Peter13 wrote:
There are some things that the institute will not make public.
But, they are telling you that the MPS is designed to have a minimally competent candidate pass. They’ve made it public, and they’ve told you the methodology (modified angoff method, if I recall).
Peter13 wrote:If over 50% of the candidates all scored above 65% on the exam it is highly unlikely that you would see the pass rate above 50%, its part of mainitining the quality of the qualification (which you would never know hence the reason why you only see a broad range of your performance).
I agree it isn’t likely that an unusually high percentage of candidates would pass, but mainly because the average preparedness of the candidate pool isn’t likely to fluctuate much from year to year (which could also be suggested by a slight fluctuation in the pass rate from year to year). Also, why would a low pass rate necessitate a high quality charter? It could quite easily be due to underprepared candidates taking the exam. Just look on this forum how many people pop up around exam time saying they haven’t prepared, and that they will just take the exam anyway. Imagine how many people
beyond this forum do that as well. Think of people who have finance/accounting degrees and they decide to blow off studying because they think it’s a lock for them (I knew people like this, and some of them failed). There is also a tiny, tiny filter (aside from money, a degree or something like that) to sit for a CFA exam. There are many reasons why that pass rate can be low, all of which seem reasonable (and don’t contradict the official statement provided by the Institute).
Peter13 wrote:Hence, the MPS would be slightly raised to say 68% for example, and this is one factor, or “variable” as they mention, that is taken into account when setting the MPS along with their other assessments and evaluations they make
True, they did say that during a second round of evaluation, they take into account the actual examinee performance on a question. However, they are doing so under the guidance of a standard setting methodology that is designed to objectively distinguish those who are
minimally competent from those that are not. The methodology is not geared towards maintaining a pass rate…which would be quite easy, but is usually quite different than determining if someone is competent.
Peter13 wrote
therwise, logically speaking you would see the pass rates fluctuate a lot from year to year, but that does not happen, and in recent years it stays consistently in the low to mid 40s.
The pass rates could also remain constant within a range due to the fact that the candidate pool is, more or less, equal in preparedness in comparison to other years (which seems fairly reasonable, unless you have a surge in candidate number [or some other shock] from year to year). It’s much easier to conclude that the examinees are about equal in competency from year to year, which leads to a roughly-constant pass rate, rather than concluding that the CFA Institute is blatantly manipulating the MPS outside the guidelines and methodology they’ve said they follow.
This might provide some more insight on the methodology they’ve chosen (and the general idea of standard setting).
https://en.wikipedia.org/wiki/Standard-setting_study