How I Passed CFA Level III On My First Attempt

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By Alexander Del Olmo Irizar

If you ask a CFA charterholder which CFA exam level they found the toughest, they are likely to answer either Level II or Level III. CFA Level III is especially challenging because the exam format also deviates from the multiple-choice format. The structured response format, or ‘essay’ section, can be very difficult to master for the CFA candidate used to multiple-choice questions.

After passing Level III last summer on my first attempt, I wanted to share my experience and hope it helps future candidates better approach the CFA Level III exam. Here’s my effort give something back to the 300 Hours community!

First problem: Which materials to use?

If you’ve been browsing the internet looking for information about Level 3, probably you have noticed that, unlike Levels 1 and 2, there are many views on which materials are best to pass the exam. You will need a solid knowledge of the concept behind each topic, mainly because each essay question often requires different study sessions to be resolved. In this respect, nothing beats CFA Institute syllabus and its extensive explanations. However, as you may be now thinking, extensive explanations mean extensive curriculum. And time is scarce and extremely valuable.

So, does this mean that you should use prep providers’ materials? Well, it is not a “one or another” choice. In fact, the combination of both may be the option that best optimizes the result. I read Kaplan Schweser and answered CFA curriculum’s End of Chapter questions (nothing new here, right?). But I would also use the curriculum as a supplement: switching to reading the curriculum if I saw that Schweser was not deep enough to answer EoC questions properly.

Ok, so how should I study this stuff?

As mentioned before, Level 3 is about concepts. This means lots of memorization. Trying to learn everything by heart won’t work, though. I repeat to make this very clear, it won’t work. Being a candidate with Management & Law background, I faced the temptation to memorize everything I didn’t understand, as if it was an article from the Civil Code. This temptation becomes bigger as the exam date gets closer. However, this is not a Law exam and you won’t be asked to repeat like a parrot. You will need to understand the concepts in order to apply them in questions containing both reasoning and numerical parts. 

To avoid this, read providers’ material and answer EoC questions from the official curriculum. Make sure you understand everything you read. If your scores in a specific topic are not as good as expected, read the corresponding pages from the curriculum.

Morning session: practice, practice, practice and practice some more.

You’ve passed Levels 1 and 2, so by now, you already know how important is practicing for the CFA exam. However, Level 3 AM session is a completely new game which you have never played. And you really want to win. It is essential to get used to the “essay format” questions. Probably you will know almost all the material by May, but the exam day, you will be expected to know how to put into words that knowledge in a limited time. And this is what will make the difference.

I wrote three timed morning session mock exams before May arrived. I completed none.

Time management is more important than ever. You must know what you are asked and how to answer it briefly, but accurately. The exam grader is looking for two or three ideas in each answer. It doesn’t matter if you used a Shakespearean prose or if you sounded like Sitting Bull. If you wrote those ideas, you got the points. If not, writing about related concepts that you know about won’t give you any points, so don’t waste your time. In addition, you are allowed to use bullet points and grammatical mistakes don’t deduct any points, so don’t worry if English isn’t your first language.

By the way, don’t panic if you’re on the last week prior to the exam and you’re unable to finish the morning session of your mocks. Of course, it is important to get as many points as possible, but I left a couple of questions blank on the exam day and still got the much-desired “Congratulations! We are very pleased to inform you that…”

Remember that for the morning (essay) session:

Really watch your time.
Use bullet points – short and to the point.
Grammatical errors don’t matter.

Afternoon session: don’t you dare to underestimate it.

So you already know the exam format from Level 2 and morning session requires tonnes of practice. This makes lots of candidates focus a lot on the AM session, deprioritizing the practice needed for the afternoon session.
This, as you may expect, is not a great idea. It’s 50% of your overall grade, and most likely the higher-scoring of the two sessions. Even if you study as hard as you can for morning session, it is very probable that you get 55%-65% of points. Thus, it is more important than ever to aim for a 70% grade in afternoon session so you can compensate a lower score in the morning. Make sure you go in strong to ensure that you have as good a chance as possible in passing. Remember my questions left blank? Well, let’s say that a nailed afternoon session can make a mediocre AM become a pass.

Take some days off before the exam, but not too many.
As recommended by the vast majority of previous CFA candidates, I took some days off from work to better prepare for the test. In both Level 1 and 2 I took off the week before the exam. However, being the last stage of this three-year adventure I wanted to make sure that I was going to pass. Thus, I decided to get two weeks off, that is, fourteen full days to focus on reviewing.
I scheduled these days the following way:

  • First two days: Relax. Time to disconnect from work and rest to be fresh for the following days.
  • Next seven days: Rereading the most important parts of my study notes.
  • Next four days: Writing one mock a day. Just as in the exam day, AM and PM sessions. Then, check the results and read the explanations of the incorrect answers.
  • Last day: Trying to take it easy, just review the formulas to make sure I knew them all.

The plan looked perfect at first sight. However, after five days of reviewing, the much-feared burnout appeared. I started to feel demotivated. Even if I knew that it was just a week more after three long years of studying, I was unable to focus and had to read every sentence at least two times. Trying to solve this serious problem I used two new methods: studying while taking a bath and cooking to disconnect. Luckily, these two ideas worked and I was able to stick to the plan (and my girlfriend ate good food for a week). However, if I was on the same situation again, I would consider the risk of study burnout before taking so many days off.

Always ask if you’re unsure.
Hopefully my experience and some of these tips will work for you too on the challenge that Level 3 represents. Furthermore, there’s There’s a lot of help available here at 300 Hours. If you have anything you’re not sure about, always remember you can reach out either at the Forum or just dropping a comment below.

Zee Tan
Author: Zee Tan


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