How to Prepare for CFA level 1: An Actionable Study Guide

The Chartered Financial Analyst (CFA) designation is among the most respected in the finance industry. To earn it, you'll need to pass three levels of rigorous exams, starting with Level 1. Here are some actionable tips to help you ace the CFA Level 1 exam.

1. Understand the Exam Format and Structure
The CFA Level 1 exam is a six-hour examination, divided into two sessions of three hours each, morning and afternoon. The exam comprises 240 multiple-choice questions covering a broad range of topics, including Ethical and Professional Standards, Quantitative Methods, Economics, Financial Reporting and Analysis, Corporate Finance, Portfolio Management, Equity, Fixed Income, Derivatives, and Alternative Investments.

2. Create a Study Plan
Given the breadth and depth of topics covered, creating a structured study plan is crucial. The CFA Institute recommends at least 300 hours of study. Start by determining the number of study hours you can commit each week, then divide the topics accordingly. Allocate more time to challenging or high-weightage areas.

​3. Use the CFA Institute's Learning Ecosystem
The CFA Institute provides a Learning Ecosystem with extensive study materials for registered candidates. It includes the complete curriculum, practice questions, and mock exams. Take advantage of these resources to familiarize yourself with the content and exam format.

4. Understand and Apply the Ethical Standards
Ethics is a cornerstone of the CFA Program, and it's also an area where many candidates struggle. Read the Code of Ethics and Standards of Professional Conduct thoroughly, and understand how to apply them in different situations. Ethical dilemmas often show up in the exam, so practice answering these types of questions.
​
5. Master Financial Reporting and Analysis
This is one of the most challenging sections for many candidates but is also heavily weighted. Familiarize yourself with financial statements, how they link together, and how to analyze them. Understanding this section will also be beneficial for the Equity and Corporate Finance sections.

6. Practice Extensively
The key to passing the CFA Level 1 exam is to practice as much as possible. The more questions you solve, the more familiar you will become with the types of questions asked and how to tackle them. Make use of the practice questions and mock exams provided by the CFA Institute.

7. Review Regularly
Given the large volume of material, regular review is essential. Try to revisit topics regularly to ensure that you retain the information you have learned. Making summary notes or flashcards can help you quickly recall key points.

8. Take Care of Your Health
Don't underestimate the importance of good health during your preparation. Regular exercise, healthy eating, and sufficient sleep can greatly improve your cognitive function and stress management. Make sure to take regular breaks during your study sessions to avoid burnout.

9. Be Exam Ready
A week before the exam, shift your focus from learning new material to consolidating what you've learned. Take full-length practice exams to build stamina and understand your pace. Also, familiarize yourself with the exam day rules and logistics to avoid last-minute stress.

Conclusion
Passing the CFA Level 1 exam requires a solid understanding of financial concepts, diligent preparation, and effective exam-taking strategies. By following the tips outlined above, you will be well-prepared to ace the exam. Remember, consistency and perseverance are key to achieving your CFA charter. Good luck!

In order to help you prepare for the CFA exams we developed the following short CFA tests: