How Much Review Is Necessary for Cfa Level 2

CFA Level 2

If you expect at CFA Level two exam preparation tips, yous tin assume that you lot have already completed yourCFA Level 1 course. Firstly, congratulations, and adept luck with CFA Level ii! Now, let u.s.a. look at CFA Level ii and attempt to pass out with a similar intensity. CFA Level 2 examination is considered the toughest of the three levels of the CFA exam.

We have brought a comprehensive guide that will assist you know what you can expect from the CFA Level ii exam. This guide volition cover the syllabus, written report plan/tips, pass rates, and results to get you started. So read slowly, sympathise everything and let this article be your first preparation step.

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Source: CFA Level ii Test Weights, Study Program, Tips, Pass Rates, Fees (wallstreetmojo.com)

Without whatever ado, let's begin.

• About CFA Level 2 Test
• CFA Level ii Test Weights / Syllabus
• CFA Level ii Pass Rates
• CFA Level 2 Exam Format Key Highlights
• CFA Level 2 Study Programme / Prep Tips
• CFA Level ii Exam Fees
• Over to you lot!

Likewise, Complete the checkout Guide to CFA Exam The Chartered Financial Analyst (CFA®) Program offers a graduate-level curriculum and test program designed to aggrandize your working knowledge and practical skills related to investment decision-making. read more .

Nigh CFA Level 2 Exam

Examination	CFA Level two Examination
Fees	Standard registration fee $700 – $1,000.
Cadre Areas	Ideals, Quantitative Methods, Economics, Financial Reporting, and Analysis, Corporate Finance, Equity Investments, Fixed Income, Derivatives, Culling Investments, Portfolio Management and Wealth Planning.
CFA® Exam Dates	CFA® Level 2 is conducted iii times a yr (February, Aug, Nov).
The Deal	CFA Level two is a total-day six-hr test. Candidates must pass CFA Level ane before advancing to CFA Level ii but can echo a exam if they fail to laissez passer.
Format	Item sets / Mini case studies.
Number of Questions	120 questions. xx particular sets with 6 multiple choice questions each: – Session i- 10-item sets Session ii- 10-item sets.
Laissez passer Rate	46% in June 2016.
Recommended Study Hours	A minimum of 300 hours of preparation for CFA Level ii is recommended.
What next?	After passing CFA Level 2, you lot tin appear for the final CFA Level three. Once you articulate CFA Level 3, you are entitled to the CFA Charter (provided you have the requisite professional work experience).
Eligibility for CFA Charter	You must take one of the following: – Bachelor's (or equivalent) caste. The concluding yr of the bachelor's caste plan. Take four years of professional work experience. Having a combination of professional work and university experience of at to the lowest degree four years.
Official Website	www.cfainstitute.org

CFA Level 2 Exam Weights / Syllabus

The syllabus of CFA Level 2 is quite comprehensive. This section will look at each subject, their CFA Level 2 examination weights, and how you should arroyo each topic as you start your preparation.

source: CFA Institute

If yous discover, you may see that in CFA Level 2, the weightage is given to each subject field in almost similar propensity (not precisely). In Level i and Level 3, the intensity differs co-ordinate to subjects (fifty-fifty a few subjects you can skip), merely in CFA Level 2, you need to study all.

Ideals and Professional Standards – 10 – xv% weight

Ethics, for me, was i of the most challenging topics. Since I did non score well in CFA Level one in the Ethics department, I was adamant to spend more time on this department. My opinion would be to check how your score was in CFA Level one. You already take an fantabulous foundation if you have scored more than seventy%. Even so, please spend a off-white amount of time on this section if yous score lower. Delight do non forget that this department comes once more in CFA Level iii.

Quantitative Methods – 5-10%

Exercise not neglect Quantitative Methods. You may get one to two vignettes from this department. It was once more one of the most substantial areas, and I preferred to complete these sets of questions before attempting other complicated sections. Quantitative Methods are both formulae equally well as concept-oriented. You should not face many problems if you lot are from an engineering/maths background. Others, please exercise have the time to practice this section.

Economics – 5-10%

Expect two vignettes from this economic science section. Outset, the topics included are exchange charge per unit decision and forecast, economic growth and regulation,Macro vs. Microeconomics Macroeconomics examines the elements that influence the local, regional, national, or global economy, too as the overall economy'south averages and aggregates. Microeconomics, on the other mitt, is a narrower concept concerned with the decision-making of single economical variables and only interprets the economy's tiniest components. read more . Unfortunately, this section was one of my weaker areas. So, I read this section twice and skillful as many questions as possible.

