Thoughts on Passing the CFA® Exam from a Non-Finance Type


My background may differ from many candidates, in that although I work at an asset management firm, I work in a legal-compliance role. Even though I do not participate in core investment analysis for my firm, pursuing the CFA charter has been invaluable to me in terms of having the proper context to give guidance. I would highly recommend getting this education for any in similar roles, and I am certain that your employers will appreciate having legal-compliance types with as much investment knowledge as possible to provide appropriately tailored advice, policies, and procedures. The good news for readers is that if I can pass with my background, so can you. I was at a distinct disadvantage to many of my test-taking peers, who would have been actively involved in some part of the investment process at their firms.

Remember What You Can

When I think about what makes the CFA exam so difficult to pass, it has to be the sheer scope and diversity of subject matter. It’s really important to pre-digest the information you are trying to memorize into bite-size bits. (In fact, I remember learning in a biology class in college that, at any moment in time, the human brain can only process the amount of information contained in a single complex Chinese character.) In this, I think my law school background gives me an advantage, because the entire focus of a first-year law student is learning to reduce reams of material across many different cases in multiple areas of law to a logical progression of blurbs in an outline. No matter how complex an opinion is written or how flowery the prose, it ends up being a single line item in your outline.

Similarly, for CFA candidates struggling to gain complete mastery of the wide variety of topics, I think it’s extremely important to create a skeletal outline with reference to the core formulas in question, reducing all the writing about a topic to a handful of bullet points, even if you have an incomplete understanding of nuances of the topic as a whole. There are sometimes only a handful of ways to ask questions about a topic, especially with the first two levels; even so, you have to really avoid looking at each individual tree in the forest. Creating a bare-bones outline also really enables your brain to pick up patterns in the flow of topics at the highest level, which then enables you to pick up details really quickly in future levels because you have a skeleton on which to build. Further, the very process of outlining aids in committing things to memory. It’s a much more active manner of learning. This approach sounds obvious, but I do see a lot of students overlooking how effective and simple it is.

The other way the outline approach can pay dividends is with respect to the essay questions. Having a concise outline per topic can add the readymade framework for such answers, with the exam taker’s goal being to tie the facts and circumstances of each question to the framework to get as much credit as possible (even if portions of the analysis ultimately prove incorrect). These suggestions are not to de-emphasize the nuts and bolts of review and practice test taking, but I think the outline approach is an indispensable tool to make review more efficient and memorization simpler.

Forget What You Know

The last thing I would say is that regardless of whether you pass or fail, or however many times it takes you to pass, studying for the CFA exams has tremendous value in its own right. Having been an economics major, I can state without hesitation that the education I received from all that CFA test preparation far exceeded the knowledge I gleaned from my degree. This is true even if you are pretty contrarian and do not believe in some of the theories that form the basis for the curriculum. It’s important to be aware of the conventional wisdom used in investing disciplines. This leads to an important test-taking tip: Check your beliefs and convictions at the door if your goal is to pass. You are trying to learn the material as presented. Career-wise, I would then do the opposite and question everything you have ever learned, continuously!

Good luck!

About the Author

Samuel Kim, CFA, majored in Economics at Harvard University and received his juris doctorate degree from Columbia Law School. Samuel worked as a corporate attorney at Cravath, Swaine & Moore in New York and Davis Polk & Wardwell in Menlo Park, California, before moving in-house at his current firm, AXA Investment Managers, where he is the US Chief Legal Officer.




Samuel Kim