A Thin Three

So the day after I found out I passed CFA Level 2, I signed up for the Level 3 exam. Unlike in previous years, you now have the option of getting the volumes in electronic format in addition to, or instead of, the normal paper study guides. I chose the paper with the thought that I might want to pull them off the shelf and refer to them in future years, long after digital formats may have changed.

The 6 volumes arrived about a week ago but I’ve yet to crack any of them open. Here’s why:

Do you see above how thin the set of six are versus the previous levels? Do you see how nonchalant I look below?

Heck, the Schweser abbreviated notes may not be much thicker than a MacBook Air!

Yes, the result is that I wasn’t hit with the usual I’D BETTER START NOW impulse from previous years. In fact, before unpacking the box I thought they might have only sent the first 4 volumes with the rest to come in a later shipment.

Oddly, this year there was nothing in the box besides the study guides. No brochure on how to use the online candidate preparation tools – not even any of the usual postcards to send to Mom to explain why you’ve been too busy to call.

You try not to let it, but your mind connects the dots as maybe Level 3 isn’t so hard, hence the thin volumes, lack of postcards, etc. No tearing rush here…

One exciting aspect to Level III is that the titles of the volumes are quite a bit different. We have:

Vol 1: Ethical & Professional Standards (no quant ๐Ÿ™ )
Vol 2: Behavioral Finance, Individual Investors, & Institutional Investors
Vol 3: Capital Market Expectations, Market Valuation, & Asset Allocation
Vol 4: Fixed Income & Equity Portfolio Management
Vol 5: Alternative Investments, Risk Management, & Application of Derivatives
Vol 6: Portfolio: Execution, Evaluation, Attribution, & Global Performance Standards

Good stuff indeed. And the grand total comes out to be about 2500 pages. So if the Be Afraid Feeling doesn’t show itself within a day or two, I’ll see what I can do to artificially cultivate it.

Comments always welcome. On y va, niveau trois.

Update: I finally passed all the CFA exams and wrote an eBook about the program. If you’re interested, click here.

21 thoughts on “A Thin Three”

  1. I failed Level III the first time I took it. Not sure what the pass rates are now, but Level III had the lowest pass rates of the 3 levels at the time I finally passed. Be afraid. Be very afraid. (Just kidding, but don’t let thin study guides fool you.)

  2. I’ve managed to finally log my first couple of study hours. The readings on behavioral finance are are fresh & interesting. Thanks for the punch in the arm! Needed it!

  3. You may have come across this already, but if you like the Behavioural Finance stuff you should read the books by James Montier, his little book on behavioural investing is a great introduction to the frailties of the human mind when it comes to investing.

  4. Lumi: none too happy to report I failed Level III this time around.

    Ah well, I’ll get back up on that horse soon I’m sure. My takeaways this time around were –
    *I could’ve started earlier (started in January since tried to prolong studying as long as I could; wish I started in November looking back on things)
    * I am planning to spend ALOT more time doing old CFAI practice tests, not just Schweser practice tests.

    I am very up in the air on if I will re-take right away or wait a bit. Just don’t let those thin volumes fool you, that’s what I would say!


  5. I started level 3 the same way I started level 2 — in October the year before the exam. Why? I kept flashing back to that PowerBar don’t bonk commercial. You know the in which swelling orchestral music played in the background as the camera closed in on the agonized face of a long-distance runner miles past the wall but close enough taste victory. In the distance, you could see the out-of-focus shape of the next runner rounding the final corner. As the camera flashed past the crowd caught up in the shared elation of the runners and the moment, the lead runner triumphantly raced across the line only to be bounced back by the finishing tape because he had completely exhausted himself. Then the tag line Don’t Bonk flashed on the screen as the next runner easily broke the tape. That’s how I felt about level 3. I was so close that I certainly wasn’t going to let some little lapse of concentration or mishap stop me. Funny I thought that because 3 weeks for the exam, I lost my footing stepping out of the bath tub and almost knocked my head on the toilet. As I slid across the floor on my back, all I could think of was, “Protect your head!”

  6. I started studying for level 3 in mid December. Kept building momentum slowly, and felt my preparation this time was much better than level 2 which I passed first attempt (had started studying in early feb and was cramped with work). I knew I was very close to the finish line, too, and didn’t want to take it lightly–given the warnings about how deceptively simple it was. I thoroughly revised the content a few times, put in ample time preparing, solved practice questions as well as past papers which seemed a breeze both in terms of difficulty and I had ample time left even after finishing the paper.

    I realized that I did not enjoy the content in level 3 prep because I couldn’t apply bulk of it to my current field (i-banking) as much as levels 1 and 2.

