CFA Institute usually makes changes to the exam curriculum each year. In 2022, there have been some updates throughout the CFA Level I curriculum. Well, here we are going to share information about CFA Level 1 Curriculum changes 2022.
CFA Level 1 Curriculum Changes 2022
In short, there have been many small updates throughout the CFA Level 1 curriculum, however nothing major overall.
Here are some notable changes:
- ESG (Environmental, social, and governance) coverage at Level 1 was updated and also expanded to cover the most recent developments and their impact on the investment management.
- The Quantitative Methods topic area in CFA Level 1 Curriculum was revised to be more engaging and friendly. Also, now it includes code snippets as well as Excel commands to support the data presentation. At this time, Level 1 ends with a new Introduction to Regression reading which focuses on investment applications.
- To straighten for ease of reading and consistency, fixed Income readings were revised across all levels.
- The Alternative Investments readings have been updated to include the new introductory reading.
Apparently, there are 60 readings in CFA Level 1 Curriculum 2022.
5 readings from 2020/2021 were deleted/removed:
- Reading 5: Global Investment Performance Standards
- Reading 7: Statistical Concepts & Market Returns
- Reading 32: Capital Budgeting
- Reading 33: Cost of Capital
- Reading 35: Working Capital Management
8 new readings were added (mostly in Quant Methods and Corporate Issuers):
- Reading 2: Organizing, Visualizing, and Describing Data
- Reading 7: Introduction to Linear Regression
- Reading 28: Uses of Capital
- Reading 29: Sources of Capital
- Reading 30: Cost of Capital (Foundational Topics)
- Reading 31: Capital Structure
- Reading 52: The Behavioral Biases of Individuals
- Reading 60: Ethics Application
16 readings were updated in the CFA level 1 curriculum.
Overall, the CFA Level 1 curriculum changes 2022 are nothing major, with 3-4 topics updated to better prepare candidates for a smoother transition to Level 2. Quant Methods, Corporate Issuers, Alternative Investments and to a small extent Ethics have notable changes from curriculum 2020/2021. Other topics remain largely the same as last year.
The CFA Level 1 Curriculum 2022 received major updates. Below we break down CFA Level 1 curriculum changes by each topic.
- Quantitative Methods
The topic area of Quantitative Methods was rewritten substantially. Two readings were new for CFA level 1 Curriculum 2022: “Organizing, Visualizing, and Describing Data” and “Introduction to Linear Regression.” The readings “Probability Concepts,” “Sampling and Estimation,” “Common Probability Distributions” and “Hypothesis Testing” underwent material revisions.
- Economics
In the topic area of Economics, the reading “Aggregate Output, Prices, and Economic Growth” was revised, replacing the IS-LM model for deriving the aggregate demand curve with an explanation of wealth, interest rate, and also exchange rate effects. A new LOS regarding credit cycles was added to the “Understanding Business Cycles.”
- Financial Statement Analysis
In the CFA Level 1 Curriculum 2022, Financial Reporting and Analysis was renamed as the Financial Statement Analysis topic. The “Non-Current Liabilities” was updated for reflecting changes in accounting standards for leases.
- Corporate Issuers
In the CFA Level 1 Curriculum 2022, Corporate Finance was renamed as the Corporate Issuers topic. The new readings such as “Uses of Capital,” “Sources of Capital,” and “Cost of Capital – Foundational Topics” replaced the old readings “Capital Budgeting,” “Working Capital Management,” and “Cost of Capital.” New reading “Capital Structure” added material to Level I which had previously been covered at Level 2.
- Fixed Income
The Fixed Income topic area in CFA Level 1 Curriculum 2022 was updated to reflect the phase-out of LIBOR as a reference rate. Also, one new LOS was added to each of the readings “Introduction to Asset-Backed Securities” and “Understanding Fixed-Income Risk and Return.”
- Alternative Investments
In the CFA Level 1 Curriculum 2022, the single reading in the Alternative Investments topic area was rewritten virtually end-to-end, adding a new material on investing methods, fee structures, and performance appraisal, and removing much of the old material regarding the valuation of alternative investments.
- Portfolio Management and Wealth Planning
You are going to find that in the Portfolio Management topic area, a new reading “The Behavioral Biases of Individuals” moved into Level I from Level 3. Also, the reading “Technical Analysis” was revised, adding material on approaches to asset allocation and deleting or removing old material on cycles, Elliott wave theory, and Fibonacci ratios.
- Ethical and Professional Standards
In the Ethical and Professional Standards topic area, you are going to find that the reading “Introduction to the Global Investment Performance Standards” replaced two old readings and also reflects the new 11th edition of GIPS. A new reading “Ethics Application” was added.
CFA Level 1 Topic Weights 2022
Apparently, there is no change to CFA level 1 topic weights 2022 compared to CFA level 1 topic weights 2021. In the year 2021, CFA Institute changed CFA Level 1’s topic weights to be a range rather than an absolute % as per previous years. Looking back to 2018-2019, there were major changes whereby Financial Reporting & Analysis and Quantitative Methods’ weightings were reduced to give a more balanced topic range. These changes probably have been done to discourage candidates from completely ignoring topics such as Derivatives and Alternative Investments for Level 1 preparations.
CFA Level 1 Topic Weights (vs. Previous Years)
| Topics / Weight | 2018 | 2019 | 2020 | 2021 | 2022 |
| Quant Methods | 12% | 10% | 10% | 8-12% | 8-12% |
| Economics | 10% | 10% | 10% | 8-12% | 8-12% |
| FRA | 20% | 15% | 15% | 13-17% | 13-17% |
| Corp Fin / Issuers | 7% | 10% | 10% | 8-12% | 8-12% |
| Equity | 10% | 11% | 11% | 10-12% | 10-12% |
| Fixed Income | 10% | 11% | 11% | 10-12% | 10-12% |
| Derivatives | 5% | 6% | 6% | 5-8% | 5-8% |
| Alt. Investments | 4% | 6% | 6% | 5-8% | 5-8% |
| Portfolio Mgmt. | 7% | 6% | 6% | 5-8% | 5-8% |
| Ethics | 15% | 15% | 15% | 15-20% | 15-20% |
Why Are Curriculum Changes and Topic Weights Crucial?
Need to note that Topic weights are key to CFA study plans, because it will guide candidates on the importance of each topic for the exams. Higher weighted topics will deserve more focus, practice and study time. Also, knowing the curriculum changes in advance is very useful in certain circumstances.
