CFA Exam Changes

All three CFA exam levels have been moved to computer-based testing (CBT). This change allows for a variety of benefits, like social distancing, more testing locations, and more certainty around planning for your exam.

The  exam curriculum has been slightly updated to reflect the following changes according to the CFA Institute:

• Environmental, social, and governance (ESG) coverage at Level I will cover the most recent developments and their impact on investment management.
• The Level I Quantitative Methods topic area was revised to be more engaging and digital-friendly and include code snippets as well as Excel commands to support data presentation.
• Transformed the Corporate Finance topic area into the Corporate Issuers topic area at Levels I and II.
• Fixed Income readings were revised across all levels.
• The Alternative Investments readings have been updated to include new introductory reading and a new reading on real estate at Level II.

Level I New Readings:

• Introduction to Linear Regression (Reading 7)
• Capital Structure (Reading 31) (Revised and moved from Level 2)
• Ethics Applications (Reading 60)

Level I Revised & Updated Readings:

• Probability Concepts (Reading 3)
• Common Probability Distributions (Reading 4)
• Sampling and Estimation (Reading 5)
• Hypothesis Testing (Reading 6)
• Aggregate Output, Prices, and Economic Growth (Reading 10)
• Understanding Business Cycles (Reading 11)
• Non-Current (Long-Term) Liabilities (Reading 24)
• Introduction to Corporate Governance and Other ESG Considerations (Reading 27)
• Uses of Capital (Reading 28)
• Sources of Capital (Reading 29)
• Cost of Capital-Foundational Topics (Reading 30)
• Capital Structure (Reading 31)
• Introduction to Industry and Company Analysis (Reading 37)
• Fixed-Income Securities: Defining Elements (Reading 39)
• Fixed-Income Markets: Issuance, Trading, and Funding (Reading 40)
• Introduction to Fixed-Income Valuation (Reading 41)
• Introduction to Asset-Backed Securities (Reading 42)
• Understanding Fixed-Income Risk and Return (Reading 43)
• Fundamentals of Credit Analysis (Reading 44)
• Introduction to Alternative Investments (Reading 47)
• Basics of Portfolio Planning and Construction (Reading 51)
• The Behavioral Biases of Individuals (Reading 52)

Level I End of Reading Questions Added:

• The Behavioral Biases of Individuals (Reading 52)

*The curriculum information is subject to change with each passing year.

Level II and Level III exams will be offered twice a year—the Level II exam will be offered in August and November. According to the CFA Institute, the following curriculum changes have been made to Level II:

• Machine Learning has been updated to apply several data cases to investment problems.
• A new Backtesting & Simulation reading has been added to explain how these tools are used in evaluating investment strategies.
• Transformed the Corporate Finance topic area into the Corporate Issuers topic area at Levels I and II.
• Fixed Income readings were revised to include notation simplification and alignment, elimination of duplication, and updating of concepts such as LIBOR to Market Reference Rates.
• The Alternative Investments include a single reading on Real Estate.

Level II Moved Readings:

• Backtesting & Simulation moved from Quantitative Methods (Reading 41)

Level II Combined Readings:

• Real Estate Investments (Reading 35) is now combined with the previous Real Estate Investments (V6R39) and Publicly Traded Real Estate Securities (V6R40)

Level II Revised Readings:

• Multiple Regression (Reading 2)
• Machine Learning (Reading 4)
• Environmental, Social, and Governance (ESG) Considerations in Investment Analysis (Reading 17)
• The Term Structure and Interest Rate Dynamics (Reading 28)
• The Arbitrage-Free Valuation Framework (Reading 29)
• Valuation and Analysis of Bonds with Embedded Options (Reading 30)
• Credit Analysis Models (Reading 31)
• Credit Default Swaps (Reading 32)
• Exchange Traded Funds: Mechanics and Applications (Reading 38)
• Using Multifactor Models (Reading 39)
• Application of the Code and Standards: Level II (Reading 47)

Level II End of Reading Questions Added:

• Return Concepts (Reading 21)
• Private Company Valuation (Reading 27)

*The curriculum information is subject to change with each passing year.

Level II and Level III exams will be offered twice a year—the Level III exam will be offered in May and August. Level III has updated the following:

• The Behavioral Finance subject has updated the behavioral biases reading.
• The Private Wealth subject has added additional private wealth management readings.
• The Trading and Performance Evaluation subject has added an additional reading in risk management.

Level III New Readings:

• Case Study in Risk Management: Institutional (Reading 30)

Level III Dropped Readings:

• Professionalism in the Investment Industry

Level III Revised Readings:

• Overview of Fixed-Income Portfolio Management (Reading 11)
• Liability-Driven and Index-Based Strategies (Reading 12)
• Yield Curve Strategies (Reading 13)
• Fixed-Income Active Management: Credit Strategies (Reading 14)
• Case Study in Portfolio Management: Institutional (Reading 28)

Level III End of Reading Questions Added:

• Options Strategies (Reading 8)
• Swaps, Forwards, and Futures Strategies (Reading 9)
• Active Equity Investing: Strategies (Reading 17)
• Hedge Fund Strategies (Reading 19)
• Case Study in Risk Management: Private Wealth (Reading 29)

*The curriculum information is subject to change with each passing year.