Mastering the CFA Program: From Level I to Level II

Learn from an expert's perspective whether it is possible to take the CFA Level II exam without passing Level I. Understand the importance of building a strong foundation at Level I and how to effectively prepare for Level II.

Mastering the CFA Program: From Level I to Level II

As an expert in the field of finance and investments, I have encountered numerous individuals who are eager to take on the challenge of earning their Chartered Financial Analyst (CFA) designation. One of the most common questions I receive is whether it is possible to take the CFA Level II exam without passing Level I. The short answer is no, but let me explain why. The CFA Program is a rigorous and comprehensive program that consists of three levels. Each level builds upon the previous one, with Level I being the foundation for Level II and so on.

Therefore, it is essential for candidates to pass each level in order to progress to the next one. Firstly, let's address the misconception that one can take both Level I and Level II exams at the same time. This is not possible as the CFA Institute requires candidates to pass Level I before being eligible to take Level II. Additionally, if you qualified for the Level I exam because you were in your final year of a degree program, you must complete your degree before taking the Level II exam. Now, let's focus on the main question at hand - can a candidate skip Level I and go straight to Level II? The answer is no, and here's why.

The Importance of Building a Strong Foundation at Level I

The CFA Level I exam consists of 180 questions that cover a wide range of topics such as ethics, economics, financial reporting and analysis, corporate finance, equity investments, fixed income, derivatives, alternative investments, and portfolio management. These questions are designed to test a candidate's understanding of fundamental concepts and their ability to apply them in real-world scenarios. At this level, candidates are expected to have a basic understanding of the Code of Ethics and Standards of the CFA Institute.

However, this is just the tip of the iceberg. As a Level II candidate, you will need to have a deeper understanding of these standards and how they apply to different situations.

The Transition from Level I to Level II

As a candidate progresses to Level II, the exam format changes significantly. Instead of standalone questions, candidates are presented with vignettes that require them to analyze and interpret financial data in order to answer multiple-choice questions. This means that a candidate must be able to quickly scan a vignette and select the necessary data to answer a particular question. In addition, at Level II, the candidate's ability to link one theory or concept to another is evaluated.

This requires a higher level of critical thinking and analytical skills. Unlike Level I, where each question is unrelated to the others, Level II questions may require a candidate to apply multiple concepts in order to arrive at the correct answer. Furthermore, the CFA Institute reserves the right to close enrollment and programming dates earlier than previously announced if conditions justify it. This means that candidates must be well-prepared and ready to take the exam at any given time.

The Importance of Preparation for Level II

Compared to Level I, a candidate will need a higher level of preparation and skill to select the correct answer to a Level II question. This is because not only are the concepts more complex, but the questions also require more concentration and critical thinking skills. Many candidates make the mistake of assuming that their previous studies for Level I will be sufficient for Level II.

However, this is not the case. As mentioned earlier, Level II requires a deeper understanding and application of concepts learned at Level I. Therefore, it is crucial for candidates to dedicate enough time and effort to prepare for this exam. Moreover, many candidates face new personal situations and distractions when preparing for Level II. This could be due to school, work, or family commitments.

Therefore, it is essential to plan and manage your time effectively in order to stay on track with your studies.


In conclusion, while it may be tempting to try and skip Level I and go straight to Level II, it is not possible. The CFA Program is designed to build upon the previous level, and each level is equally important in preparing a candidate for the final exam. Therefore, it is crucial for candidates to take the time to build a strong foundation at Level I before moving on to Level II. With dedication, hard work, and effective time management, anyone can successfully pass the CFA exams and earn their coveted CFA designation.