The CFA Level I exam is renowned as a rigorous test of discipline, and (of course) fundamental finance knowledge. It’s the gateway to the Chartered Financial Analyst (CFA) charter and covers 10 broad topic areas – from Ethics to Derivatives. 

Success isn’t about raw intelligence or finance background alone; it hinges on smart preparation strategies and effective time management.

This guide will walk you through everything you need to know to conquer Level I on your first attempt: the latest 2026 exam format and syllabus, a candid look at the exam’s difficulty and scoring, evidence-based study techniques, tips for mastering both conceptual and quantitative material, a structured 4–6 month study plan, comparisons of major prep providers, and detailed exam-day strategies.

Is the CFA Level I Exam Difficult?

In a word: Yes. CFA Level I has a well-earned reputation for difficulty, reflected in historically low pass rates. 

On average, over the past several decades, only about 4 in 10 candidates pass CFA Level I. 

The August 2024 Level I pass rate was 44%. In 2021, in the latter stages of the COVID-19 pandemic, pass rates even dipped into the 20–30% range, though they have since normalized around the low 40s.

So why is it so challenging?

Key Challenges

For most candidates, the key challenge for Level 1 is not the difficulty of the content (the material tested tends to be foundational).

Yet because the breadth of material is enormous, candidates typically struggle to cover all bases. The Level I curriculum comprises approximately 3,000 pages of curriculum and hundreds of Learning Outcome Statements. You’ll need to recall a vast array of formulas, definitions, and concepts spanning ethics, economics, financial statement analysis, and more. 

And because, for many candidates, the CFA is entirely optional and taken alongside other work commitments, many find it difficult to sustain the motivation and consistency to cover all they need to know—and with enough practice.

Second, the questions are tricky. Every one of the 180 multiple-choice questions is free-standing (no partial credit), with three answer choices that are “crafted intelligently” to reflect common mistakes. 

In other words, many wrong choices look plausible if you’ve made a calculation or reasoning error, which punishes any shaky understanding.

Scoring and the Pass Mark

The  Minimum Passing Score (MPS)

A common misconception is that CFA exams are graded on a curve or with a targeted pass rate, but this is not the case. Instead, after each exam, a Minimum Passing Score (MPS) is set through a formal standard-setting process.

A forced curve would mean your result depends on who else sat the exam with you: in a weak cohort, some underprepared candidates might pass; in a strong cohort, some competent candidates would unfairly fail. 

Instead, the CFA minimum passing score is set using the Modified Angoff method. A panel of about two dozen diverse charterholders reviews each exam question and estimates whether a “just qualified candidate” (a candidate just at the threshold of passing) would answer correctly. Their judgments are aggregated to produce a recommended cut score.

This standard-setting process is redone every few years to keep it aligned with the curriculum and candidate demographics. 

In between, the Institute uses statistical equating to adjust for any small differences in difficulty across exam versions while applying the same MPS.

Historical analysis suggests the Level I MPS typically falls in the range of ~65–70% of available points.

In practical terms, that means you likely need around 117 to 126 questions correct out of 180 to pass.

Ethics Adjustment

One quirk in CFA scoring is the unofficial “ethics adjustment.” If a candidate’s total score is borderline near the MPS, the CFA Institute may give extra consideration to their Ethics section performance.

Strong Ethics scores can tip a marginal candidate into the pass category, whereas weak Ethics could sink an otherwise borderline score.

This makes Ethics especially important. 

We’ll discuss how to master Ethics later, but keep in mind that skimping on Ethics study is a risky gamble.

 

Exam Format and Syllabus for CFA Level I 

Timing

The CFA Level I exam in 2025 has a computer-based format consisting of two sessions:

The two sessions are each 135 minutes (2 hours 15 minutes). 

There are a total of 180 multiple-choice questions. 90 questions are delivered in Session 1 and 90 in Session 2.

On average, you have about 90 seconds per question. 

This is a tight pace. Some questions will take less time, others (especially those involving calculations or careful analysis) may take more. Time management is a major exam-day challenge.

Question Format

Each question is stand-alone (not part of item sets or vignettes – those come at Level II), and each has 3 answer choices (A, B, C).

