Clearing CFA level 1for Non Finance folks

A brief background first about me. I am Gopal and am a graduate in Instrumentation and control engineering. I work in the IT division of a bank and had got no prior experience in finance. I knew nothing other than Java/j2ee!! I decided one fine day that I was going to do CFA level in june 2010. Basic idea was to just get over the worries related job during the recession. I wrote my CFA level 1 on June 2010 and cleared with not so great results. But importantly I cleared! 


Here is my result:
Alternative investments <= 50
Corporate finance >= 70

Derivatives >= 70
Economics >= 70
Equity Investments 50 - 70
Ethical & Professional Standards >= 70
Financial Reporting & Analysis >= 70
Fixed Income Investments >= 70
Portfolio Management 50 - 70
Quantitative Methods 50 - 70


I am sharing the way I prepared and do not wish to say that this IS the only way to prepare. Best is follow the way a person who cleared and then after a month we would understand ourselves better. Remember I had a 4.5 yr old son and a family to take care of when I did this. I also had a demanding IT job and my wife was working. If I could clear this (even being a non finance guy), yourself should clear it easily.


But all you need for this is months of hard work. But believe me, the result is really sweet and really worth it. Do not immediately look at ROI, but enjoy the hard work. At 32 years if I could, you can too.

Preparation materials I used:

1. Stalla study notes and vidoes - I went for weekend classes @ www.newhorizonsedu.com

   - I found the study notes from stalla fantastic and amazing.

2. Visited and read all the posts @ www.analystforum.com

3. Referred www.analystnotes.com for economics. I found them good too.

4. There are lots of videos in Youtube and other video sites which explain a particular topic in detail - Example Income Tax which I found impossible to understand. These videos are great and really hammer the knowledge on to your head.

4. Complete Stalla passmaster CD - esp Ethics, quants and economics.

5. Complete End of Chapter questions for Ethics mandatorily. I tried doing it for FSA, did not succeed mostly because of lack of understanding. But I firmly believe, if you can do these problems, the rest is a formality.

I used the TI Professional calculator and bought a new one. I found this easy, but must admit I do not have hands on experience. So I leave the choice of calculator to you. Having said that One of the best tip I got from a member at analystforum - "On the exam day you would use the calculator far less than what you think". Turned out correct in June 2010 level 1 exam, there were hardly few questions which needed tvm calculations :)

I would like to share with you some points I can remember which helped me (or would have helped me if somebody told me this).You can call it tips or what ever :)

• Read everything atleast once - There is nothing which is unimportant. I know atleast 4-5 questions which I could have got correct, if I had read a particular paragraph in Stalla's material.  
• Having a study plan and sticking to it always helps. Starting this habit early makes it more effective.
• I felt that the three hundred hours of study which CFAI claims is real joke. I needed atleast 3 times that time (ofcourse I didnt know FSA at all). But be prepared to spend more time and energy since the subject is new. 
• Do not try to study with too many materials. Just Stalla along with analystforum would do actually. Analystnotes I used for economics.
• Prepare notes for economics/ AI for sure and read only them the second time around. Remember also that there is very minimal weightage for AI and economics 
• There are loads of videos available on the net which we can learn.
• Ethics is very important and if possible get the hand book on ethics from CFA institute. I read somewhere almost all situations are from the handbook. I never got it though and never tried it. I am going to buy this for my level 2 though.
• For me personally trying to understand some formulas worked better, rather than just mugging the formulae (ofcourse you would have to mug quite a few, but this method would reduce the number). The best to remember the important formulae is to read the complete End of Chapter stuffs.
• I heard from people that, learning and discussing as a group helps a lot. I never did that and so I dont know. 
• There is a trick to remembering formulae - Write chapter wise formulae on a piece of paper. You remember better when you write and read it with your own handwriting. Read this in auto/bus or at lunch time. Slowly you start associating the formulae to the position on the paper and you start remembering. Believe me it works :)
• Remember to read all the different yields in Bonds. They are absolutely important! Best way to remember them is to practise lots of problems.

Remember that we might not know finance area, but we are better than the finance guys in quantitative! Because I concentrated too much on economics, fsa and fixed income - have a look at my result?? I got less than 70 in quantitative! 

I just hope this was a bit helpful to you. Believe me, its tough hard work ahead. But no pains, no gains! Enjoy the hard work and enjoy your result. You have taken the right decision to do CFA and all the very best.