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CFA Scoring System Overview
The multiple-choice questions for all CFA exam levels are graded by computer, while the essay portion (“constructed response”) of Level 3 is graded by CFA charterholders.
Level 1 exam scores are delivered within 60 days of taking the exam. Level 2 results are also available within 60 days of taking the exam. And Level 3 results take 90 days (because of the essays).
For the essay portion, the human graders are put on teams, and each team grades a question using a rubric that is provided by the CFA Institute. During the first week of grading, various levels of charterholders, and a “grader of graders”, grade all the exams, but also review each other’s work to ensure consistency.
In the second week, the middle fifty percent of exam scores are graded a second time. If there is a large variance in grading, the exams are then graded for a third time. The exams are then assigned a Minimum Passing Score, or MPS.
The MPS is considered a benchmark to determine if a given candidate has passed or failed the CFA exam. The MPS varies from year to year and is set by CFA charterholders on the Board of Governors of the CFA Institute.
During this scoring phase, the Board of Governors typically sets the MPS for Level 1 and Level 2 about six weeks after the exam completion and grading. For Level 3, the MPS is set about seven weeks after exam completion and grading.
Candidates will not receive a conventional numerical score for their exams. Once the Board of Governors have set the Minimum Passing Score, it is then used as the baseline and applied to all graded exams. Thereafter, the candidates are allowed to see their results.
A candidate is given a final determination of “Pass” or “Did not pass” as their exam score or result. Accompanying their pass or fail determination is a summary of how they performed in each topic on the exam, and the maximum possible points for each topic. The score is expressed in as being in one of three ranges, either below 50 percent, between 50 and 70 percent, or more than 70 percent.
CFA Level 1 Passing Score
Each level of the CFA has its own criteria for determining its passing score. The CFA Institute Board of Governors sets the MPS for each level, and that changes with each cycle of new candidates.
Some years test takers will receive a 65% overall score and fail, while in other years candidates have received a 62% score and passed. How the scoring is weighted plays heavily on how your overall score will turn out. Generally speaking, any score of 70% or higher should be a passing score.
CFA Level 1 Pass Rate
Gaining your CFA certification is not an easy task. The Level 1 test is intentionally designed to be fairly difficult, but for a good reason. The Board of Governors purposely sets the bar high so that only those with a deep and broad understanding of the subject matter move forward to Level 2, and the pass rate definitely supports that philosophy.
On average (measured by a 10-year rolling basis), only 41% of candidates that take the CFA Level 1 test pass the exam.
CFA Level 2 Passing Score
For the second level of the CFA, you will need a score of at least 65% to have a good chance of passing, although from year to year any score under 70% can be a pass or fail based on that year’s weighted scoring. Again, the Board of Governors will determine the MPS and determine whether or not each candidate is within the passing range.
As long as you score well on the multiple-choice questions, you should have a good chance of passing the second level of the CFA.
CFA Level 2 Pass Rate
Level 2 of the CFA is often considered to be the hardest of the three sections. On average, about 45% of candidates pass the second level exam. It may seem like the first section would be harder, since it has a lower pass rate, but that isn’t the case.
Since the Board of Governors purposely sets the MPS so high for Level 1, only the most qualified candidates sit for the Level 2 exam.
CFA Level 3 Passing Score
When the Minimum Passing Score is determined for the Level 3 exam, it is often placed in the 60% range. This means that you would need to score approximately 60% during each testing portion of the Level 3 exam, both the morning and afternoon component. It follows that if you only score approximately 50% in the morning section, you will need to score approximately 70% in the afternoon to mitigate the difference and give you the best chance at being above the minimum MPS for the Level 3 exam.
CFA Level 3 Pass Rate
The third and final level of the CFA exam has the highest success rate of the three segments. On average, 52% of test takers that make it to Level 3 will pass the test. This last section of the test proves to be difficult for many candidates due to the fact that a large number of the questions require answers in essay format.
It is recommended that anyone that makes it this far spend significant time focusing on how to quickly and efficiently answer essay questions as well as brushing up on master topics such as portfolio management.