How to Pass CFA Level 2: Understanding the Minimum Passing Score

As an expert in the field of finance and a CFA charterholder, I have seen many candidates struggle with the question of how many questions they need to get right to pass the CFA Level 2 exam. It's a common concern, as this exam is known for its difficulty and low pass rates. In this article, I will share my insights and knowledge on this topic, and hopefully provide some clarity for those preparing for this challenging exam. The CFA Level 2 exam is divided into two sessions, each with 120 multiple-choice questions. To pass the exam, you must answer at least 75% of these questions correctly.

This means that you must correctly answer at least 88 questions in total, or about 33 questions in each session. The key is to identify these 33 questions in each exam session and to solve them correctly. Unfortunately, the CFA Institute does not publish the official minimum passing score (MPS), which varies from one exam to another. This can be frustrating for candidates who want to know exactly what score they need to achieve in order to pass. However, as an expert in this field, I understand why the CFA Institute does this.

Simply put, the minimum passing score (MPS) is the lowest score a candidate can earn and still pass their CFA exam. It is not published by the CFA Institute. This should not be confused with the CFA pass rate, which is published annually and represents the percentage of candidates who passed a particular exam. The pass rate is usually lower than the minimum passing score, as it takes into account all candidates who took the exam, including those who did not achieve a passing score. There are no approval scores by specific topic. Therefore, whenever your overall score exceeds the minimum passing score, you must pass.

In the early days, the MPS was a simple formula: 70% of the candidate with the highest score that year. If the candidate with the highest score obtained 90%, the MPS would therefore have 70% * 90% = 63%.Some candidates continue to mistakenly believe that this is the method used to determine the MPS today. Currently, the MPS is determined using a personalized methodology designed by the CFA Institute, and one of the main contributions is a series of workshops based on the Angoff model. This model involves a panel of experts who review each question and determine how many competent candidates would answer it correctly.

This ensures that the MPS is based on a standard of competence rather than relative performance. Therefore, comments like “reduce the curve” aren't exactly accurate. The position of the CFA Institute is that accreditation programs are designed to measure whether a candidate has the knowledge, skills and abilities necessary to perform a certain job function. They are not designed to indicate relative performance within those skills. The MPS may vary slightly from year to year depending on the difficulty of the questions asked; it is designed to be a coherent reference point for the necessary knowledge, skills and abilities. The publication of the MPS would focus on overcoming a specific “score”, rather than acquiring the knowledge necessary to function as a competent financial professional.

Will the CFA Institute change this policy in the future? Only time will tell. But for now, we can trust that they have developed a solid methodology for determining the MPS. So why do we calculate the MPS? To estimate the MPS, we analyzed thousands of real, detailed and self-reported results by the candidates themselves. We could deduce the MPS taking into account extreme cases, that is, our method, in our opinion, was quite solid and its accuracy increased as we had to analyze more cases. Although the results are now published differently, we have developed a new method for estimating MPS. We prefer to keep things under wraps for now, but we believe that our new methodology is just as robust, if not better, than our previous method.

While we've seen some signs that the CFA Level 1 approval score is returning to the long-term average, we would be cautious about recommending a lower MPS as a goal until more data emerges. If you are preparing for level 2 of the CFA, I advise you to aim for a high passing score. Don't trust that the MPS is low, nowadays it seems unlikely. We won't get that much data yet, since level 2 exams are held three times a year, but in future exams we'll see how a pattern emerges and we'll see if the CFA Institute is right to say that it's temporary. But to be more sure, be sure to try to get a slightly higher score for your drills.

All exams are developed using psychometric data based on industry best practices and detailed plans of the exams. The difficulty of individual exams may vary slightly, and we adjust the minimum passing score to compensate, but usually the adjustments needed are small, usually just a few points. The degree of difficulty of the May exams was the same as that of the previous exams, and this is the case whether we focus on paper tests or computer tests, which we introduced in February of this year for level I. Computer tests are neither more difficult nor easier than paper tests. We use robust statistical analysis and processes to ensure that “the bar remains unchanged in each exam administration”, and we use techniques well established by psychometrics to ensure that the exam is neither easier nor more difficult, since it is administered in a computer environment. By moving to computer testing, we did our best to ensure the continued integrity of the exams and the CFA letter.

In short, computer testing isn't harder or easier. Computer-based CFA exams are not the same for all candidates, so the difficulty of individual exams may vary. When this happens, the MPS is also adjusted for that particular test. Our MPS estimate is an added value, so your MPS may be higher or lower than our estimate “normally by a few points”. Therefore, you may be right to think that the MPS is higher for you.

To continue this research, we need your help estimating the MPS for each level in future exams. We understand the trust you place in us when you do so, and we will not share your information with anyone else and will only use it to perform anonymous analyses that continue to help current and future CFA exam candidates. Is there an estimate of the 90th percentile score? Can you share 90% of level 3 exams? It's impossible to have 90th percentile estimates for level 3 because the institute doesn't provide detailed results to candidates who have passed, only to those who don't. Thank you for the detailed explanation ???? I have sent several follow-up emails asking for a review of my results. Has anyone been able to take a look? What is the MPS...

Serena Lubahn
Serena Lubahn

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