CAIA Level 1

CAIA Level 1

The CAIA Level 1 exam is the first part of the 2 exam structure of the Chartered alternative investment analyst (CAIA) process. The CAIA level 1 examination is divided into the two broad sections of quantitative methods and an introduction to alternative investments. Candidates study the application of basic analytical tools, as well as the fundamentals of alternative investment vehicles. Candidates learn to differentiate between the various AI trading strategies and performance measurements. Candidates are assumed to have a basic understanding of the concepts of traditional finance.

The CAIA Level 1 exam consists of 200 multiple choice questions. There are two sections of 100 questions each which candidates are allowed 2 hours for each section to complete the questions. There is an optional 30 minute break between sections one and two. Both sections cover quantitative methods, professional standards and foundations of alternative investments and include such topics as alternative investment asset classes, trading strategies, sources of returns to these asset classes and strategies, and background on legal aspects of alternative investments. The CAIA level 1 exam is offered semi-annually in March and December of each year. The window for each testing period is 10 business days, during which time candidates are responsible for sitting for the exam at one of the proctored testing centers. There are no exemptions for any parts of the CAIA Level 1 or Level 2 exams.

A candidate for the CAIA Level 1 examination is recommended to purchase 4 separate text books in additional to the provided CAIA study guide. The curriculum is based upon a combination of information from the readings/text books as well as the CAIA study guide. The exam registration fee does not include the cost of the curriculum readings and candidates remain responsible for covering all expenses associated with the purchase of the readings. Based upon candidate feedback, the CAIA recommends the “typical” candidate will spend a minimum of 150-200 hours of study for the CAIA Level 1 exam. There are also many available preparatory programs available to CAIA candidates in addition to the reading material.

Although all formulas listed in the study guide will be available as an exhibit during the exam (a pop-up window) a calculator is recommended by the CAIA. The CAIA Association allows candidates to bring into the examination the TI BA II Plus (as well as the Professional model) or the HP 12C (as well as the Platinum edition). No other calculators are permitted.

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