Sunday, November 13, 2011

Test taking Strategy for CFA (June 2012 CFA Level 1 strategy: results and analysis)

Strategies and Game plans for taking the exam (personal opinion, apply at your own risk)

June 2012 CFA Level 1 strategy:
  1. Starting with Financial Statement Analysis & Economics (Scz + Core readings 15*2 hours)
  2. Then corporate Finance (Scz + Core readings 10 hours)
  3. Alternative Assets (Scz + Core readings 8 hours)
  4. Derivatives+Fixed Income+Quant+Portfolio are in FRM (hence can be diluted)
Feb 2012: Economics / FSA / Alternative assets
March 2012: Corporate / Portfolio
April 2012: Quantitative / Derivatives / Fixed income
May 2012: Other exams

June 3 2012 Exam

Introduction: Often it is said that Election are won not by performance and good governance but by good political management. Similarly exams are cracked not just by hard studies but exam management that includes time management, psychological management, other soft issues. Hence sooner or later one finds his way by his own ways of playing.

Proposed order of Attempting:
  1. Ethics (2 min / question)
  2. Eco
  3. FSA
  4. Equity
  5. Derivatives and Alternative Income
  6. Corporate Finance
  7. Fixed income
  8. Quantitative Analysis (1 min per question)
Other important issues to take care of:
  • The reason to attempt questions in this order is that Ethics is v imp to pass the exam, and eco is something that I am new to. FSA being the longest section and again new to me goes at No.3. Finally Quant and related subjects are moved to end as I can do them with less energy and can do them in short time.
  • I am thinking to follow this or just the reverse, but the problem is that in the last 30 minutes mind become drained and I cannot focus on tough and long questions of Ethics and FSA, hence to do the tough first and easy at the last.
  • A point to note here is that we don't need an overall good score, rather we need to have 70% accuracy in the exam in all subjects. Where the key to pass is do good in ethics & FSA (ignoring quant as it is easy for me).
  • Also the questions which you have reduced to 50-50, should be marked so that in the end you can pick between the 2. It is good to keep them in record. Also marking questions properly as sometimes the line on a/b/c is not good to make a distinction. 
  • If you don't practice even questions you know will take more time.
  • Fear and Negativity should not slow you down in the exam. These are psychological barriers.
  • Hence one needs to break down exams into time bound games and have a strategy on sequencing. 
  • Reading LOS and thinking we know it might be a good idea as questions are directly made form them.  Questions are directly made from a statement of LOS that find this thing, no indirect or tricks involved.
  • Least likely catch and reading errors killed me. 
  • Petty terms like Payback period, profitability index (of Corporate Finance) can create trouble, although they are very easy but you need a good memory. Same happens in economics with laffar curve, etc 
  • It is a lot about Data interpretations as redundant values are given with lots of junk data.
Read the F Question:
Cash is real cash in CFs
Go long, means do it on paper
(A post on this topic exist: Check the list)

Last 15 days strategy:
  1. Read each LOS carefully and read it from Scz as questions are directly picked from there.
  2. Old CFA mock for years 2011,2011,2009 and also the free paid mock at the CFA website.
    Beside this you can check the mock of Scz.
Common things:
  • If we are given NI and elements then we must remove the effects
  • Reference word is important
  • Interest expense in the bond questions need to be done with common sense
  • The wordings are very important
    List of silly mistakes. There are list of silly mistakes available on internet which you can see my list goes as follows:
    Warrants are not to be added but the different amount causes dilutions.


    Conclusion: Finally decide on a plan that suites you well. Be positive and practice to tame your mind.\

    25 Days before the Exam


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