Posted by: Kaplan Schweser
Published: July 28, 2020
If you are considering sitting for Level I of the CAIA® exam, you probably have questions. We’ve created this article to answer some of the most common questions we receive from people preparing to take the first step toward becoming a CAIA Charterholder. You’re always welcome to reach out to Schweser’s knowledgeable Student Support team for help as well.
CAIA is an acronym for Chartered Alternative Investment Analyst℠. Offered by CAIA Association, the CAIA Charter is recognized globally as the benchmark for analysis, application, and standards of practice in the alternative investments arena. What are alternative investments? They are investments that are not stocks, bonds, and cash. Examples include real estate, infrastructure, natural resources, commodities, hedge funds, private equity, collateralized debt obligations, and credit derivatives. Check out this article for more details.
The CAIA Charter is valued by top employers and recognized globally as the highest standard of achievement in alternative investment education. As the CAIA designation continues to grow, so do its benefits. According to Payscale, the median salary for a CAIA Charterholder in the United States is $96,000 a year. Investment analysts who hold a CAIA make about $74,197. On the top end of the scale are investment consultants, who earn an average of $139,565…
To earn the charter, you must take and pass the Level I and Level II CAIA exams. There are no degree or work requirements for taking the exams, but after you pass both, you must earn or finish earning a bachelor’s degree or equivalent and have at least 1 year of professional experience, or complete a minimum of 4 years of professional experience without a degree. You also have to join CAIA Association and submit two professional references to the association.
The Level I CAIA exam is administered over an 11-day period called a “window” twice a year, in March and September. Those who register for the exam can choose a date within the window for their exams. The Level I CAIA exam window for 2020 is August 31-September 11, 2020. Note: Normally, the exam is held in testing centers. However, to address safety concerns related to COVID-19, CAIA is offering all September exam candidates an online proctoring option. All the details are in this FAQ.
The Level I CAIA exam is 200 multiple-choice questions. The exam length is four hours. There are 100 questions in the first two hours, followed by a break, and then 100 more questions in the last two hours.
The world of alternative investments is fluid, and it is not unusual to read that new types have been created. Also, new regulations or even deregulation can affect charterholders. Therefore, the topics of the CAIA Level I exam can change from year to year. That said, CAIA Association has announced that the March and September 2020 Level I CAIA exam will cover the following subjects:
The weights of the Level I exam topics can also change from year to year. For the March 2019 and September 2019 Level I exams, topics are weighted as follows:
CAIA Association recommends that candidates spend 200 hours studying for the CAIA exam. And, you should do that over a period of a several months. Cramming in the last few weeks for the exam won’t work. The topics you’re being tested on require a type of knowledge that can only be gained over a structured, careful course of study—not last-minute, frantic reviews of core materials.
More people pass than fail the CAIA Level I exam, but not by much. It’s an intense exam. Some self-directed and motivated candidates are able to pass the CAIA exam using a course of self-study, but the majority of those who pass have taken exam prep classes or signed up for an exam prep package.
The CAIA exam pass rate for Level I is estimated to be about 60%. However, only 40% of candidates who begin the program actually earn the charter. You can greatly improve your odds of success by learning from other candidates’ experiences and avoiding common study mistakes.
The fee for Level I ranges from $1,150 to $1,250, based on the exam registration period. If you want to retake the exam, the fee is $450.