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Level III CFA Exam Structure

Exam Structure and Duration

Structure: The Level III exam consists of item sets comprised of vignettes with accompanying multiple-choice items and constructed response (essay) questions.

Duration: The Level III exam will be 4 hours and 24 minutes, split into two equal sessions of 2 hours and 12 minutes, with an optional break in-between. 

Learn how hardware/software at the test centers may impact your exam-day experience.

CFA Level III Exam Question Format

CFA Exam Constructed Response (Essay) Format

The first session of the CFA Level III exam is comprised of 8 to 11 vignettes followed by several questions that require a written response. There will be some multiple-choice questions in this session, as well. For example, you may be asked a multiple-choice question to select the portfolio (A, B or C) that meets a particular objective, followed by an essay question to justify that response. There also may be some numerical entry questions, where only a number is required, with no opportunity to show work. The majority of the questions, though, will be traditional essay.

The questions in the essay session have varying point values. At the start of each essay vignette, the total point value for that vignette will be stated. For time management purposes, consider 1 point to equal 1 minute of time to be spent on that essay vignette. 

Formatting Conventions Used for Level III Exam, Essay Portion

At Level III, the first session will be vignette-supported essay sets that have items with three different methods of entering a response: essay, numerical entry, multiple choice. 

  • Essay questions
  • In the question stem, command words will be used and will be bolded.
  • A text box is available for the response.
  • If more than one answer is requested, (for example, “Explain, with two reasons…”), the following note is included: 
    “Provide each response in a separate paragraph”. 
    Bullet points are acceptable, as well. An important message to note – when asked to provide more than one response, the responses will be evaluated up to the number requested, and in the order presented by the candidate. Anything more than the number requested will not be evaluated.
  • A calculation could be presented as an essay or a numerical entry.
  • An essay text box will accept typed words and numbers. Note that a correct numerical value typed in the essay box by itself receives full credit – formulas and explanations are not required. If a candidate chooses to do so, they may describe steps used in the calculation or show values using either a math editor function or typing out variables in an equation.
  • A numerical entry response box will only accept numbers, commas and a decimal point. There is no room to show work. A question may contain a note with specific guidance on how to format the answer, such as: 
    Provide your answer as a percentage, rounded to one decimal place. 
    10.8 %
  • When a multiple-choice question format is used in the essay portion of the exam, it is possible that there may be more or less than 3 answer choices. There are no bolded command words used in multiple-choice questions.
  • Items within an essay set may be related to each other. Two examples are presented:
  • Example 1 
    Item 1 is a multiple-choice question: 
    The bond that best meets the advisor’s objective is: 
    (You will be asked to justify this response when answering the 
     next question.) 
    A:    Bond X. 
    B:    Bond Y. 
    C:    Bond Z. 
    Item 2 is the related essay question: 
    Justify your previous response with two reasons. 
    Note: Each justification should be in a separate paragraph.
  • Example 2 
    Item 1 is a multiple-choice question: 
    Select the strategy that best meets the client’s requirements.  
    (You will be asked to explain why the other two strategies are less appropriate in the next question.) 
    A:    Put spread 
    B:    Covered call 
    C:    Cashless collar 
    Item 2 is the related essay question: 
    Explain why the two strategies not selected in the previous question are less appropriate, referencing two characteristics for each
    Note: Each strategy explanation, with its two characteristics, should be in a separate paragraph. 

CFA Exam Item Set Format

The second session of the CFA Level III exam is comprised of 44 multiple choice items, each worth 3 points. Each item set on the CFA exam consists of a vignette followed by either 4 or 6 multiple-choice questions.

All questions must be answered based on the information in the vignette. Hence, the items are not free-standing, as in the CFA Level I exam. You will need to refer back to vignette before answering each item.

The CFA® Program curriculum topic areas for Level III will  be randomly placed on the exam. All topics may be covered in either the first or second sessions, and possibly both sessions. Each vignette will begin with a statement of the topic and total point value. For example:

Example Level III Exam Questions

Below is a link to examples of Level III item set questions.