Chartered Financial Analyst Exam (CFA Exam)


The term Chartered Financial Analyst Exam refers to a series of tests that assesses the candidate's ability to analyze investments and manage portfolios in real-world situations.  The Chartered Financial Analyst Examination, or CFA Exam, is developed and administered by the CFA Institute.   The purpose of the examination is to ensure individuals are able to bridge academic theory, industry practice, and ethical standards when analyzing investments.


The Chartered Financial Analyst Exam, or CFA Exam, refers to a series of three tests that ensure individuals meet the high standards of the profession; candidates that pass all three examinations become CFA Charterholders.  The examination is administered via testing centers located throughout the world.  The schedule and sequence for all three levels appears below:

  • Level I:  a six hour examination offered in June and December each year, the focus of this test is on a basic knowledge of ten topic areas and simple analysis using investment tools.
  • Level II:  a six hour examination offered in June each year, the focus of this test is on the application of investment tools and concepts used to value assets of various types.
  • Level III:  a six hour examination offered in June each year, the focus of this test is the synthesis of concepts and analytical techniques with the objective of effectively managing portfolios and wealth planning.

In addition to multiple choice questions, each examination contains what are termed "item set" and "constructed response" formats (Level II only).  An item set is a mini case study, consisting of a vignette followed by six multiple choice questions.  The constructed response format requires the examinee to answer questions using an essay.   The topics covered in the CFA Exam include:

  • Alternative Investments
  • Corporate Finance
  • Derivatives
  • Economics
  • Equity Investments
  • Ethical and Professional Standards
  • Financial Reporting and Analysis
  • Fixed-income Investments
  • Portfolio Management and Wealth Planning
  • Quantitative Methods

The three examinations must be passed sequentially.  Multiple choice and item set responses are scored electronically, while constructed responses are scored by charterholder volunteers.  Candidates receive the results of their exams scores in bands (<50%, 50-70%, >70%).  The minimum passing score (MPS) is determined by the CFA Institute Board of Governors each year after the examination is administered.  Historically, pass rates are relatively low, with Level I being around 40%, Level II at 45% and Level III closer to 50%.  The CFA Institute does not limit the number of times a candidate may take an examination.

Related Terms

CFP Exam, CPA Exam, CFS Exam, ChFC Exam, CICCIMA, CMT, FRM Exam