    When I started the paper (morning-essay section), it seemed very difficult. I got stuck on the first question, panicked and the time kept running out. Before long I was gasping for breathe and knew there was no way I would pass. Other than 2-3 questions, every question seemed too tricky and confusing. Even while I was solving the paper, I knew that even if I had studied 2 more months, I would not have been able to perform any better. I couldn’t complete the paper–left 2 questions with highest points– almost blank as I ran out of time.
    I knew my only chance was to score almost 100% on afternoon session, if at all. So I mustered up courage and did my best. It seemed fairly simple and I was sure I had scored in 90s. That made me hope for a miracle. But it didn’t happen.
    Now I have to start all over again but have no clue where exactly I missed the point in my prep given how seriously I took it. Or may be I didn’t.

  7. Anon – thanks for the tip. Love the behavioural stuff and have never heard of Montier.

    Bob – sorry to hear of your results. Thanks for the hints and I say get back on the horse RIGHT NOW so that you can get this CFA thing over with and go back to having a normal life!

    PCWei – Great tips and story from a demigod who’s passed all 3 exams. We’re not worthy!

    Disappointed – being able to apply the material makes a big difference doesn’t it? Sorry to hear you got held back. You’ve made it further than me so I’m not one to give you tips, but I just say to get out the checkbook, order the max package from Schweser, and start today. The higher up we get, the more mutant DNA brainiacs we have as peer test-takers. Let’s show ’em who’s boss this time around.

    – lumi

  8. Shiva – yes! An air of easy unconcern or indifference ๐Ÿ™‚

    Wenger – good to hear back from you. I always tend to start early but log very little average time per day. In the end I guess it’s all about the cumulative hours logged. October 1 has passed I presume you’ve cracked the books open. ๐Ÿ˜‰

  9. Hi

    Any thoughts on how to calculate back testing for historical prices ?
    any solutions much appreciated ….


  10. vivek,

    sorry, looks like I lost the breadcrumbs of an earlier conversation. What exactly are you looking for? Algorithms to try out on historical data? Previously I wasted a lot of time trying to develop a strategy using neural networks. Now I’m wasting time attempting the same with linear regression…


  11. Hey Guys!!! I have been a die hard fan of schweser notes for level 1 and 2. I didnt touch CFAI books for those levels and passed my exams one the first attemtempt with great marks. BUT I have heard that L3 is a diffrent ball game and CFAI books are better that Schweser notes. I would appreciate your comment(s). Please state your course of study (Schweser/CFAI/Both) , the number of attempts it took to pass L3 and any other thing which you may deem appropriate. Thanks and Good Luck to you All

  12. Just started January 9th for level 3. Yes, the books look thing in comparison to the past – which I prefer because i hate high volume exams. I dont expect this to be a cake walk either but I decided to shell out the extra $400 when the CAD was on par with the USD and purchase the instructional videos. I really don’t want to write this exam twice or worse… thrice.

    Good luck and please continue to post as your studying progresses

  13. Thanks for chiming in Vancouver. Being so close to the finish line it would indeed be a major downer to have to do a repeat. I have so many ideas for other things to do with my time. Good luck to you, keep in touch, and at minimum let us know how you performed!


  14. Hi, I am an undergrad at Maryland and am taking the Level 1 exam this June, so just starting to go through the pipeline. I’ve read through your blog and have found it very inspiring and helpful. I am a Finance, Accounting, and Econ triple major. I was wondering if you had any additional tips for studying especially because I’m still in school. I only have the CFA books and have been taking notes, reviewing, and doing the practice questions in the books. Would you recommend buying the practice tests the CFA offers? I really need to pass this June so that I will be looked at seriously.
    Also have you heard of the CAIA? What are your thoughts?

  15. Hey Lumi for level 1 is it enough to go through Schweser notes alone or need to go thru CFA text book? Throw me some light…Waiting for the same

    Close follower of ur blog….ATB for ur level 3 man….

  16. For Level 1 I only used CFAI b/c I was too cheap to buy Schweser. But as mentioned in another post, my modus operandi is to (a) take a Schweser practice test using the Qbank (b) find out where I’m performing the weakest (c) work a few problems from those chapters, particularly carbon copies of the type I missed and (d) go back to (a).

    Repeat again and again until exam day. Good luck Ghoutham – you can do it!

  17. Just found this blog on a random quest for study tips. I’m well into my 2011 Level 2 study prep, literally just watching videos, doing quesrons, mocks, brushing up on weak areas etc. This is my first attempt at L2, I have 2 weeks off work starting Thursday which is a blessing.

    Respect on retaking and passing, and good luck on L3!


  18. Wrote level three yesterday!

    I always thought that after the exam i would be happy and move on with life… Unfortunately, im cursed with replaying it in my head, fearing that i failed, and thinking about the pain of writing it next year. Blah

    Oh well, we will see…

    For the most part i found the morning fair but tough on time, the afternoon was harder…. At best i think i scored in the mid 60% range, let’s see if that is good enough.

    One thing i noticed about level 3 is that everyone that i spoke to seemed to
    be writing it again, coincides with the uber low pass rates.

    All the best, ill post again when the results come in!

  19. Hey can anyone email me the ebook of CFA level 3 pls… i will be gvng my first attempt so need guidance on the same….

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