Day 7: CFA Level I Quant Study Plan: Probability Foundations - 90 days Plan

 Day 7 continues the Quantitative Methods block. After working on descriptive statistics, today’s focus is probability: how to think about uncertainty, possible outcomes, and expected results.

This is a study-plan blog post, not official CFA curriculum material. Use it to organize your preparation, then rely on your CFA materials, notes, or question bank for the actual readings and practice questions.

Checklist

Spend 10-15 minutes preparing your study setup as usual.

• Workspace: Open one clean page titled “Probability Foundations.”
• Materials: Keep your formula sheet, calculator, question bank, and notebook ready.
• Formula focus: Mark formulas for probability rules, conditional probability, expected value, variance, and standard deviation.
• Flash Cards: Keep them at hand or ready to be filled up
• Visual setup: Keep space for probability trees, two-way tables, and simple outcome grids.
• Question bank filter: Select Quant questions tagged probability, expected value, conditional probability, and joint probability.
• Time block: Plan 45 minutes for study, 35 minutes for practice, and 15 minutes for review, at least. 2.5-3 hrs is a better block

Today’s goal is to understand how probabilities combine, not just memorize formulas.

Daily Ethics reading and prep

Spend 10 minutes on Ethics before the Quant block.

Today’s Ethics focus: reasonable basis and probability-based claims.

Read one short scenario where an analyst makes a forecast or probability-based recommendation. Ask yourself:

• Is the forecast supported by reasonable analysis?
• Are assumptions clearly explained?
• Is the analyst overstating certainty?
• Are risks disclosed?
• Could the client misunderstand the probability statement?

Then complete 5 quick Ethics questions or flashcards. If you miss one, classify it mainly as a Concept gap or Reading error.

Main study block

Today’s Quantitative Methods focus is probability foundations.

Study these subtopics:

• Basic probability: The chance that an event occurs.
• Mutually exclusive events: Events that cannot happen at the same time.
• Independent events: Events where one outcome does not affect the other.
• Conditional probability: The probability of one event given that another event has occurred.
• Joint probability: The probability that two events occur together.
• Addition rule: Used when combining probabilities of events.
• Multiplication rule: Used when finding joint probabilities.
• Expected value: The probability-weighted average outcome.
• Variance and standard deviation of outcomes: Measures of uncertainty around expected value.

A useful habit today: write the event labels clearly. Many probability mistakes happen because A, B, , , and  get mixed up.

25-question practice target

Complete 25 questions today.

Use this breakdown to begin with:

4 questions: Basic probability and event definitions
4 questions: Mutually exclusive versus independent events
4 questions: Conditional probability
3 questions: Joint probability and multiplication rule
3 questions: Addition rule and combined probabilities
2 questions: Expected value and probability-weighted outcomes
5 questions: Ethics warm-up on forecasts, reasonable basis, and disclosure

For each Quant question, write down what is given and what is being asked before solving. Probability is easier when the setup is clean.

Mistake-log prompt

After practice, log every missed or guessed question using these four labels:

• Concept gap: I did not understand the probability rule or event relationship.
• Formula gap: I understood the concept but used the wrong formula or setup.
• Calculator error: I made an arithmetic error or entered probability values incorrectly.
• Reading error: I misunderstood the wording, especially “given,” “and,” “or,” “at least,” or “mutually exclusive.”

For Ethics mistakes, use mainly Concept gap or Reading error.

Five-question review checkpoint

End the session by answering these five questions:

1. Can I explain the difference between mutually exclusive and independent events?
2. What does conditional probability mean in plain language?
3. Did I confuse “and” with “or” in any practice question?
4. What was my accuracy on the 20 Quant questions and 5 Ethics questions?
5. Which probability rule should I review tomorrow before moving forward?

     Day 8 will continue Quantitative Methods with probability distributions, normal distribution intuition, expected value, variance, and interpretation.