, Taylor Rule |
| 2009 | 6 | Yes | 8 | Strategic asset allocation, whether investments are suitable |
| 2009 | 7 | Yes | 11 | Active and passive equity investments, portfolio construction methods, investment styles |
| 2009 | 8 | Yes | 13 | Commodities, swaps |
| 2009 | 9 | Yes | 14 and 15 | Options, Counterparty risk, Credit risk in a swap |
| 2009 | 10 | Yes | 16 | Corridor widths, rebalancing strategies |
| 2009 | 11 | Yes | 17 | Benchmark selection, Performance measures (sharpe, m2, treynor, etc) |
| 2010 | 1 | Yes | 4 | Individual investor portfolios, TDA and Taxable accounts |
| 2010 | 2 | Yes | 3 and 5 | Insurance company IPS, behavioral biases |
| 2010 | 3 | Yes | 5 | Pension funds |
| 2010 | 4 | Yes | 6 and 7 | Only Part C is relevant |
| 2010 | 5 | Yes | 8 | Corner portfolios, Sharpe Ratio, Currency return and risk |
| 2010 | 6 | Yes | 9 | Immunization portfolio, Dollar Safety margin |
| 2010 | 7 | Yes | 15 | Option strategies (butterfly, straddle etc.) Target beta using futures |
| 2010 | 8 | Yes | 16 | VWAP, Implementation shortfall, corridor widths |
| 2010 | 9 | Yes | 17 | Benchmark selection, Performance Attribution |
| 2011 | 1 | Yes | 3 and 4 | Behavioral biases, Estate planning |
| 2011 | 2 | Yes | 4 | Individual investor portfolios |
| 2011 | 3 | Yes | 5 | Institutional investor portfolios |
| 2011 | 4 | Yes | 7 | Cobb douglas, H Model, Fed Model, Yardeni Model |
| 2011 | 5 | Yes | 8 | ALM, Black Litterman, Resampled frontier, Monte carlo |
| 2011 | 6 | Yes | 9 | Dollar duration, rebalancing, trade types, |
| 2011 | 7 | Yes | 12 | ADRs (Only Part E is revelant) |
| 2011 | 8 | Yes | 14 | Historical and Analytical VAR, Hedge currency risk using futures (Part A + B used in quiz) |
| 2011 | 9 | Yes | 17 | Performance attribution, sector allocation returns |

Thanks for this post - I’ve saved it for when I begin going through past exams.

Thanks a lot, great post!

It seems as if the bulk of mocks 2006-08 is still relevant for the exam. I actually thought about just doing the mock exams from 2009 on (together with 6 Schwesers). Is it advisable to aim for 2006-08 as well?

Another question regarding mocks:

Is it correct that there is no AM-Mock 2014 and for AM we just get the “past exams” until 2013?

Thanks for the post… can you provide a link or direct me to where we can find all the past mock exams?

If you’ve got 'em, there’s no reason not to do 'em! Those are actual past AM exams - do as many as you can! They’re more valuable than any of the six Schweser Practice Tests.

Many thanks Arif, very helpful.

I’m looking forward to seeing the same for 2012 and 2013, hopefully the majority of those questions will still be relevant.

Thanks so much!! You saved our precious time in looking into what’s relevant and what’s not.

Tks for this, is it up to date for the 2014 curriculum?

Looking at 2008 am Q6, there is a cash and carry arbitrage question which I thought had been dropped this year?

Tks again!

It would be amazing if you could update this to 2012 and 2013. Thanks a lot.

bumping for this

For Exam 2007

Question 2A and 2B not relevant. Low-Basis Stock reading was removed this year.

Question 7 isn’t relevant, it is a macro attribution question that was removed this year.

I think this question is no longer relevant in 2014. Haven’t seen cash and carry arbitrage neither in curriculum nor in schweser text. Someone can confirm that?

2009 number 4… wacc calc for pensions? equity/debt betas?

don’t remember this from curriculum

definitely not

Yeah, basically after doing some of these, roughly 1-3 questions in each AM are out. In PM there are also couple singe questions out, but not entire vignettes.

There must have been quiet a big shift in material between 2013 and 2014.

Where are you finding the PM questions? Arent only the AM available on the website?

I’ve done 2009 - 2013 AM sections and maybe plucked 2 questions TOTAL (pension WACC (2009 Q#4) and corporate governance/incentives (2011 Q#7)). For the most part, I’ve found the AM portions to be very relevant. As for the PM portions, I’ve done 2011 - 2013 and found no need to skip any questions.

where did you get the PM portions from? I see only 3 past AM exams on the CFAI web site.

The internet is vast…

Totally, but i didnt even know they posted the PM section. Do you just mean those silly item set examples? This years has like 18 questions…