A Mindset for Success in the CFA Exams

I’d like to share some mindset hacks helpful in passing the CFA exams, along with some pointers on how to approach this daunting and rewarding experience. As a charterholder myself,  I’ve had the privilege of mentoring candidates through all three levels, and I hope this helps you in your studies.

A Test of Commitment

Let’s start with understanding the answer to a burning question: “Why are the pass rates so low?” 

To me, there are several factors in play, but first and foremost, I think the Institute is testing the commitment of the candidate. I do not think it’s because the exams themselves are excessively challenging to those who are willing to pay the price. The exams are indeed very challenging, but successful candidates tend to have a “whatever it takes” attitude and relish the opportunity to partake in that challenge.  

This is the most important mind hack: to believe that passing the exam is a decision you make at the beginning of study, not an event. This might be true, it might be untrue, but that isn’t the point. By thinking in these terms, you can begin to see what must be done to realize that decision so you can then execute on the plan to do so, course-correct along the way, and wind up fully prepared for the big day.

Staying Humble

When it comes to the real challenge of the exams, the biggest mistake that can be made is to underestimate your competition. I doubt that anyone puts good money on the table to commit to a grueling study plan over four to six months without having some sense that he or she has an edge. Yet you will see overconfidence in some candidates—a sense of entitlement that can come from many places.  

Did you attend a top finance program? Work in the asset management or investment banking industries? Perhaps you have been very successful with investing and finance. Guess what? Pretty much the vast majority of your peers studying for any level have an advantage like one (or more) of these.  

Remembering this fact will help you to remain humble, and this is important, because learning requires the ability for an individual to see his or her own shortcomings. From this vantage point, it becomes simple: either you are excellent at solving a certain type of problem or you are not.

Relentless Execution

This brings us to the next point: the work isn’t going to do itself, and chances are, you’re already very busy. The Institute tells us that successful candidates spend an average of 300 hours studying for each level. That means that if you’re starting six months before the exam, a rough target would be 12.5 hours per week of study—but don’t assume 300 hours is enough for you personally. Some candidates are more ambitious (or nervous) and study for 20-plus hours per week.  

I recommend actually putting appointments on your calendar and being relentless about execution. The mindset here is to firmly decide to do what it takes, when it is required; to not put off the work for any reason. There will always be some distraction, and you must find a way to remember why you are subjecting yourself to this ordeal and stay strong and on-task.

Practice Makes Perfect

In studying, it is useful to remember that there is reading the curriculum and then there is what the test actually wants you to prove you can accomplish. These are radically different things.  

So we come to what I view as a critical mind hack, treating the test like a boxer trains for a fight, or the way a football team trains for tough game. Reading the material is the foundation of this training, but it’s eclipsed in importance by actually working practice problems. When you find weak areas, you work more problems, and it’s actually helpful to work the same problems over and over.  

Of course, just solving problems is not enough. You also have to read the rationales to discover why you missed a certain question—or why you got one correct. You don’t want to be practicing getting a correct answer the wrong way!  Also, you want to think about how each particular question could be changed or asked another way, because there are only so many ways the Institute can test a topic.  

Then follow all of this work up during the last month by taking full practice exams. Some practice exams are excellent representations of what you will see when it counts and others are not, but that isn’t where the value lies. The true value of all this practice is in repetitions and variety. If you practice this way, when the Institute throws a curveball, you’ve already dealt with it (or one of its close analogues) and will be able see the correct answer.

Refresh to Excel

Sharing one last mind hack, I recommend taking a day or two off of both work and studying going into the first Saturday of June or December. Go to a hotel near the testing site where you won’t be disturbed and do absolutely nothing related to the exam. Swim, rest, enjoy good food, and get recharged. By the time you’ve arrived at this point, you’ve already passed or not—what happens on exam day is a function of many hours of work over a long period, not what happens in the final day or two. Walk in calm and confident, not because you think you’re better than the competition, but because you know you gave it your all and are relaxed.  

I hope you find these pointers useful, and I wish you luck on exam day!

About the Author

Peter Baksh is a CFA charterholder and currently serves as chief investment officer for the trust department at the First National Bank of Mount Dora, which manages approximately $1/2 billion in discretionary assets across all asset classes for private clients and institutions. He has been an active member of the award-winning CFA Society of Orlando, where he’s held various executive roles. A graduate of the University of Florida, Peter is now in the MBA program at Indiana University’s Kelley School of Business, pursuing his passion for lifelong learning.

Connect with Peter via LinkedIn at https://www.linkedin.com/in/petebaksh/

Peter Baksh