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CFA Level 3 Topic and Reading Weights and Importance



CFA Level 3 Topic and Reading Weights and Importance

This is a quick post that highlights previous exam weightings, then looks at the number of LOS and pages devoted to each major section, before giving our best guess at which individual readings are most important and where on the exam they are most likely to appear.

 

While official topic weightings have been removed from L3 since 2015, it is still instructive to look at how the old weightings compared to L1 and L2.

We can also get a better sense of how much of the underlying curriculum is devoted to each topic area Nothing revolutionary here, but you should see what has been most emphasized (note this reflects 2016; while some of the material has shifted this is still a relevant guideline):

CFA L3 2016 – Reading Weights & Relative Importance (by www.gostudy.io)

Study Session

CFA Reading

Relative Importance

Estimated Weight

Notes

1

1/2 - Ethics

Very High

10-15%

Weighting increased in 2015, likely to be afternoon item set

2

3-Ethics case study

Low

4-Ethics case study

Low

5-Asset Mgr code

Low-Medium

3

6-Behavioral Finance

Very High

5-10%

Common in morning constructed response. ID/explain/justify

7-Behavioral biases

High

8-Classifying investors

Medium

4

9-Individual IPS

Very High

10-20%

Always IPS in morning, followed by selecting portfolio based on SAA. Concentrated position is newly emphasized.

10-Taxes

Low-Moderate

11-Estate Planning

Moderate-High

5

12-Concentrated Position

High (new reading)

13-Human Capital/FC

Low-Mediu

6

14-Institutional IPS

Very High

10-15%

Always Institutional IPS in morning highlighting at least 1 type of institution

15-Pension ALM

Moderate

7

16-CME

Moderate-High

5%+

Small part of AM structured response question or as part of an item set

17-Macro/Valuation

High

8

18-SAA

Medium-High

5%

Likely small part of large structured response question or as part of an item set

9

19-Currencies

Moderate

5-10%

20-Benchmarks

Moderate-High

10

21-Fixed Income

Low

10%

Likely to be tested in morning while selecting an appropriate portfolio

22-Bond evaluation

Very High

11

23-Bond portfolio mgmnt

Very High

5-10%

Can come up in either morning or afternoon

12

24-Equity Portfolio Mgmnt

High

5%

Usually in afternoon item set but can come up in AM

13

25-Alternative investments

Medium

5%

Alternatives usually tested in afternoon

14

26-Portfolio Risk mgmnt

Very High

5%

Usually part of structured response in AM but could show up in afternoon

15

27-Risk Mgmnt with Derivatives

Very High

5-15%

Likely to be an entire afternoon item set. Emphasis on reducing risk by using derivatives. Futures are most important

28-Options

Low

29-Swaps

Medium-Low

16

30-Trading & Execution

Very High

5-15%

Usually in the morning, but has shown up in the afternoon as well

31-Portfolio Monitoring/Rebalancing

High

17

32-Performance Evaluation

Very High

5%

Often structured response in AM. Compare/contrast rebalancing strategies

18

33-GIPS

Medium

5%

Usually in afternoon

Prepared by www.gostudy.io  All of the above reflects estimates only

You can check out more about the structure of the CFA L3 exam here: https://gostudy.io/blog/Structure-of-the-Morning-Essay-on-CFA-L3