CFA Level I case studies
CFA Level I · Put your knowledge to work in context.
The CFA Level I exam is the entry point to the CFA Program, the professional credential offered by CFA Institute for people building careers in investment management, research, banking, and related fields. Candidates often sit it while working full time and frequently without a finance degree, because the curriculum is built from foundations rather than assuming prior training. Level I is a multiple-choice, computer-based test that samples broadly rather than deeply. Questions are drawn from ten topic areas: ethical and professional standards, quantitative methods, economics, financial statement analysis, corporate issuers, equity investments, fixed income, derivatives, alternative investments, and portfolio management. The CFA Level I case studies are 5 cases and about 3,408 words.
1IPO Allocation, a Family Account, and a Box at the Tennis
Daniel Okafor, CFA, manages client accounts at a mid-sized asset manager. His firm's written IPO policy requires shares to be allocated pro rata across all eligible accounts in proportion to order size.
730 words, about 4 min2A Momentum Backtest That Survived Everything
A junior analyst presents a cross-sectional momentum strategy tested on 96 months of data. The mean monthly alpha is 0.45% with a t-statistic of 2.10, which she describes as 'significant at the 5% level'.
617 words, about 3 min3Capitalised Development Costs at Nordwind AG
Nordwind AG reports under IFRS. For 2024 it reports net income of EUR 200m, cash flow from operations of EUR 350m and cash flow from investing of EUR -300m.
757 words, about 4 min4Bullet or Callable in a Falling-Rate World
A portfolio manager must choose between two bonds for a one-year hold and expects yields to fall 75 basis points over that period. Bond A: non-callable, YTM 5.20%, modified duration 6.40, convexity 78.
519 words, about 3 min5The Warehouse That Is Already Paid For
A manufacturer is deciding whether to launch a new product line. Its finance VP recommends approval, citing a positive NPV.
785 words, about 4 min