The steady decline in the pass rate for level 1 is an indicator of a lack of understanding of the CFA curriculum concepts and material on the average candidates' part. This conclusion should not come as a surprise to most. Every exam question has only four choices, so this should make things easy, right? No, the effect is exactly the opposite. Multiple choice questions eliminate potential points for partially correct answers. It is a swim or sink scenario. The steady decline also suggests that some candidates may be more willing to rely on guesswork when answering questions on the exam. In our experience based on mock tests given over several years, candidates who randomly answer multiple choice questions, tend to score no better than 25-30% on average, exactly what the one-in-four correct choice would predict.

In order to keep the hang-man away on the results day, study the concepts thoroughly, understand them well and try to develop as many inter-linkages between them as you can. Go over difficult LOSs several times. Do as many different kinds of problems (numbers are not important, their diversity is) as is humanly possible given the demands on your time, and DO NOT rely on a guessing game strategy for the exam. The right answer is always before your eyes, but the big question is: Which one? Unfortunately there are no short cuts. As they say, there is no free lunch either, but the CFA exam may seem to extract a steeper price than some are willing to pay. They bring down the average pass rate for the entire group. There is a silver lining though: if you have worked hard and have been disciplined in your study, the overall pass rate is irrelevant for you. Your conditional probability of passing is much higher given your effort. Work on what is under your control and forget about the overall pass rate. Maintain your sanity!