Reflections on the Spring 2008 Actuarial Exam 3F / Exam MFE

Why Straightforward Tests Are Better Than Obscure Ones

It is the late evening of May 15, 2008, and I have just taken the most difficult exam of my life to date - the Spring 2008 Exam 3F/MFE, sponsored by the Society of Actuaries and the Casualty Actuarial Society. This is quite a claim, as I have taken some difficult exams in the past and done considerably well on them. To establish my credentials in giving these remarks, I scored 1580 on the old SAT, had three perfect SAT II scores, earned 8 marks of 5/5 on Advanced Placement exams, received 10/10 on actuarial exam 1/P and 9/10 on actuarial exam 2/FM, and been a straight-A student my entire life. In addition, I am a National Merit scholar, a mathematics/economics major, and first-place winner of two Illinois state mathematics competitions. I studied for a full three months for actuarial exam 3F/MFE and compiled a free study guide to aid other students in doing so. This study guide closely followed the required reading for the exam, R. L. McDonald's Derivatives Markets, as well as prior exam questions from both the Casualty Actuarial Society (CAS) and the Society of Actuaries (SOA). If those who oversee entry into the actuarial profession want anybody to be admitted to it, people like me should certainly be on the list.

When I sat to take the exam, however, I found a glaring discrepancy between the exam's composition and what actuarial students preparing for it had been led to expect by both the official exam syllabus and the publicly known questions from prior exams. Moreover, the exam was a departure from the manner in which McDonald's text covered the required material, and the exam's emphasis did not coincide with the emphasis placed by McDonald in his book on virtually any of the concepts on the syllabus.