Level 1 results

The level 1 results are out today. Of course being level 2 this doesn't affect me much, but it's still another milestone in this interminable wait. The level 1 results are out early because if you fail, you need enough time to prepare for the next exam which is now four and a half months away. With level 2 and 3 the next exam pass or fail isn't until June 09. It's a good thing that they are giving the people who failed time to prepare because according to the website two of every three test takers at level 1 failed. The total pass rate was 35% which is the lowest ever in any year for any level. I'm not too surprised about that.

There are two factors I believe lead to that pass rate (or is it failure rate when it's that high?). First, the popularity of the designation has greatly expanded over the years. Employers want people with the designation and that leads more people to make the attempt. However, employers want the designation because it is hard to get and too many candidates don't respect that. Take it from me, someone who has failed level 1 before, it takes over 6 months of hard studying for at least 200 hours. People constantly ask for shortcuts or ways to not have to study. It doesn't matter how much you know, or how smart you are. The main factor is how hard you work.

The second factor is that the universe of finance is constantly growing and the knowledge that they test is also expanding. 20 years ago derivatives was a very small part of the financial universe so one didn't have to know much about them to earn the charter. Today derivatives are much more popular in the real world so candidates are tested more now than before. There are something on the order of 20 times as many hedge funds today was there were 15 years ago, so now a candidate must learn about those as well.