As a seasoned expert in the field of finance and investments, I have encountered numerous aspiring professionals who have struggled with the Level 1 CFA exam. Through my years of experience and research, I have identified the most difficult topics that candidates face in both Level 1 and Level 2 of the CFA program. According to our findings, the top five most challenging topics in Level 1 CFA are financial statement analysis, fixed income, quantitative methods, derivatives, and economics. These subjects require a strong understanding of complex concepts and calculations, making them particularly daunting for many candidates. Similarly, in Level 2 CFA, candidates often struggle with the analysis of financial statements, portfolio management, ethics, and derivatives. These topics build upon the foundation laid in Level 1 and require a deeper understanding of advanced concepts. Having personally taken the exam in December, I can attest that SS9 (Corporate Finance) was by far the most difficult subject to study.
The concepts of deferred taxes and leasing issues were particularly challenging to grasp. However, when it came to the actual exam, I found that the questions on ethics were the most difficult. Despite my extensive preparation and knowledge of the material, I often found myself torn between two options when answering ethics questions. This is a common struggle among candidates as ethics is a subjective topic that requires careful analysis and application of ethical principles. One of the main reasons why candidates find certain topics in Level 1 CFA so challenging is because they lack a comprehensive understanding of the underlying logic. This is especially true for financial statement analysis (FRA), which can be overwhelming for many candidates. However, as one progresses to Level 2 CFA, the full picture of FRA becomes clearer and easier to comprehend.
This is because Level 2 builds upon the foundation laid in Level 1 and provides a more holistic understanding of the subject.