Financial Reporting and Analysis – 10-15%

I loved this Financial Statement Analysis section. By far, for me, information technology was the easiest and most interesting one. However, I must say that this section is the hardest besides, mainly if yous are from a not-accounting background. CFA Level 2 financial reporting goes deep into individual concepts, so accept time to exercise as many questions as possible. Information technology was the end of the affiliate questions from CFA Found books that did the trick.

Corporate Finance – 5-ten%

Hither, you may wait 1-2 vignettes. Topics include Capital Budgeting, Majuscule Structure, Dividends,Share Buyback Share buyback refers to the repurchase of the visitor's own outstanding shares from the open marketplace using the accumulated funds of the company to decrease the outstanding shares in the company's balance sheet. This is done either to increase the value of the existing shares or to prevent diverse shareholders from controlling the visitor. read more than Repurchase, Corporate Governance,Mergers and Acquisitions Mergers and acquisitions (G&A) are collaborations betwixt two or more firms. In a merger, ii or more than companies functioning at the aforementioned level combine to create a new business organisation entity. In an acquisition, a larger organization buys a smaller business organization entity for expansion. read more than , and Corporate Performance. I found this section closely aligned with the Financial Reporting and Assay. My have is that this is low-hanging fruit. You should master this concept to score well in the CFA Level 2 examination.

Equity Investments – 10-15%

Along with Financial Reporting and Assay, this section is i of the foundation level sections of CFA level ii. Topics includeIndustry Analysis and Company Analysis, Dividend Disbelieve Valuation Model,Free Cash Flow to Firm FCFF (Gratis cash flow to house), or unleveled cash flow, is the cash remaining subsequently depreciation, taxes, and other investment costs are paid from the revenue. It represents the amount of cash menstruum available to all the funding holders – debt holders, stockholders, preferred stockholders or bondholders. read more ,Free Cash Menstruum to Equity FCFE (Free Greenbacks Flow to Disinterestedness) determines the remaining cash with the company's investors or disinterestedness shareholders afterward extending funds for debt repayment, interest payment and reinvestment. Information technology is an indicator of the company'south equity capital direction read more , Market-based Equity Multiple and Enterprise Valuation Multiples, andResidual Income Method Balance income refers to the net earnings an arrangement possess after paying off the price of uppercase. It is caused past deducting the equity charges from the company's cyberspace profit or income. read more . You must master this i! But, trust me, this 1 is easy likewise!

Fixed Income – ten-15%

You lot tin await 2-3 vignettes from theFixed Income Fixed Income refers to those investments that pay fixed interests and dividends to the investors until maturity. Regime and corporate bonds are examples of fixed income investments. read more section. This ane is the favorite of those who are skilful at Quantitative Analysis. Topics includeterm construction The term structure is the graphical representation that depicts the relationship between interest rates and various maturities. The graph itself is called a "yield curve." The term structure of involvement rates plays an essential office in any economy by predicting the future trajectory of rates. read more , time to come-forward, yields, swaps, an arbitrage-gratuitous valuation framework, valuation of bonds, embedded options,credit assay models Credit analysis is the process of drawing conclusions about an entity'due south creditworthiness based on bachelor data (both quantitative and qualitative) and making recommendations about perceived needs and risks. Credit analysis also involves identifying, assessing, and mitigating risks associated with an entity'due south failure to see financial commitments. read more , credit default swaps A Credit Default Swap (CDS) is a financial agreement between the CDS seller and heir-apparent. The CDS seller agrees to recoup the heir-apparent in case the payment defaults. In return, the CDS buyer makes periodic payments to the CDS seller till maturity. read more , etc. Many candidates find this role hard. Then, start with the necessary foundation of the topic and practice the questions as much equally possible.

Derivatives 5-ten%

Await 1-2 vignettes from the derivatives department. Topics here include pricing of frontward commitments, contingent claims,options trading strategies Options trading refers to a contract between the buyer and the seller, where the option holder bets on the future price of an underlying security or index. read more , etc. This one again is the favorite topic of Quant-oriented folks. There are various formulas here; all the same, you need to first get through the necessary foundations. Besides, make certain to practise these questions using your CFA calculator.

