The CFA Syllabus, Explained With Two Cows

Ever feel that the CFA syllabus is a little incomprehensible at times?

Every topic makes sense when you’re going through it, but for me, it’s difficult to recall at short notice what each topic is about. 

10 main topics, each fairly different yet connected. How does one sum each topic up in a succinct way?

To help you along, we present to you the 10 CFA topics summarized using a two-cow analogy (ahem). Feel free to share and pass it on, or put it up on your wall while studying.


cfa syllabus or curriculum explained with two cows infographic


You have two cows.

You receive a farmer’s handbook.

You learn that if your cows produce extra milk today, you can’t tell friends and family first. Instead, you must announce it in the town square so that everyone knows at the same time.

But if you want to paint your cows magenta it should be totally OK, because the handbook doesn’t say that’s wrong.

Quantitative Methods

cfa level 1 quantitative methods

You have two cows.

Each cow gives 5 pints of milk daily, and gives birth to another milk-producing cow every 10 years.

You try and figure out how much your cow is worth if paid today.

In milk.

All at once.


You have two cows.

You shoot every other cow in the county.

You’re now the sole provider of milk.

Your farm can now maximize its profit through market inefficiencies.

Enjoy the rising milk prices.

Financial Reporting & Analysis

For milk volume record retention, the Farmers’ Agricultural Standards for Bovines (FASB) currently recognizes US-GALLON as the authoritative measure for milk.

However, as of 2021, the Society for Ethical Cattle (SEC) prefer the standardized LITER measurement.

Be sure to know the differences.

Corporate Finance


You name your cows Project 1 and Project 2.

Using NPV and IRR methods, you try and determine which is the better cow, and therefore your favorite.

Then you learn about sunk costs, and realize none of your calculations matter because you’ve already paid for the cows.

Portfolio Management

It’s not just about the milk.

You have to consider your cows’ likelihood of dying of old age, getting eaten by rabid hyenas, eloping to Vegas, or overthrowing the government.

Only then can you know what your cow is worth.


You have two cows.

Given that you know how much milk your cows produce, you calculate and value your cows’ sale price.

You write these prices daily with a marker on a big board in the middle of the town market.

This is called ‘mark to market’.

Fixed Income

Do your cows produce milk at a fixed volume, weather-dependent variable volumes, or do not produce milk at all?

This last category of cows are known as zero-coupon cows or bullet cows, because, you know.


paying shop transaction

You agree to buy two more cows from Farmer John one year from now for $3,500.

At time of sale, you find out that the market price of two cows is $4,000.

Farmer John is now not returning your… calls.

Alternative Investments

You sell one of your cows and buy a bull.

Forget milk – breeding is the next big thing.

Heh, hope that lightened up your day! Which is your favorite two cow CFA topic?

Meanwhile, you may find these related articles of interest:


37 thoughts on “The CFA Syllabus, Explained With Two Cows”

  1. Christine, Your weekly emails, posts and memes are bright spots in the trials and tribulations of studying for LII.

  2. I swear this was written with me in mind. I grew up on a dairy farm, currently a level III cadidate. “…bullet cows, probably because it’s just best to shoot them and sell them for beef at this point.”. genius

  3. This is just hilarious. I don’t know if it helps me remember the topics but just enjoyed reading it. Thanks Christine. Loved Ethics 😛

  4. Ha ha! This reminds me of that practice question in the CFA Ethics section where a portfolio manager realises that some securities are not Sharia-compliant as required by her client. “You have two cows, one bought specifically to be sold later to the abattoir for beef. Then you realise that this investment strategy is not Hindu-compliant as required by your client….”

  5. Even those of us not studying for CFA can find amusement (and value) from this one! LOL I got an extra giggle from the “economics” caption. Thanks for the read!

      • Uh oh. I think the stress is kicking in for Sandra. Ah well, I thought it was a good read lol. I still stand by the classic quote, ‘if you have nothing nice to say… don’t say anything at all’. But everyone’s entitled to their own opinion and she’s just exercising that first amendment. Well Christine, you’re doing an awesome job! This article definitely lightens up the mood for some of us. LOVE IT!

  6. What a delightful read….this analogy is definitely on point!! True depiction on the economic view hahahah!! Armoring up for June exams… o/ #Sips Milk


Leave a Comment

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.