CFA Exam Grading System: How the Numbers Work

Level 1 CFA exam questions are tough enough on its own, but if you understand the scoring system you'll feel more ready to take the exam. 

Level 1 CFA exam questions are tough enough on its own, but if you understand the scoring system you'll feel more ready to take the exam. 

How is the exam scored? Can you earn partial credit for a question? How can you know if there is a possible error in your exam score? And what in the world is the Minimum Passing Score (MPS)?

Those are great questions, and we’re glad you asked.

Multiple-Choice (MCQ)

First up, we have the one and only, MCQ! 

  • All multiple-choice questions on all three levels of the CFA exam are machine-graded.
  • Roughly 10% of exams will be checked by hand to see if the machines are working correctly and making sure they're grading accurately.
  • During the grading period, the clarity and validity of multiple-choice questions may be reevaluated based on trends in results and complaints filed during testing.
  • Any questions deemed unclear or invalid will automatically be credited toward your score.
  • Because the exam is graded largely by a machine, you should expect your Level 1 and 2 exam scores to be available for the exams within 60 days of when you took the exam.
  • Your Level 3 exam scores will likely take longer to be released due to that examination’s constructed-response component.

Constructed Response 

It's structured... it requires a great deal of planning.... the king of the answers, we have the constructed response!

  • The Level 3 exam essay portions are graded by an elite team of CFA Charter-holders who meet in Charlottesville, VA, for two weeks to grade those questions.
  • The graders are split into groups depending on their specialties, and each team will handle one specific question related to that specialty.
  • An internal system of junior graders, senior graders, and graders is set up to ensure there are no errors. This means that each essay is given as fair and level a playing field as possible.
  • Graders never see your name, your other responses, or even the grading centre where you took your test.
  • Additionally, the essays that fall in the middle 50% of the distribution of essay scores are re-graded by a different person.
  • In the next step, they assess whether or not an essay meets the expectations of the course. If the expectations of the course are being met, there is no need to grade again.
  • If the first and second scores are different, the test gets graded a third time, just to be sure.

Minimum Passing Score (MPS)

It's mysterious.... it's specific.... it's calculating, next up is minimum passing score! 

  • After each round of exams is scored, an MPS is assigned. You can’t really predict what the MPS will be since it varies every year and isn’t available to the public.
  • So how is it decided? To determine the MPS for an exam, the CFA Institute Board of Governors (The Board) thoroughly analyses each question on the exam. The Board evaluates each question for its difficulty and makes an independent judgment about how well they would expect a "just competent" candidate to perform on each question. The Board then uses these analyses to determine the minimum score expected of a competent candidate, hence the MPS.
  • By this point, the Board has already determined the exams’ numerical scores, so it becomes simply a matter of using the MPS to determine whether or not that score constitutes a passing or failing grade.
  • There are no numerical scores provided to candidates, only a score report that indicates a pass or fail.

Score Report

And the Winner is.....

  • Your score report will include a chart that shows your performance relative to the rest of the candidates who took the exam.
  • A black dotted line indicates the MPS; a thick, dark blue line your score. If the line is above the MPS, you passed. If it is below the MPS, you did not pass.
  • You will also see a light blue box that extends above and below the dark blue line representing the likely range of scores you would have achieved given favourable conditions with a 90% confidence interval.
  • For example, if the topics chosen for the exam had been a little bit more focused on your area of expertise, you could have had a higher score. On the other hand, if you weren't as prepared, you could have had a worse score. 
  • It is likely that regardless of favourable or unfavourable conditions, you would still score within that range.
  • So, if you failed, but your confidence interval overlapped with the MPS, it means you were close and would have likely passed with a little more studying.
  • But if you failed and the highest range of your confidence interval was still under the MPS, you’ll probably need to be significantly more prepared to pass the next time around.

In Conclusion: Let's Gain Some Confidence

There's no denying it: there's a lot of uncertainty surrounding your chances of passing this exam. You’re not sure what to expect, and you know you have to be prepared for the worst. You don’t know what the MPS will be, and you’ll be unable to calculate the number of questions you can afford to miss or what your margin of error can be. So how can you be confident about passing?

It's always best to rely on preparation because luck can be unstable. The best way to know you will pass the test is to study hard. It may be that you require less time than others but are more effective so don't confuse yourself with having to study as early as possible. Everyone learns different. There is no right or wrong when it comes to studying.

But we say... learn the best way to prepare by studying with a comprehensive online learning platform that's built for your success... with us! 

Our Level 1 CFA Exam prep tracks your performance, provides access to the most relevant and up-to-date information, and is tailored to your unique study preferences. That’s why when you study with us, you will have everything you need to pass with confidence and earn your CFA charter.

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