Alternative Investments – 5-ten%

Expect 1-two vignettes during your CFA level 2 exam. The important topics include Real Estate Investments,Private Disinterestedness Valuations, Commodities, and Commodity Derivatives. This topic is more conceptual with some numerical. Delight do not neglect this department every bit it may get a deal-billow.

Portfolio Management and Wealth Planning 10-xv%

Look 1-2 vignettes from Portfolio and Wealth management. This one can be very piece of cake or hard at the same fourth dimension. Do you lot read the topics very carefully? Information technology includes Portfolio Management, Investment Policy Statements, Multifactor Models, VAR, Economic Analysis, Active Management, and Trading. Make some fourth dimension learning the Investment Policy Statements as this is the right foundation of the most important topic found in CFA Level 3.

CFA Level 2 Pass Rates

Information technology is important to report hard. Knowing the pass rates beforehand helps yous intensify your grooming. In this section, we will expect at monumental data. From 1963 to 2016, nosotros volition investigate all the data and determine how effortless CFA Level 2 is.

CFA Level two Passing Rates between 1964-1981

The passing rates for CFA Level 2 were very high in the initial years. For case, betwixt 1964 and1981, the average passing rate for CFA Level 2 was 78%.

source: CFA Institute

CFA Level 2 Passing Rates betwixt 1982-2000

Betwixt 1982 and 2000, the average passing rate for CFA Level 2 dropped from 78% in the earlier period to 64%.

However, at that place was no ascent in the total number of CFA Level 2 candidates. On the contrary, the number of candidates actualization for CFA Level 2 increased dramatically.

source: CFA Institute

CFA Level 2 Passing Rates between 2001-2016

• Between 2000 and 2016, the average passing rate for CFA Level two dropped further from earlier periods to 44%.
• In June 2016, the passing rate for CFA level 2 was 46%.
• Also, you may annotation that the total number of candidates appearing for CFA Level ii steadily increased during these 15 years.

source: CFA Institute

Every bit you lot tin run into, the intensity of CFA Level 2 requires studying hard. So, buckle upwards and outset preparing.

CFA Level 2 Exam Format Cardinal Highlights

Before we go ahead and talk well-nigh written report tips, have a look at the test format so that you can set up yourself accordingly.

Unlike the CFA Level 1 exam, in CFA Level 2, you demand to understand each concept in depth to reply vignettes (mini-cases) comfortably.

Exam	CFA Level 2
Number of questions (total)	120
Type of question	Vignettes (Mini-cases)
Fourth dimension allotted	360 minutes
Full marks	360 points
Every correct respond	iii points
Every incorrect respond	No penalty
Sessions	two (Morning & Afternoon)
Set of questions in each session	10
In each question, the number of vignettes	6

source: CFA Establish

• There would exist 10-item gear up questions in the morning session, each fix containing six vignettes.
• It would need to opt for 10-item gear up questions containing the aforementioned six vignettes in the afternoon session.
• In that location will exist a total of 360 points for the whole test. You would be given 3 points for each correct answer, and at that place is no penalty for any incorrect respond. The duration would be 360 minutes (half dozen hours) for the whole exam.
• The major modify in the blueprint is that there is a 10-detail set (each around 400-800 words) with half-dozen multiple-choice questions in each session (morning and afternoon session). These six questions may be dependent or independent of each other.
• Each item fix question covers only ane study session (FSA, Ethics, Portfolio), making it easier to solve the vignette.

CFA Level 2 Study Programme / Prep Tips

If you take just passed CFA Level 1 and remember that yous may crack CFA Level 2 exam at one time, then you may have estimated the difficulty level of the CFA Level 2 exam by the number of questions. Unfortunately, while the number of questions in the CFA Level 2 exam is certainly lower, the difficulty level of the exam is much higher than CFA Level ane.

Here are the few things you need to keep in heed if you want to crack the CFA Level 2 exam in one go.

