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CFA Portfolio Management Study Tips


Portfolio management is one of the topics tested on the CFA Level 1 exam. However, only 8-12% of the CFA questions on Level 1 will cover portfolio management. But then, this topic gradually grows in significance as you progress through the three levels on the CFA exam. For example, in Level 3, half of the curriculum is about portfolio and wealth management.

CFA Portfolio Management Syllabus for CFA Level 1 Exam

The syllabus for the portfolio management section of the CFA Level 1 exam has one study session divided into four readings. The first reading offers a review of the portfolio management function. Next, the second one deals with risk and return statistics. After you’ve conquered that topic, the third section expands on these concepts to the CAPM model. And finally, the fourth reading covers portfolio planning and construction.

The second and third readings are the lengthiest with the most number of EOC questions. The final reading on Investment Policy Statement (IPS) is short but worth your attention. After all, it is the foundation for key parts of the curriculum on the CFA Level 2 exam and particularly the Level 3 exam.

What to Watch for on the CFA Level 1 Exam

The topic of portfolio management remains small and basic at Level 1. Candidates should understand the core concepts, such as the relationship between diversification and risk and how to effectively build a portfolio. The calculations on variance of a portfolio and CAPM are also important.

The vast majority of portfolio management calculations are reviewed in Quant. If you went through the Quant section, you should be fine from a calculation standpoint. However, you still need to read and review for tackling the qualitative questions.

Further Reading about How to Pass the CFA Exam

Here are more tips on these topic areas:

topic-cfa-ethics topic-cfa-quant topic-cfa-economics topic-cfa-fra topic-cfa-corporate-finance
topic-cfa-equity topic-fixed-income topic-cfa-derivatives topic-cfa-alt-investments cfa portfolio management

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