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LOS keywords

One of the biggest misconceptions about the CFA exams is the idea that you have to be a human calculator and be able to produce valuations to the 7th decimal place on demand without writing anything down. The fact that they allow you to use a calculator and pencils should be enough to do away with this myth, but it persists. Less facetiously, it cannot be denied that there is a lot of quantitative material to cover.

Nevertheless, CFAI is much more interested in candidates who can think and reason through situations. They want candidates to be able to know that the presence of x causes y to increase - they are much less concerned about whether you can tell them precisely how much it increased by (except for maybe at Level 2, that exam is like six hours of sitting in a dentist's chair - sorry).

To demonstrate my point, I am providing a list of LOS keywords and the frequency with which they appear. These are for Level 3, but I doubt that these frequencies are much different than for the other exams (except for Level 2, which, again, is sheer agony). There are 362s LOSs for the level 3 curriculum although, I put this number closer to 380 because it is foolish to suggest that there are only 2 LOSs for the entire 130 pages of Reading 2. But let's stick with the 362 figure for the purposes of this post. In alphabetical order, they are:

Analyze (1), Calculate (10), Compare (39), Construct (1), Contrast (14), Critique (5), Demonstrate (23), Describe (13), Determine (5), Discuss (86), Distinguish (11), Evaluate (31), Explain (91), Formulate (5), Identify & Interpret (7), Interpret (7), Judge (2), Justify (1), Prepare (1), Recommend (8), Select (1).

That's it. "Explain" and "Discuss" are miles ahead of the competition with "Compare" and "Evaluate" fighting it out for the bronze. When asked to comment on his disappointing 8th place finish, "Calculate" was quoted as saying: "I guess I'm just not as important as people make me out to be. I mean, I barely registered in double digits and I got beat by "Contrast" and "Describe" Maybe I should stop going around scaring people by giving them the idea that these exams are all about me."


  • christinechristine On the movePosts: 632 Sr Portfolio Manager
    That does sound right from a Level 3 perspective - 'Calculate' is very light in Level 3.

    I would say the most quantitative is Level 2, followed by Level 1 then Level 3.

    However, the problem is exacerbated by two issues:
    1. Schweser, which tends to be much more quantitative than the actual exam in all 3 levels. I know not everyone uses Schweser, but anyone who does should know the bias.
    2. Conditioning from Level 1 and 2. Since they're much more quantitative than Level 3, candidates that had just cleared Level 2 may not necessarily expect a dearth of calculation focus.

    Nice to meet you btw @marc!
  • MarcMarc TorontoPosts: 186 Portfolio Manager
    Nice to meet you @christine! I'm a big fan of your work. You've got a great site here.
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