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Accounting Documents

CFA Level 3

Exam pattern of CFA level 3

CFA Level 3 Syllabus

The CFA Institute provides syllabus of CFA level 3 exam and the list of important topics on its official website. The official curriculum of CFA level 3 covers complete details related to the topic, sub-topics covered as well as the weightage carried by each topic.

CFA Level 3 curriculum
Detailed CFA Level 3 Syllabus

Candidates must go through the entire syllabus of CFA level 3 before starting the preparation. Following listed are the topics covered under each subject of CFA level 3:

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Portfolio management and wealth planning

Portfolio management and wealth planning covers 35%-40% of the entire syllabus of CFA level 3 exam. Behavioural finance, private wealth and institutional topics covers 15%-25% and asset allocation, trading, performance evaluation covers 10%-20% of the entire topic. The sub-topic of portfolio management and wealth planning are:

  • The investment policy statement

  • Modern portfolio management concepts

  • Investment vehicles (including etfs and mutual funds)

  • Market efficiency and passive investing

  • Market indexes

  • Behavioural finance

  • Technical analysis

  • Environmental, social, and governance (ESG) investing

  • Management of individual/family investor portfolios

  • Tax impact of investment decisions

  • Management of institutional investor portfolios

  • Investment manager selection

  • Asset allocation

  • Portfolio construction and revision

  • Currency management

  • Liability – driven investments (including asset liability management and Goal-based investing)

  • Risk management (including environmental risk)

  • Execution of portfolio decisions (including trading and market microstructure)

  • Performance attribution and appraisal

 

Fixed income

Finance income subject covers 15 to 20% of the CFA level 3 syllabus. The sub topics of fixed income are:

  • Types of fixed-income securities and markets

  • Fundamental fixed income analysis

  • Term structure determination and yield spreads

  • Valuation of individual fixed income securities

  • Analysis of interest rate risk

  • Analysis of credit risk

  • Valuing bonds with embedded options

  • Structured products

  • Fixed-income portfolio management

 

Ethical and professional standards

Ethical and professional standards subject covers 10 to 15% of the entire syllabus of CFA level. The subtopics of Ethical and professional standards are:

  • Professional standards of practice

  • Ethical practices

  • Asset manager code of professional conduct

  • Presentation of performance results (GIPS)

 

Equity investments

Equity investment subject covers 10 to 15% of the CFA level 3 syllabus. The subtopics of equity investments are:

  • Types of equity securities and markets

  • Fundamental equity analysis

  • Valuation of individual equity securities

  • Equity market valuation

  • Equity portfolio management

 

Economics

Economics subject of CFA level 3 covers around 5 to 10% of the complete syllabus of CFA level 3. The importance of economics are:

  • Market forces of supply and demand

  • The firm and industry organization

  • Business cycles

  • Inflation and deflation

  • International trade and capital flows

  • Currency exchange rates

  • Monetary system, monetary and fiscal policy

  • Economic growth and development

  • Effects of regulations

  • Economic analysis and setting capital market expectations

  • Effects of geopolitics on economies and investment markets

  • Applications of economic indicators in the investment process

 

Derivatives

Derivatives subject comprise 5 to 10% of the entire CFA level 2 syllabus. Important topics of derivatives are as under:

  • Types of derivative instruments and markets

  • Valuation of forwards and futures contracts

  • Valuation of option contracts

  • Valuation of swap contracts

  • Uses of derivatives in portfolio management

 

Alternative Investments

Alternative investments subject covers the 5 to 10% of the CFA level 3 syllabus. The important topics of alternative investment are:

  • Types of alternative investments

  • Real estate

  • Real assets (including infrastructure, timber and farmland)

  • Private capital (including private equity, private credit and venture capital)

  • Hedge funds

  • Commodities

  • Alternative investments portfolio management

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