Introduction to CFA® Level II Exam

The CFA Level II exam is the second exam you need to pass to become a CFA charterholder. Once you pass the Level II exam, you will move on to the Level III exam.

What to expect for Level II

According to the CFA Institute, the 10-year average pass rate for the CFA Level II exam is 45%. In total, candidates report investing more than 300 hours into their studies for each level of the CFA exam.

Registration Opens: October 26, 2021

Registration Closes: May 3, 2022

CFA Exam Dates: August 30-September 3, 2022

Results are provided 6-8 weeks after exam

Exam Format

Exam Format

88 multiple choice questions

Evenly divided into 2 sessions

Approximately 132 minutes per session

Computer-based testing

Question format

Enroll Information

CFA Institute logo

Question Format

Vignette followed by 4 or 6 multiple-choice questions

Each vignette begins by stating the relevant topic and the item set's point value

Refer back to the vignette before answering a question

Exam Format

88 multiple choice questions

Evenly divided into 2 sessions

Approximately 132 minutes per session

Computer-based testing

Earn your CFA as a favor to your future self

Kevin Shires, CFP, ChFC, CFA, interviewed by Salt Solutions about the benefits of becoming a charterholder

Level II Topics and Weights

An exploration of ethics in the investment profession. Through case studies, we illustrate practical application of the Code of Ethics and Standards of Professional Conduct. Conclude with real-world violations with resulting regulatory actions.

A look at financial technology's impact on the investment industry. Examine linear regression with independent variables and time-series analysis. Explore machine learning techniques and their application. Discuss probabilistic approaches to assessing risk.

A discussion of currency exchange rates. Explore international parity conditions and the carry trade. Consider direct/indirect exchange rate influencers; theories of economic growth and its relationship to investment returns; and economic regulations.

A discussion of financial reporting and analysis for company investments, post-employment benefits, and foreign currency transactions. Learn to evaluate financial institutions and financial reports. Conclude with case studies on financial statement analysis.

A look at the capital budgeting process, focused on principles and investment decision criteria. Discuss capital structure and the classic Modigliani-Miller capital structure theories. Conclude with dividend and share repurchases policies.

A discussion of value and equity valuation techniques, covering key return measures. Learn to forecast model inputs and consider discounted cash flow valuation models, focused on the dividend discount model. Conclude company valuation.

An introduction to the yield curve and an arbitrage-free framework for valuing bonds. Use the binomial valuation method for bonds with embedded options, consider credit analysis models, and conclude by discussing credit default swaps.

An introduction to valuation concepts and models for forward commitments (forwards, futures, swaps) and contingent claims (options). Discuss option Greeks, which measure sensitivity to a change in valuation inputs. Conclude with option strategies.

An examination of methods for analysis and evaluation of private and public real estate investments, as well as private equity valuation, commodities, and commodity derivatives.

A discussion of portfolio management, multifactor models, value at risk, and risk measurement and management. Analyze active portfolio management. Consider ties between the economy and financial markets. Conclude with algorithmic and high-frequency trading.

Study Tips From Our Coaches

Just Keep Moving

The vignettes will likely have a lot of extraneous information. Don't let that slow you down. Read the question first, so you know what you are looking for in the passage. That can save you time on the exam, and make it more likely you'll answer the questions correctly.

Mike Carmody  CFA, FSA, MAAA
Lead Instructor

Answer the Right Question

Be sure to answer the question that has actually been asked. Read the questions carefully all the way through. Don't just read a few words and assume that you know what's being asked because you answered a similar question when you were studying. The correct answer to a question that wasn't asked is an incorrect answer to the question that was asked.

Marc Coward  CFA, MBA, MPhil
Lead Content Manager

Invest the Time

Level II is a more computationally intensive CFA exam than Level I. The material is also more complex and requires more in-depth analysis than Level I. Thus, make sure to invest sufficient time learning, practicing, and reviewing the material. Be proficient with your calculator.

Tong Teh  CFA, FSA
Product Manager

Experience Level II for yourself with free, full access to Quantitative Methods