What is the CFA Level 1 Exam?

The CFA Level 1 exam is an exam required of all college graduates who want to work as a chartered financial analyst. This exam is available from the Chartered Financial Analyst Institute and is available twice a year. You can register to take the test in June or December. It’s important that you understand how to register, the requirements you must meet, the format of the test and how to prepare for it.

Requirements for Test Takers

According to the CFA Institute, you can only register to take the test if you have a bachelor’s degree in finance or are within one year from finishing your degree. You can also take the test if you have a bachelor’s degree in a similar subject matter.

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Test takers must also have a minimum of four years of professional work experience. You can sit for the exam with a combination of education and experience rather than having just four straight years of work experience. The Institute also requires that you show an international passport prior to taking the exam.

Registering for the Exam

When you register to take the CFA Level 1 exam, you must use the official website of the CFA Institute to select the testing center closest to you and the date you will take the exam. You will also need to pay an enrollment fee and a registration fee. The enrollment fee is a one-time fee, but you’ll pay the registration fee every time you take the test. The institute charges additional fees for those who register early and those who register after the deadline.

Test Structure

The CFA Level 1 exam is an extensive exam that lasts for several hours. It features two sessions that last for up to three hours. Though you can finish early, you cannot spend more than three hours on either section. Each section consists of 120 questions with three possible answers. Some questions will feature a simple sentence with one or missing words somewhere within the sentence. You select the answer that best fills in that blank spot. Other questions give you a fully worded sentence and ask you to select the response that best answers the question.

Types of Questions

Questions found on this exam fall into one of 10 different categories. Professional and ethical standards questions cover laws and ethics that you must follow in the field, while quantitative methods focus more on research and statistics. The exam will also test your knowledge of alternative and equity investments, derivatives, fixed income issues and corporate finance. You’ll also find questions relating to economics, portfolio management, financial reporting and financial analysis.

Preparing for the Exam

Once you pay your enrollment fee, you have access to resources designed to help you prepare for the CFA Level 1 exam. Those resources include examples of questions actually found on previous editions of the test and sample exams too. Those sample exams feature 240 questions divided into two sections that help you simulate taking the real test. You should also practice using your calculator as you take those sample questions to ensure that you know how to answer each one. Some colleges that offer finance degrees offer study groups for students taking the exam and classes that give you credit for preparing for the test.

You cannot work as a chartered financial analyst (CFA) without first taking the Level 1 exam. The exam is also available in a Level 2 and Level 3 format for those with more experience. Looking at how to register for the CFA Level 1 exam and the format of the exam can help you feel confident taking the test.