The Level III CFA® Examination
The Level III CFA® Exam is an in-depth review of the entire portfolio management process, and requires that you demonstrate a working knowledge of the process, including the application of concepts learned in the preceding exam levels. As with Levels I and II, you must have a firm grasp of how to apply the CFA Institute Code of Ethics and Standards of Professional Conduct in Organizations. The focus here is on synthesis and evaluation.
The 2008 Level III exam consists of 12 to 15 constructed response (essay) questions in the morning session and 10 six-question item sets (60 questions in total) in the afternoon session. Each session is three hours long, separated by a lunch break. The essay portion of the exam will typically include at least two rather lengthy questions related managing portfolios for institutional and individual investors.
Download a sample item set and essay questions provided by the CFA Institute.
Exam Topics
The Level III exam is weighted according to the following topic areas:
- Ethical and Professional Standards, 5-15 percent
- Asset Valuation, 40-50 percent
- Equity Investments, 5-15 percent
- Fixed Income Investments, 10-20 percent
- Derivatives, 5-15 percent
- Alternative Investments, 5-15 percent
- Portfolio Management, 35-45 percent
As you can see, the Level III exam emphasizes Portfolio Management and Asset Valuation. Some questions draw on concepts covered in multiple study sessions. More so than the other two levels, Level III requires you to apply reasonable judgment rather than simply drawing on facts and figures.
