Posted by Rebekah McLain on Wednesday, April 22, 2015 - 08:00
The chartered financial analyst (CFA) exam will be given on June 6. The stress accompanying this event has been known to cause some candidates to revert to primitive instincts. Brilliant financial minds morph into the werewolves of Wall Street.
And it’s no wonder: Depending on the level you’re sitting for, the exam, broken into stages, can extend for as long as six grueling hours. Being prepared is key, but even the most studied fail to succeed. Fewer than 20 percent of candidates pass all three tests on their first try, according to business-technology news website Business Insider. We want you to be one of the elite achievers. So we’ve gathered some tips to help you prepare, based on the real-life experiences of previous exam takers. We’ve also linked to some CFA horror stories featured in Business Insider.
1. Be punctual.
Show up late to the CFA exam, and you’re not getting in and may kiss your exam fees goodbye. Each host city tests at multiple venues. Triple-check the location, practice the route, plan ahead for construction, commute traffic and parking to spare yourself a mad dash across town, or worse yet, having to wait six months to a year to sit again. Arriving early will give you time to clear your head, sharpen your focus and get ready to methodically give it your best shot.
2. Know your acronyms.
Acronyms are no longer spelled out on the exam, so you need to know what those letters stand for before you arrive at the testing room. You can find a comprehensive list of acronyms for Levels I, II and III on the CFA Institute website.
3. Study, study, study.
The average test taker spends six months preparing for this examination. Broken down further, that’s in excess of 300 hours preparation, according to the CFA Institute. Allen Gillespie, chief investment officer of FinTrust Investment Advisors, said he didn’t have enough time to study for one attempt. He failed. He mulled over how to improve his odds of passing. Joining a study group or taking any number of exam prep courses are excellent ways to improve your discipline. Gillespie was so determined to pass the next time, he took the test in a tuxedo, because he was due at a wedding afterward. He also skipped the groom’s party the night before so he was on his A-game.
Immerse yourself in study guides, online training videos or mobile study apps. Michael Burkett of CCM Investment Advisers, LLC, said he found flashcards very helpful. He found the ethics portion of the exam particularly tricky. Burkett recommends studying and practicing this section ad nauseam, because if you fail ethics, you fail outright.
4. Be prepared beyond studying.
Prepare for the CFA exam like a survivalist. Think about everything you’ll need. Has your driver's license expired? Renew it, or you won’t make it through the door. Did you bring healthy snacks to keep those synapses firing? Do your two calculators have fresh batteries? Consider every possible scenario: stress headaches, upset stomachs and so forth. Some test takers even suggest bringing a change of clothes, just in case.
You may also want to bring earplugs to tune out pencil tapping or chatty proctors. When Burkett tested, he said it sounded like someone was jackhammering outside. Not exactly an ideal setting for such a difficult endeavor.
Finally, remember to be considerate of your fellow CFA test takers. Avoid wearing fragrances and try not to be a pencil tapper or a mutterer. Keep all of these tips in mind, and you could avoid having writing instruments and dirty looks thrown at you, or writing your own CFA exam horror story.
Do you have nightmarish stories to share from your chartered financial analyst exam? What would you suggest to first-time candidates? Let us know in the comments.