CFA Level 1 vs. Level 2 vs. Level 3: Understanding the Exam Structure

The Chartered Financial Analyst (CFA) program is an internationally recognized qualification status for professionals in the finance industry. To earn a CFA charter, you must successfully pass three different exams: Level 1, Level 2, and Level 3.

Each level features exam content with its own structure and testing format. At Salt Solutions, we offer a range of comprehensive resource materials to help CFA candidates effectively prepare for each level of the CFA exams. These include the CFA Level 1 free trial, along with CFA Level 2 mock exams, and extensive CFA Level 3 exam prep resources.

Below, we cover the differences between the content and structure of the CFA Level 1, 2, and 3 exams so you have a better idea of what to expect on each exam day.

Our comprehensive resource materials help candidates effectively prepare for each level of the CFA exams.

CFA Level 1: Foundations of Finance

• Exam Structure: There are two sessions to the CFA level 1 exam. Each session lasts 2 hours and 15 minutes. The questions on the exam are multiple-choice – 240 of them divided between the morning and afternoon sessions.
• Content: The focus of the Level 1 exam is on the fundamentals of finance and ethics. Some of the topics covered include professional standards and ethics, financial analysis and reporting, economics, quantitative methods, equity investments, corporate finance, alternative investments, derivatives, portfolio management, fixed income, and wealth planning. At Salt Solutions, we offer CFA Level 1 free preparation resources for CFA Level I exam candidates.

CFA Level 2: Deep Dive into Asset Valuation

• Exam Structure: The CFA Level 2 exam features 120 items delivered in two sessions—morning and afternoon. The morning session features essay questions requiring a constructed response. The afternoon session includes item set questions, with similarities to case studies. The Level 2 exam is generally known for offering greater depth and complexity than Level 1.
• Content: This exam covers asset valuation to a deeper extent. It also requires the application of the concepts covered in Level 1. The topics of this exam include fixed-income securities, equity analysis, portfolio management, alternative investments, derivatives, wealth planning, and more. Utilizing CFA Level 2 mock exams can significantly help in Level II exam preparation.

By understanding what you will face at each exam level, you can apply the proper dedication in CFA preparation.

CFA Level 3: Management of Portfolios and Wealth Planning

• Exam Structure: The CFA Level 3 exam morning session focuses on wealth planning and portfolio management with constructed response essay questions. During the afternoon session, candidates encounter item set questions covering portfolio management and wealth planning, plus other pertinent topics.
• Content: The Level 3 exam focuses primarily on wealth planning and portfolio management. It emphasizes the application of previously learned investment concepts in the context of portfolio management, and it also evaluates professional and ethical standards involving client portfolio management.

Understanding the differences in content and structure between CFA Level 1, CFA Level 2, and CFA Level 3 is vital for effective planning and preparation. Candidates need to adjust their study process in accordance with the unique challenges offered by each exam level. By understanding what you will face at each exam level, you can apply the proper dedication in preparation to make it through the CFA program and eventually earn the prestigious financial achievement of a CFA charter!

For questions about our top-notch CFA study materials and the exceptional exam preparation experience we have created for candidates, please contact our team.