TOP 10

TIPS TO
PASS!

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How to Pass the Level II CFA® Exam

How Level II is Different from Level I and Top Ten Tips to Pass
by Daren E. Miller, CFA, Wiley instructor for CFA® Exam Review

Saturday, June 6, 1998 was the day that I wrote the most challenging exam of my life: Level II of the
CFA® Program. It wasn’t the most complex exam, but it was the most stressful. I can still remember
trying to control the pen in my shaking right hand as soon as I flipped open the morning session’s
examination book. Instead of trying to breathe deeply to calm down (I know this powerful technique
now) I grabbed my sweaty right hand with my weaker left hand to maintain my composure. It took
many more anxious minutes before I was able to get into the exam “groove”, although I certainly was
not fully confident. Thankfully, I not only completed the exam but also passed Level II on the first
attempt. The Level II pass is my greatest test win.

Almost 18 years later after that memorable day, Level II remains as much as a challenge for today’s
CFA® candidates as it did for me in the late 1990s. As a CFA® instructor, I have worked with many Level II
candidates to help them avoid getting stuck on the Level II “merry-go-round” of multiple retakes.
Looking back, a lot of my stress at Level II was a direct result of my Level I experience. I have learnt that
preparing for Level II is different than preparing for Level I.

2. Don’t over-concentrate on high-weight topics.

Three topic areas alone at Level II represent
between 40% and 65% of the exam weight: Financial
Reporting and Analysis (FRA), Equity Investments,
and Fixed Income. While passing these topics is
important, it is impossible to pass the rest of the
exam without mastering some of the remaining
topics, such as Ethics and Professional Standards (10
to 15%). The remaining six topics have weight range
with a minimum of 5%, which is why I believe that
candidates tend to overlook them.

3. Develop your concentration skills.

Here are ten ways in which the
Level II exam is different from Level I
and tips for succeeding at Level II.
1. Don’t rest on your Level I pass.
Many Level II candidates approach the exam with
hubris and a false sense of security simply because of
the elation of passing Level I. But, the time to celebrate
passing Level I has come and gone. Believe that you
are now approaching a brand new exam that will have
little relation to what you have already learned.
Item sets require more concentration. Level I
questions are stand-alone multiple choice questions
(MCQs) with a planned completion time of 90
seconds per MCQ. At Level II, the testing format is
more challenging. The item set consists of a multi-
page vignette (or mini-case study) followed by six
MCQs that require information from the vignette.
Each item set of six MCQs now require a time budget
of 18 minutes to complete, which requires more
concentration and the ability to recall relevant parts
from the vignette.
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CFA® Exam Review
4. Practice, Practice, Practice.
At Level II, there are fewer practice questions.
Successful Level I candidates might have worked
through through thousands of practice MCQs and
as many as ten mock exams to practice for the real
exam. At Level II, there is a smaller supply of high-
quality practice item sets. And even by practising
with a comparatively small sample, the real exam
will look almost nothing like the practice item sets
as the examiners use their imagination to conjure
unexpected vignettes. Make sure you get access
to high quality Level II practice questions and take
at least two Level II Mock Exams. Wiley’s practice
questions and Mock Exams will get you close to
what you will see on exam day, so get early access to
prepare yourself.
5. Know Your Weaknesses from Level I.
Weak Level I topics are revealed. Many of the Level
II topics build on your knowledge from Level I.
So if you were weak in Level I hypothesis testing
(or skipped it altogether), then you will find
Quantitative Methods much more difficult at Level
II. Weak areas or skipping topics outright will come
back to haunt you later.
6. Get Expert Help.
At Level II the readings are more technically
demanding. For many Level I candidates, a
generalist undergraduate business degree gives
you a head start at Level I. However, many Level
II readings contain obscure subjects that you
have never heard about, such as the accounting
treatment of multinational operations. Many Level
II readings are dense and tougher to get through
compared with Level I. So invest in a Course or Test
Prep materials from a CFA Institute Recognised
Provider like Wiley with access to Online Live Weekly
Virtual Classes with Q&A, Online Mentoring, Study
Guides, 110+ Hours of Recorded Lecture Videos from
expert CFA instructors and more – it could save you
time and and a great deal of heartache in the long
run.
7. Don’t Skip Readings or Take Risks
At Level I, the entire CFA exam consists of 240 MCQs
which can come from almost 60 readings, which
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corresponds to an average of 3 MCQs per reading on
average. So, if you skip a reading or two, chances
are that it won’t matter too much. At Level II, there
are only 20 item sets across almost 60 readings, so
there is a lot more uncertainty about what will be
tested. If you skip a reading and it shows up on the
Level II exam as an item set, then you stand to lose
5% of the exam.
8. Manage your Stress.
The post-exam waiting game is more stressful.
At Level I, many candidates walk away from the
exam centre rightly believing that they have passed.
At Level II, most candidates walk away not knowing
how they have performed and are surprised by
unexpected item sets. This makes the nearly
two-month wait to exam day a stressful and anxious
time. (Looking back 18 years ago, it certainly was
for me.)
9. Be Determined to Re-Take with a Plan that Fits
Your Schedule.
By being in the middle level of the CFA Program,
most candidates are more determined to complete
than at Level I. So, they will stick with the exam,
even if it does not fit into their lives for the time
being. For example, I know of candidates who
married a few months before the June exam. They
prepared well before the nuptials only to stop after
the ceremonies. They may or may not show up on
exam day. Of course, focusing on settling down with
a new spouse is the right thing to do and ought to
be a higher priority than the CFA® exam. However,
the best course of action would have been to
prepare for Level II in a different year. And because
there is only one sitting of the Level II exam each
year (there are two for Level I) candidates can be
impatient because they do not want to wait a full
year. To increase your chances of passing, make sure
you get a realistic plan that fits around your busy
work and life schedule and use an adaptive Exam
Planner (like the one from Wiley) to make sure you
stay on track. And if your circumstances change,
be flexible – Wiley’s Pay Once Promise means you
have access to your course until you pass, so if you
need to defer you’ll continue to get access with all
upgrades and updates until you pass.
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CFA® Exam Review efficientlearning.com/cfa

10.  Build on your Experience and Know How to 
Pass the Level II Exam.
At Level II, you are at least one year older. The ability
to study gets more difficult as you get older because
life becomes richer and more complicated. Many
Level I candidates are fresh out of university and
Smarter Test Prep
are looking for that first exciting job. With a new job
comes the need to impress at work. There might www.EfficientLearning.com/CFA
be a lot of exhausting business travel, too. New
personal relationships may form -- or old ones may Sign up
break down. With more potential distractions comes for your
more reasons not to hit the CFA® books. Free Trial
today
While being older and more experienced, you would
think that this would translate into a significant
higher rate of exam success at Level II compared
with Level I. However, in recent years the percentage
of candidates passing Level II is only marginally
higher (by no more than 5 percentage points) than
Level I. However, by adjusting your study technique
and learning how to approach the Level II, you too
can be successful.
The secret is out.
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