Everything you need to know about the Level III CFA exam

By this point, you’re a CFA exam veteran. After passing the Level I and Level II exams, your confidence is strong. That confidence is an asset, but don’t take your foot off the gas just yet. Passing Level III is going to take some work. As we often receive a variety of questions from candidates preparing for the Level III CFA exam, here’s a compiled list of those questions and answers for your reference and understanding.

  • How is Level III different from Level I & II of the CFA exam?

The most significant difference is that it’s no longer just multiple-choice questions. For Level I, if you learn, and can recall, the appropriate factoids, you’re going to pass the exam. Level II is typically said to be the most difficult as the multiple-choice questions are math-based, and the solutions are deterministic.

Level III CFA exam questions are more like case studies. There’s math involved, but it often can’t be reduced to a single equation. Level III essentially tests your ability to effectively do what employers will expect of you as a CFA charterholder.


  • What is the exam schedule for Level III of the CFA exam?

The exam will no longer be offered in June but instead will be offered twice a year. From 2021 onwards, it will be offered in May & November. There will also be an additional exam window being offered only in 2021 during the month of August.

The exam windows of up to 10 days instead of one uniform date with the total testing time is reduced from six hours to approximately 4.5 hours. If you would like to reschedule your exam date, a USD 25 fee will be applicable.

In addition to the time reduction, candidates will be free to walk out of the exam session as soon as they finish, even if the exam is still in session.


  • What can be expected in terms of the exam format for the Level III of the CFA® Program?

From 2021 onwards, the exam will be offered in a computer-based testing format. The exam will have item sets comprised of vignettes with accompanying multiple-choice items and constructed response (essay) questions. It will be approximately 4.5 hours, split into two sessions with an optional break in-between.

The first session of the exam is comprised of 8 to 11 constructed response (essay) questions. For example, you may be asked a multiple-choice question to select the portfolio (A, B, or C) that meets a particular objective, followed by an essay question to justify that response. The second session is comprised of 44 multiple-choice items, each worth 3 points.

Both essay and multiple-choice items must be answered based on the information in the vignette. Hence, the items are not free-standing (as in the CFA Level I exam). You will need to refer back to the vignette before answering each item.


  • What are the topics and weights for the Level III exam?

On a year-to-year basis, the Level III CFA exam topic weights are subject to change, at the discretion of the CFA Institute. For the exam in 2021, topics are weighted as :

  • Ethical and Professional Standards: 10 – 15%
  • Fixed Income: 15 – 20%
  • Derivatives: 5 – 10%
  • Alternative Investments: 5 – 10%
  • Portfolio Management: 35 – 40%
  • Equity Valuation: 10 – 15%
  • Economics: 5 – 10%


  • What’s the amount of time required to study for Level III?

Candidates stated that they spent an average of 344 hours preparing for the exam when asked in the 2019 CFA Candidate Survey by the CFA Institute. The time spreads over a 6 month period with 12.5 hours per week. Although, candidates don’t always start studying early and tend to compress their study time into a shorter window. The intensity of your study schedule depends greatly on how early you begin preparing.


  • How much does the Level III CFA® exam cost?

Registration plays a huge role in determining the cost of the exam. There are three registration windows called – early, standard, and late. The fees are $700 for early and $1,000 for standard. Registering early will not only help you save $300 which you could invest in a CFA Program exam prep course but will also help you start preparing sooner.