I made a rookie mistake in my Level 3 exam years ago, with 3 whole constructed-response questions left to do in 15 minutes. However, what I did next thankfully contributed to an overall pass.
Here’s a thorough account of my CFA Level 3 study guide with some useful insights, which I hope would be helpful for your (fingers crossed) last CFA exam.
This article covers key questions about CFA Level 3 exam, details of my study plan so you can use this as a base reference when customizing your own study plan, with specific Level 3 study tips to help your exam preparation.
Let’s check it out!
CFA Level 3 is a computer-based exam held twice a year in February and August.
Unlike Level 2 which is heavily quantitative and calculation-based, the real challenge in CFA Level 3 is lies in the more qualitative nature of the questions combined with half the paper being a constructed-response (written, non multiple choice) format.
We need to understand what CFA Level 3 is about to beat it.
Let’s go through some common questions I’ve received from candidates recently (and my answers):
Although not tested as part of the exam, there is also a mandatory requirement from 2025 to complete one Practical Skills Module (PSM) prior to results announcement.
A PSM consists of a combination of videos, multiple-choice questions, guided practice, and case studies to develop candidates’ practical skills. It takes about 10-20 hours per module to complete.
Well, we ourselves are divided on this question at 300Hours!
CFA Level 2 is difficult for the sheer amount of materials you have to learn and know how to calculate, whereas CFA Level 3’s curveball is the constructed-response format and the more qualitative nature of the questions.
However, once you’ve learnt how to answer succinctly in the Level 3’s constructed-response format, on balance, Level 2 is probably the more difficult paper.
The latest pass rate for CFA Level 3 is 49% (Feb 2024), with an average of 50% for 2014-2024.
Since 2021, there has been a step change in historical trends of CFA pass rates for all levels, so it’s best to check out this article for the latest updates.
The exam fees for CFA Level 3 are US$940-1,250, depending on how early you register.
There are other optional additional fees to consider too, such as physical copies of the curriculum, rescheduling fee and third party study materials.
For a complete breakdown and thorough estimate of CFA Level 3 exam costs, check out this article.
CFA Level 3 Topic Area | Topic Weight in 2024 |
---|---|
Ethics | 10-15% |
Quantitative Methods | – |
Economics | 5-10% |
Financial Reporting & Analysis | – |
Corporate Finance | – |
Equity Investments | 10-15% |
Fixed Income | 15-20% |
Derivatives | 5-10% |
Alternative Investments | 5-10% |
Portfolio Management | 35-40% |
What is interesting about the recently changed CFA Level 3 weights is that it is possible to test all topics more evenly (excluding PM and Fixed Income), probably done as a move to discourage candidates from dropping topics.
For those considering using previous year’s books to study, it’s worth referring to the latest 2023 CFA curriculum changes article to check how much the curriculum has changed over the year.
Based on CFA Institute’s June 2019 Candidate Survey, the average CFA Level 3 candidate studied for 344 hours. However, based on our experience to increase chances of passing, studying for a minimum of 350 hours over 4-6 months is more common.
I would recommend having a look at the CFA Fast Track Plan as a guide (for students, working professionals and parents), then use our latest updated Free CFA Study Planner to customize your study plan to get going!
Unlike FRM, the CFA program doesn’t impose any time limit between levels, nor impose any time limit to complete all 3 levels, which is certainly helpful to have such flexibility.
However, candidates may lose momentum and motivation if they take a too long a break between exam levels.
For Level 3, I didn’t use CFA curriculum as my main reference and relied on third party materials. I had a soft start to studying 6.5 months before, but only really started ramping up and properly studying with 6 months to the exams.
I just about scraped through and passed my Level 3 exam with a full time banking job in 6 months. The more qualitative nature of CFA Level 3 requires some adjustments in strategy vs Level 1 & 2.
Here are the details of my study plan, which you can easily use as a reference to tailor your study plan:
Besides the 10 Commandments of CFA Level 3 (super useful by the way), here are 4 key principles that I found crucial for passing Level 3:
I may sound like an old broken record, but this is worth repeating. No matter how experienced a candidate you think you are – practice is quite different from the real thing.
First thing to do when your first Level 3 paper starts is to see how much time you have per question, as number of questions vary from year to year.
As question length can vary, use the number of minutes/points to each question (this should be shown in the exam paper) to both inform you on how much time you should spend on the question, and how much information should you aim to put in your answer.
For time management purposes, consider 1 point to equal 1 minute of time to be spent on that essay question.
Second thing to do is to make sure you stick to your time limit per question, i.e. the ‘shoot-and-go’ principle.
