Why CAIA Level 1 Pass Rate Dropped to 45%: Exam Getting Harder?
- Dimitri Dangeros, CFA, CAIA
- Sep 19
- 4 min read
The CAIA Level 1 pass rate has plummeted from over 70% in 2006 to just 45% today—one of the lowest since 2010. But is the exam actually getting harder, or are other factors at play? Here's the data-driven analysis.
The Dramatic Decline: Numbers Don't Lie
Historical Timeline:
2006: 70%+ pass rates
2017-2024: 45-64% range
March 2025: 48% (recent data)
September 2024: 45% (current low)
7-year average: 51%
"This recent Level 1 pass rate is one of the lowest since 2010," confirming we're seeing a genuine crisis in pass rates.
Is the Exam Actually Getting Harder? CAIA Level 1 Pass Rate Dropped to 45%
Yes - The Content is More Sophisticated
Expert Verdict: "Pass rates have been on a steady decline for the past decade. More candidates are taking the exam than previously, which is one reason the pass rate is declining, but the other is that the exam is becoming more challenging."
Curriculum Evolution: The CAIA Association continually updates the curriculum to reflect the dynamic nature of alternative investments. These updates ensure that the content remains relevant but also mean that candidates must stay abreast of new developments and concepts.
2025 Curriculum Changes: Both Levels have been updated for the 2025 exam cycle, with substantial revisions including:
New readings on Infrastructure and Real Estate in Level I
Enhanced focus on deeper insights into investment strategies
Updated content reflecting latest industry practices and academic research
The Three Primary Culprits
1. Candidate Volume Explosion
The growing recognition of the CAIA designation in the finance industry has led to a surge in the number of candidates. A broader candidate base often brings a wider range of preparedness levels, which can impact overall pass rates.
Quality Dilution: More candidates taking the exam than previously means the candidate pool includes more people with varying levels of preparation and commitment.
2. Evolving Exam Complexity
"The CAIA curriculum is getting more sophisticated, and some candidates may not be using effective exam prep."
Dynamic Content: "The world of alternative investments is fluid, and it is not unusual to read that new types have been created. Also, new regulations or even deregulation can affect charterholders."
Annual Updates: The curriculum changes year-to-year to reflect industry developments, meaning candidates can't rely on outdated materials or previous knowledge.
3. Inadequate Study Preparation
"Most likely recent CAIA pass rates are so low because more candidates are enrolling in the CAIA Program, the CAIA curriculum is getting more sophisticated, and some candidates may not be using effective exam prep."
Common Mistakes:
Candidates "rely too heavily on only reading the curriculum and neglect to practice questions and take mock exams"
Underestimating the 250-300 hours recommended study time
Poor time management during preparation
What Changed: Before vs. Now
Early Years (2006-2010)
Pass Rates: 70%+
Candidate Pool: Smaller, more selective group
Curriculum: Less complex, narrower scope
Preparation: Fewer candidates meant more personalized guidance
Current Era (2017-2025)
Pass Rates: 45-51%
Candidate Pool: Massive growth in applications
Curriculum: Comprehensive, constantly updated
Preparation: Self-directed with more competition
The Pandemic Effect: Minimal Impact
Unlike other certifications, "the pandemic didn't have a noticeable improvement in CAIA pass rates, due to additional study time that comes with the postponement."
Why?: CAIA's existing computer-based testing (CBT) format and online proctoring options since September 2020 provided testing flexibility that minimized disruptions.
The Reality Check: It's Both
The answer isn't simply "harder exam" or "more candidates"—it's a combination of factors creating a perfect storm:
Exam Difficulty: ✅ YES, it's harder
More sophisticated curriculum
Regular updates reflecting industry complexity
Application-focused rather than memorization-based
Candidate Preparedness: ❌ Declining
Larger, more diverse candidate pool
Many underestimate study requirements
Inadequate use of practice materials
Market Maturation: 📈 Higher Standards
Professional credibility requires higher pass thresholds
Industry expects more from certified professionals
Competition for recognition increases standards
What This Means for 2025 Candidates
Don't Underestimate the Challenge
Reality: "Early indications from the March 2025 sitting suggest the rate will remain in the mid-40 percent range, underscoring the exam's rigor"
Preparation Must Evolve
Study Time: Full 250-300 hours (no shortcuts)
Practice Focus: "40–50% of your time practicing questions and answering techniques, and 20% of your time taking mock exams"
Current Materials: Use only 2025 curriculum—previous years won't cut it
Success Still Achievable
Despite lower pass rates, "passing CAIA exams is certainly achievable with a proper study plan to track your progress and solid study strategies."
Bottom Line
The CAIA Level 1 pass rate dropped to 45% because the exam IS getting harder while more unprepared candidates are attempting it.
The decline reflects:
Genuinely more challenging content
Higher professional standards
Larger, less prepared candidate pool
Industry maturation requiring greater expertise
For candidates: This isn't about the exam being "unfair"—it's about professional standards rising to match the sophistication of the alternative investments industry. Prepare accordingly.
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