A final-revision summary for CFA Level II. Study aid only — no notes in the proctored exam (an approved calculator is permitted).
The format
Vignette (item set) based: read a case, answer the linked multiple-choice questions. Read the case carefully — details often decide the answer.
Core valuation models to know
| Model | Idea |
|---|---|
| Dividend discount model (DDM) | Value = present value of expected dividends |
| Gordon growth | Value = D₁ ÷ (r − g) |
| FCFF / FCFE | Value from free cash flow to the firm / to equity |
| Multiples | Relative value via P/E, EV/EBITDA and peers |
| Bond with option | Value = option-free bond ± the embedded option |
| Residual income | Value = book value + present value of residual income |
The Code and Standards (ethics)
Seven Standards of Professional Conduct: Professionalism; Integrity of Capital Markets; Duties to Clients; Duties to Employers; Investment Analysis and Recommendations; Conflicts of Interest; Responsibilities as a CFA Member/Candidate.
Exam-day reminders
Two sessions of item sets · read every vignette carefully · master the approved calculator · ethics can decide a borderline result · manage time per item set.