The CAIA exam is offered in a two-tier system. This means that you have to take and pass CAIA Level 1 exam before moving on. Let’s talk a look at the curriculum, exam format and historical pass rate.
Candidates are expected to know about major asset classes in alternative investment, the difference from traditional products, and benefits of an active asset allocation.
The curriculum is divided into the following topics:
The graph below shows the relative weighting of each topic. Ethics, introduction to alternative investment, hedge funds and risk / portfolio management are more heavily weighted in Level 1.
The curriculum is updated annually to reflect the latest industry and research developments.
Check out details on Level 1 curriculum here >>
The CAIA Level 2 exam consists of 200 multiple choice questions. We have a page on CAIA exam structure with more information on the question types and run-down on exam day.
The pass rate was 66% in 2015. To learn about the implications from the historical trend, please see my analysis here.
The CAIA Association recommends that candidates devote 200 or more hours of study to preparation for this section. The candidates I know study for a lot less, but they have been working in the private equity or hedge fund industry.