The CFA Institute employs two basic MCQ formats at Level I, both featuring a single stem and three answer options (A, B, C):

(1) Sentence Completion

The stem is an unfinished sentence. Your job is to pick the option that best completes it.

Example:
The primary purpose of calculating the weighted average cost of capital is to:
A. estimate the minimum return a project must earn.
B. determine the company’s dividend payout ratio.
C. measure how efficiently assets are being used.

(2) Direct Question

The stem is a straightforward question. You choose the single best answer among three.

Example:
Which of the following best describes the effect of an increase in the risk-free rate on the value of a call option?
A. The option value will rise.
B. The option value will fall.
C. The option value will remain unchanged.

There is no penalty for wrong answers – your score is simply the number of questions answered correctly. Therefore, you should answer every question (guess if you have to).

Topic Coverage and Weightings

The Level I curriculum is organized into 10 topic areas, each with an assigned weight range in the exam. The table below shows the 2025 CFA Level I topic weightings:

Curriculum Area	% / # of Questions	What’s Included
Ethical and Professional Standards (Ethics)	15–20% (~27–36 Qs)	Ethical dilemmas, Code of Ethics, Standards of Professional Conduct, GIPS standards. CFA Institute places heavy importance on Ethics; a strong score can be decisive and builds for Levels II/III.
Quantitative Methods	6–9% (~11–16 Qs)	Time value of money, statistical concepts, probability, hypothesis testing, correlation & regression, plus newer topics like machine learning basics.
Economics	6–9% (~11–16 Qs)	Micro (supply/demand, market structures) and macro (growth, business cycles, monetary/fiscal policy, inflation, exchange rates).
Financial Statement Analysis (FSA)	11–14% (~20–25 Qs)	Financial reporting & analysis (primarily IFRS). Ratios, accounting mechanics, IFRS vs. U.S. GAAP differences, and income statement/balance sheet/cash flow analysis.
Corporate Issuers (Corporate Finance)	6–9% (~11–16 Qs)	Corporate governance, capital budgeting, cost of capital, financing & capital structure, dividends, working capital management.
Equity Investments	11–14% (~20–25 Qs)	Equity markets & instruments, valuation methods (DDM, multiples), industry and company analysis.
Fixed Income	11–14% (~20–25 Qs)	Bond characteristics & valuation, yield measures, term structure, credit analysis, securitized products.
Derivatives	5–8% (~9–14 Qs)	Forwards, futures, options, swaps; valuation fundamentals and payoff diagrams.
Alternative Investments	7–10% (~13–18 Qs)	Hedge funds, private equity, real estate, commodities, infrastructure; characteristics and portfolio roles.
Portfolio Management	8–12% (~14–22 Qs)	Portfolio concepts, diversification, risk/return measures, portfolio planning, basics of portfolio construction (e.g., CAPM).

Typically, Session 1 vs. Session 2 divide these topics as follows (though the official guidance does not specify):

Session 1: Ethics and investment tools (e.g. quantitative methods, financial statement analysis, and economics).

Session 2: Portfolio Management and Analysis and Assets (fixed income investments, equity investments, alternative investments, and derivatives). 

Within each session the 90 questions can appear in any order. Don’t be surprised if, for example, an econ question pops up right after an ethics question – the exam mixes topics, so you need mental agility to switch gears quickly (practicing with mixed-topic question sets helps build this skill).

Calculator policy

You’re only allowed one of two specific calculator models – Texas Instruments BA II Plus (including BA II Plus Professional) or Hewlett Packard 12C. 

You must bring your own approved calculator to the exam. Make sure you are completely comfortable with it (how to use the cash flow worksheet, how to do exponents, IRR, NPV, etc.) – calculator fluency can save precious time. 

We strongly recommend using the BA II Plus for practice throughout your studies if that’s the calculator you’ll use on exam day (most candidates do). Fresh batteries are a must.

If you don’t yet want to spend the money on a calculator, you can download the app simulator of one of the approved models. However, you will not be able to use the phone version in the exam, so make sure you eventually get plenty of practice with the physical model. Drilling those functions and formulas is crucial preparation for the exam.