CFA Level 1
Build the foundation for the CFA programme with a structured introduction to the ten core areas of investment analysis, from quantitative methods and economics to portfolio construction and ethical standards.
Learning Objectives
5 objectivesExplain the core concepts of quantitative methods, economics and corporate finance used in investment analysis.
Read and interpret financial statements as the basis for analysing a company.
Describe how equity, fixed income, derivative and alternative investments work and how they are valued.
Describe the principles of portfolio construction and the relationship between risk and return.
Recognise the ethical and professional standards that apply to investment professionals.
Programme Outline
10 topicsQuantitative Methods
Returns and the time value of money, the statistical features and distributions of asset returns, estimation and hypothesis testing, simple linear regression, and an introduction to financial data science.
Economics
Firms and market structures, business cycles, fiscal and monetary policy, geopolitics, international trade, and how capital flows and exchange rates link economies.
Corporate Finance
How companies are organised, owned and governed, and how they manage working capital, capital investment and capital structure.
Financial Statement Analysis
Reading the income statement, balance sheet and cash flow statement, the main accounting areas behind them, and how to judge the quality of financial reporting.
Equity Investments
How equities are issued, traded and rewarded, and the basic valuation approaches: discounted cash flow, relative value, and industry and company analysis.
Fixed Income
Bond features, issuance and markets, pricing and yields, interest rate risk through duration and convexity, credit analysis and securitisation.
Derivatives
Forwards, futures, swaps and options: how they work, what they are used for, and the basic principles for pricing and valuing them.
Alternative Investments
Private capital, real estate, infrastructure, natural resources and hedge funds, how their returns are measured, and an introduction to digital assets.
Portfolio Construction
Portfolio risk and return, the portfolio management process and planning, the behavioural biases of individuals, and an introduction to risk management.
Ethical and Professional Standards
Ethics and trust in the investment profession, and the CFA Institute Code of Ethics and the seven Standards of Professional Conduct.
Hands-On Resources
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