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| Level III CFA Exam |  The Level III CFA Exam is an in-depth review of the entire portfolio management process, and requires that you present a working knowledge of the process, including the application of concepts learned in the preceding exam levels. You must have a firm grasp of how to apply the CFA Institute Code of Ethics and Standards of Professional Conduct in Organizations, as with Levels I and II. The exam concentrates on synthesis and evaluation.
This exam consists of 12 to 15 constructed response (essay) questions in the morning session and 10 six-question item sets (60 questions in total) in the afternoon session. Every session is three hours long, separated by a lunch break. Typically, the essay portion of the exam will include at least two rather lengthy questions related managing portfolios for institutional and individual investors.
Exam Topics
The Level III exam is weighted according to the following topic areas:
• Ethical and Professional Standards, 5-15 percent
• Asset Valuation, 40-50 percent
o Equity Investments, 5-15 percent
o Fixed Income Investments, 10-20 percent
o Derivatives, 5-15 percent
o Alternative Investments, 5-15 percent
• Portfolio Management, 35-45 percent
The Level III exam emphasizes Portfolio Management and Asset Valuation. There are questions draw on concepts that are covered in multiple study sessions. More than the previous two levels, Level III requires you to apply reasonable judgment rather than simply drawing on facts and figures.
Keep in mind that the goal is not a perfect score, but a passing score. You can afford to miss quite a few questions and still pass, so don't get frustrated or anxious if you find yourself confronted with a difficult question.
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