CFA Level 2 exam is the hardest of all level

• No, information technology is non what we are saying. Rather, it is advised past the professionals who have already excelled in CFA. According to them, past some means, the CFA Level two exam is the toughest compared to its other two counterparts.
• There are several reasons for that. First of all, CFA Level 1 is easier for people who are good in finance and possess a background in economics and maths.
• Secondly, when the students are transitioning from Level 1 to Level two, they cannot empathise the difficulty level of the CFA Level 2 examination until they face the questions in the examination hall.
• Of course, these are generalized statements and do not include everybody. Despite that, in that location is truth in these statements. Then do not have the CFA Level 2 examination lightly.
• Also, annotation that at present with CFA Level two, the competition is between serious candidates who have surpassed the Level 1 examination.

You lot need to double your preparation time:

• If you have studied 2-3 hours a twenty-four hours for the CFA Level 1 test, you lot need to double that amount every 24-hour interval to pass the CFA Level ii exam.
• And require much more depth in comprehending the concepts than you did in the CFA Level 1 exam. Oft the vignettes are too straightforward, and you need to answer only i thing without having any chance to elaborate.
• Program and have aplenty time to report the whole curriculum at least three times. And so practise sample questions so that yous do not experience a certain burst of shock while attempting the vignettes in the examination hall.

Know the weights of the subject field (according to item sets):

• It would help if y'all were a know-information technology-all sorcerer. Aye, we do not uncertainty that.
• Simply notwithstanding, you lot demand to prioritize and give more weight to the subjects that can act mightier in the item ready questions. So, you demand to know what to expect from them.
• Four topics – Ethics, Fiscal Reporting & Analysis, Disinterestedness Investment, and Stock-still Income stand for approx. l%-80% of the weightage.

Basics of CFA Level 1 would be required.

• CFA is a dynamic course, and each level is intertwined.
• And then, if you want to make your marking in the CFA Level 2 test, you need to exist thorough with the foundation concepts of CFA Level i.
• You may besides demand to get back and understand a few concepts in the CFA Level 1 test.

Requite special attention to the distribution of time:

• Vignette-type questions take more time to answer than any multiple-selection blazon questions.
• Thus, it would help if you practiced a lot more before you lot always got to respond everything in the examination hall perfectly. In the concluding department, we will discuss sample questions to get an idea about what to wait in the question paper.
• Practicing sample questions is a must; otherwise, it would be difficult to articulate the CFA Level 2 exam in i shot.

Should you read the vignette first or read the questions first?

• Many candidates prefer to read the questions first to understand the kind of questions expected from the vignette (numerical, conceptual, factual) then the instance report. Nevertheless, I have never tried this approach.
• My arroyo was straightforward. I used to read the vignette rapidly before the question. To answer the questions, you will have to refer back to vignettes.

Effort to Score more than 70% in each department.

• CFA does non provide private section passing scores.
• All the same, it is safe to assume that you would not fail if yous scored more than lxx% in each section.
• As a strategy, I used to pick sections where I was determined. My best department was Financial Reporting and Analysis.
• Choosing the strongest helps you lot build confidence during the exam and also enables you to save valuable time that yous tin can use for attempting the weaker sections.

CFA Level 2 Exam Fees

Knowing how much y'all demand to pay for the CFA Level ii exam is of import. So, allow united states of america have a look. You have already paid the enrolment fees every bit you have passed out from the CFA Level 1 exam. Hither are the June 2017 exam details if you want to sit for the CFA Level ii exam.

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source: CFA Found

While paying the test registration fees, you would exist receiving the following things: –

• The e-book contains everything needed to study for the exam (the complete curriculum, to exist precise).
• You volition receive a study planner that helps track your exam preparation and guide you alee of fourth dimension.
• You volition also get topic-based practice tests.
• You will also acquire mock exams.
• Lastly, you will be given a mobile app to help you lot access everything else mentioned in a higher place.

To purchase a print version of the complete curriculum, you tin pay the non-refundable $150 plus shipping.

Over to You!

CFA Level ii exam is the most hard test in finance compared to all the courses in the finance domain. Y'all know at present why the CFA Level 2 exam needs all your endeavor, fourth dimension, and difficult piece of work from the above examples, stats, tips, and sample questions.

And if yous are a working professional, you need to prioritize your schedule so that you get to study daily for a few hours. Oftentimes, it is hard, and you may feel like not doing information technology. Only for a twelvemonth, if you lot can pursue this schedule, you lot volition certainly see it in your results. I hope this guide has helped you shape your idea of how to showtime preparing for the CFA Level ii exam. Go started right abroad. The clock is ticking.

Expert Luck!

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