What Is the Format of the CFA Level 2 Exam, and How Is It Different from Level 1?
Discover the unique structure and advanced content of the CFA Level II exam compared to Level I, including detailed breakdowns and preparation tips.
Preparing for the Chartered Financial Analyst (CFA) exams requires you to understand the intricate details of each level's format. The CFA Level II exam is a significant milestone, the second step in your journey, and it's distinguished by its unique structure and content.
At Salt Solutions, we offer an array of resources to help you study effectively for the CFA exams, including CFA Level 1 mock exams, Level 2 mock exams, and other powerful tools. Let's explore the specifics of the CFA Level II exam and explain how it differs from Level I.
The Level II exam allows slightly less time to complete, highlighting the need to practice with mock exams.
An Overview of the CFA Level II Exam
First off, the Level II exam lasts for 4 hours and 24 minutes, split into two equal sessions of 2 hours and 12 minutes, with an optional break in between. During this time, you'll tackle 22 item sets, each presenting a scenario with vignettes and accompanied by a total of 88 multiple-choice questions.
On the other hand, the Level I exam is 4 hours and 30 minutes long, also divided into two sessions, but it features a total of 180 multiple-choice questions.
The Item Set Format
Unlike Level I, where questions are independent, Level II uses item sets. Each set has 4–6 multiple-choice questions based on a common vignette, which is like a mini case study with tables, text, and financial statements to mimic real-world scenarios. You'll need to dig through the vignette to find the relevant data for your answers.
Time Management Considerations
The Level II exam gives you a bit less time to finish compared to Level I, so it's really important to practice with mock exams for CFA Level 2. You'll need to be careful with your time management to make sure you can answer all the questions thoroughly within the given timeframe.
In Level II, you must sift through vignettes to extract pertinent data for accurate responses.
Complexity and Conceptual Understanding
Level II goes beyond the basics covered in Level I, diving into more complex topics like CDS valuation, swap valuation, and derivatives pricing models like Black–Scholes–Merton. While Level I focuses on memorizing concepts and metrics, Level II requires you to have a deeper understanding and the ability to apply tools to value assets and analyze financial data.
Increased Question Difficulty
The questions in the Level II exam are tougher, requiring you to focus more and be highly proficient. Each topic is examined in greater detail, challenging you to navigate complex scenarios and apply your knowledge effectively and accurately.
Different Emphasis on Ethics and Standards
While Ethics is important in both levels, Level II presents ethical dilemmas in a more nuanced and challenging way. You'll need to show not only your familiarity with the CFA Institute Code of Ethics and Standards but also your ability to navigate ethical complexities with precision.
The difficulty of exam questions escalates at Level II, demanding heightened concentration and proficiency from candidates
How Salt Solutions Can Help
Preparing for the CFA Level II exam requires comprehensive preparation and access to the best study materials. At Salt Solutions, we offer highly effective resources, including mock CFA Level 1 exams and mock exams for CFA Level 2, to bolster your exam readiness and confidence. Start your CFA exam preparation and sign up for a free trial today.