What Are the CFA Program Topic Areas?

Preparing for the Chartered Financial Analyst examinations takes time and dedication, but the benefits of holding the CFA charter are numerous and include both career advancement and transition into the global asset management industry. The purpose of the Program is to allow financial professional and aspiring financial professionals to demonstrate that they have mastered a comprehensive state-of-the-art body of investment knowledge through a series of examination questions covering ten topic areas.

The Chartered Financial Analyst Examination

The CFA Institute

CFA Institute is a global investment management education and membership association with over 100,000 members and offices throughout the world. The organization is best known for developing and administering the renowned Chartered Financial Analyst Program, recognized as the global gold standard among investment credentials. CFA Institute has members in 139 countries and more than 130 member societies in 58 countries. The mission of the organization is to lead the investment profession globally by promoting the highest standards of ethics, education, and professional excellence for the ultimate benefit of society.

The CFA Program

The CFA Program consists of three Levels, which are completed sequentially. Each Level has an individual comprehensive exam which covers all of the topic areas. Each examination lasts six hours; three hours in the morning and three in the afternoon, with a two-hour lunch break in between. The success rates vary annually. The passing rates for the 2012 exams were 38% for Level I, 42% for Level 2, and 52% for Level 3, respectively. While successful completion of all three examinations is required to ultimately earn the charter, unsuccessful candidates are allowed to retake examinations without penalty. The exams are rigorous. CFA Institute indicates that successful candidates study, on average, a minimum of 250 hours.

The CFA Program is progressive – the knowledge gained at Level I is used at Level II and the knowledge gained at Level II is used at Level III. Level I focuses on investment tools. Level II has an asset valuation focus. Level III is primarily concerned with portfolio management.

Exam Topic Areas

The CFA exam covers the CFA Program Body of Knowledge – a broad range of financial knowledge for the investment generalist consisting of ten topic area:

  • Ethics and Professional Standards
  • Quantitative Methods
  • Economics
  • Financial Reporting and Analysis
  • Corporate Finance
  • Portfolio Management
  • Equity Analysis
  • Fixed Income Analysis
  • Analysis of Derivative Securities
  • Alternative Investments
  • Portfolio Management and Performance Presentation

Level I

The first level of the exam consists of 240 independent multiple choice questions grouped by broad topic area. Each question on the exam carries the same weight and there is no penalty for guessing. The Level I exam is offered in December and June.

Level II

The Level II exam consists of 20 question sets (ten in the morning and ten in the afternoon). Each of the 20 question sets (or item sets) contains a “mini-case.” Specifically, an item set consists of a vignette (or short case) and six multiple choice items pertaining to the facts presented in the case. Each vignette is one to two-and-a-half pages long, and often includes charts and tables of information. The Level II exam focuses primarily on asset evaluation and is offered only in June.

Level III

Level III of the CFA exam includes both essay (and constructed response) questions as well as item sets identical in format to those at Level II. The morning session is the essay portion and the afternoon section is entirely item sets. The Level III examination is only offered in June.

The Master of Investment Management and Financial Analysis offered at Creighton University online is a high-quality, practitioner-oriented master's degree program in finance that provides the extensive knowledge required of savvy investment professionals. This degree program uses the same curriculum that is the foundation for the CFA Program.