Which topic do we start CFA level 2 preps from ?

Hey guys ,

I am going to be writting CFA level 2 next year and i wanted to know which topic would be the best topic to start from . As i am going to do self studying , i guess a little headstart and some guidance would help . Like in Level 1 , most of the topics were a derivation from FRA and Quants . so , is it the case with level 2 also ? if so , what would be good topics to start from so I can revise it while doing other topics .

Thanking ,


It can’t hurt to start with FRA and Equity, the two biggest topic areas in the curriculum.

There isn’t as much, if any, topic crossover in Level II, so the study order doesn’t really matter in my opinion. Level II builds upon Level I concepts, and introduces new material that is mostly independant of other topics in the ciriculum. I studied Level II in order, with the exception of skipping Ethics until the end and I don’t feel I could have improved learning the material by approching it in a different order.

I disagree that there isn’t any overlap-- there is actually a bit between QM, Equity, and PM (and some other areas). Even if the concepts aren’t directly related, you can still see a general connection between many of them. However, they do explain some of the ideas again, so you probably could study them out of order. Similar to you, though, I studied the curriculum in order, and I felt the ordering was appropriate.

I fiddled with the order slightly, just because I couldn’t handle going from a boring study session (corpfin) straight to another boring one (alternative inv.). So I did fixed income before doing alt. But I agree the proposed order is the right way to go.

If you’re using Schweser - just go in order. It just flows a lot better. You won’t remember anything about Quant - at least that happened to me… So glad I brushed up there in the week before the test. If you’ve taken advanced statistics in college, don’t waste time there until later.

I say -> FRA & Equity. You can never go wrong there.

Theres tons of topic crossover in L2 in the CFAI content from what I saw.

The stand alone stuff was mostly at the beginning (Ethics, QM, Econ, FRA). If youre starting this far out, it couldnt hurt to go through them but theyre mostly rote - I didnt remember a thing from them after a couple months. I mean I went through my notes and had a hard time believing I wrote the words on the page. If I were to do it again, Id start on Corp Fin (super easy, good to set a pace), power through FRA (aim for just a general idea of things, dont worry about memorization yet), then give a slow, thorough pass through the remaining content in order with a particular focus on EQ, FI, and DI. When you finish, hit the stuff you skipped and a thorough review of FRA.

Im way better at math and logic than I am at memorization so adjust to your capabilities.

I agree with the overlap in a lot of areas, but I wouldn’t say QM is a standalone section…did you notice the overlap with QM and equity/PM, mainly… factor models, credit risk models using logistic regression (if I recall), Altman Z-score using Multiple Discriminant Analysis (MDA, don’t remember which section), market model, principal components analysis (PCA) was in FI (should be covered a little in QM, in my opinion-- it’s actually a method for dealing with multicollinearity if you’re building a regression for predictive purposes), etc…I definitely think having a strong understanding of QM will make these topics click faster and stick in your memory more easily.

There’s also a lot of overlap between Corporate Finance and Equity.

I even recall sections that are almost identical in content between certain sections (can’t remember which books, exactly). I think WACC in CF and Equity is one example, but the DCF techniques are presented a few times, Residual Income, Economic Profit, and many more…

(Edit: Oops, misunderstood the overlap discussion. Thought we were talking about from L1.)

I always do Ethics last, so I started with Quants with the intention to go in order from there and that did not set a good tone for me. I struggled badly with QM at first so it took me a few weeks to realize I had to abandon that and move onto Econ. Then I kept going in order, and by the time I got back to QM I felt much better about where I stood. Just a personal preference, but if I had to go back I’d have probably begun with CF or Equity knowing what I know now about what’s in those big ol’ books.

Dude, we’re still in June.

Just sit back, relax and enjoy the summer. You will need this break when the winter comes…

Winter is indeed coming.

FWIW, I followed this technique and circled back around to FRA as I learned it first: http://www.300hours.com/blog/what-is-the-most-effective-level-ii-cfa-exam-study-session-order#.VZKtL_lViko

If you are starting this early, you won’t remember anything from July, come December when you might have done one pass through.

Sh*t, I barely remembered anything I read 2 days ago when I was studying for it.

You *should* go through the material multiple times to be very confident of passing the test. I wish I had done that. Order doesn’t matter if you do it multiple times.

Thank you all for your views and time guys . from all the response it looks like unlike level 1 , there doesn’t seem to be an order or overlap . I guess then I will just start off with equity or fra like s2000 suggested . Thank you , Fudge

IMO start with ECO/AI/PM/…i guess everyone does big % topics pretty well and get dragged down by smaller ones( maybe like me…)

Starting this far out, go through everything once in order. It is really not that important. What is important is that you identify where you will have to focus your time on practice problems. For me, I dont think I really learned all that much in the derivative and fixed income sections from reading through the text. I learned from doing the practice problems. Since there are only so many ways you can ask the same question, the more questions you cover the odds are you will see something very similar on the actual exam.

Other topics, such as FRA, CorpFi, a few topic areas in Equity, and obviously ethics require you to read the text with a keen eye and make sure you understand the context and broader aspects of learning objectives.

  • know Equity & FRA inside out
  • save Ethics last
  • DO NOT skip any chapters (Quants/Econs), at least 3/6 questions will be basic & very easy points.

It’s important to pick the chapters that most interest you to get started, otherwise you will lose focus VERY fast (DO NOT START WITH FRA!!!).