If time is up, choose/write an answer, and move on.
This is the only way you have a chance to attempt each question, even if you’re not sure (this feeling could permeate the whole exam)!
For the first paper, it’s a little more trickier than having a multiple choice to ‘shoot’ and move on. But if you really are stuck, just write your best answer down and move on.
There is no negative marking, and my Level 3 experience showed that writing something down, such as showing your calculations or workings, helps maximize your scores even if the final answer is incorrect.
There would be (a lot of) moments in the constructed-response section where you have absolutely no clue of the answer, but some vague possibilities.
List those possible answers (limit to 2-3 only) on the side in pencil as a reminder, BUT pick the best answer for now and type them on the answer sheet. You can always revisit this if you have extra time later, but at least you have covered your bases.
The common tendency when we’re not sure of an answer is to start writing a lot. Let’s include everything, maybe something will stick!
That’s not a good idea unfortunately. CFA examiners recommend writing succinct, straight to the point answers with no fluff. This means use bullet points, short sentences, shorthands for formula notation etc – these are all acceptable and in fact encouraged!
The reason is two-fold:
However, for questions requiring calculations, DO show your calculation methods for arriving at your answer. Even if the final answer is wrong, you may get awarded points for the right working or formula application and you’d be surprised how many points you can get with those!
You’re already in the exam and nearly there. No matter what happens, just chug on and finish it the best you can. You’ll be amazed how smart, resilient and resourceful you are when you face up to these challenges.
When shit hits the fan, your mental power is key. Your choice of reaction will determine the outcome.
Always be thinking: what can you do to salvage the current situation for the best outcome?
This attitude saved my ass during the constructed response part of the exam where I lost track of time and are left with 3 whole questions to do in 15 minutes – I just blasted through all the questions quickly and wrote something in all of them before time’s up.
This positive mind power is also cultivated way before the exam. I had a several funny and motivational posters, pinned on my board during the months of studying.
It made me smile and kept me going on days where I was feeling meh/argh/why-did-I-get-myself-into-this. Try it and let me know if it works for you as well?
I hope you find my CFA experiences helpful for your preparation. Let me know if you have further questions in the comments below and feel free to share your tips too!
Meanwhile, you may find my Level 1 and 2 experiences below, along with some other useful articles:
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View Comments
Hi Sophie,
I got my result on 11 April and didn't cleared my exams. Also, haven't started preparing yet. I wanted to take your advice that shall I appear for August 2024 or appear for Feb 2025 exams? Considering, Feb 2025 format is going to change.
Hi Hardik, sorry to hear that. But hopefully you are close enough to the charter to try again. My comment will be late for this as Aug 2024 registration has closed but we did write a specialized pathway article you can refer to.
I think i will fail the level 3 exam and need to give it again please help.
i need a different strategy please help.
I am totally confused about which is the best prep provider for CFA III. PLEASE HELP!
You can check out our Reviews tab - we include ratings by CFA level so you'll have data to decide which provider is best for you. Good luck!
Hi Sophie, I am guessing you might have come across this question before but it will be helpful if you anwser it again. I am Level III candidate and have just started preparing for the exam and I am currently confused about the approach to take . For Level I and II , I only used Schweser notes and didn't have any problem doing well in the exam. But for LIII did you prepare solely from Schweser or did you use the CFA Institute book, especially for- Behavioural Finance, Portfolio Management-Individual & Institutional? So far, I have come across pro and con for both approaches. Would be interesting to hear what your study style was. I am personally inclined towards only using Schweser as my understanding is ( and as stated in your post above) that as long as we are precise and answer the question, we should be fine and I would imagine , Schweser does that by highlighting only the key learnings , even for the verbose topics I have highlighted above? But would be interesting to know if you would think otherwise.
Hi Pogotosh, I only knew of Schweser when I took the CFA and used their reference books exclusively for my study, as I didn't have time to look through the CFA institute books and could only muster the energy to study on weekends. Since you're starting early in your L3 revision, my suggestion would be to focus on Schweser in your studies to cover all your bases, as you are used to their formats for the past 2 levels. Then, with additional time when you practice your papers, you can use CFA Institute books as extra reference/practice for areas you find you're weaker in. Hope this helps! Sophie
great am now beginning with level 1.Please can i get your email address.i need some help.bennyhope2011@gmail.com..Thanks
Hi Mokpokpo If you have any questions, do post it here so its shared with the community (they're a helpful bunch!), or if its something more private, just post it at "Ask a Question" section. Sophie S