How Hard Is HKSI Paper 1? Pass Rate Explained

Paper 1 is the hardest of the three entry papers by pass rate. Knowing why helps you plan: candidates rarely fail on one impossible topic. They fail because they drop a few marks in every topic, and the 70% pass mark leaves little room for that.

The pass rate

HKSI Institute publishes monthly pass rates for each Licensing Examination paper. Averaged over September 2025 to August 2026, the figures were:

Roughly one Paper 1 candidate in two fails, against about one in three on Papers 7 and 8. Many Paper 1 candidates are new graduates or career changers sitting their first regulatory exam, which pulls the average down, but the gap is consistent enough to take seriously. Check the latest month on hksi.org.

Why Paper 1 catches people out

It is wide. The syllabus (version 35, effective 30 June 2026) runs across nine topics, and Topic 3 alone walks through the Securities and Futures Ordinance (Cap. 571) from Part I to Part XVII. Add the Companies Ordinance, the subsidiary rules, the SFC codes, AML law, exchange practice, listing and takeovers, and market misconduct.

It is figure-dense. Many questions turn on one number or one time limit: more than 10% versus 5%, 7 business days before versus after, 10 CPT hours versus 12. A candidate who knows the rule in outline but not the figure picks the distractor.

It is partly applied. HKSI’s own preparation guidance says the questions test recall, understanding, problem solving and comparing ideas. Most items ask for a rule directly, but about one in five in HKSI’s published sample is a short scenario: a named firm, a named client, a set of facts, and a question that needs the rule applied.

Statement questions punish half-knowledge. In the I, II, III, IV format, knowing three statements well is not enough if the fourth decides between two options.

The margin is thin. At 70%, you can afford 18 wrong answers out of 60. Spread evenly, that is two per topic.

Where the marks are won and lost

HKSI does not publish topic weightings for Paper 1. From the syllabus and the way rules stack, these areas carry the most testable detail:

• Licensing (Topics 3 and 4). Regulated activity types, responsible officer rules, provisional and temporary licences, notifications, the Financial Resources Rules and client money. See the licensing note.
• The Code of Conduct (Topic 5). Know your client, suitability, complex products, professional investors and discretionary accounts. See business conduct.
• Market misconduct (Topic 9). Six civil forms, their criminal twins, and who hears what. See market misconduct.
• Company law (Topic 2). Easy marks if you learn the numbers: 75% for a special resolution, 21 days’ notice for an AGM, one month to register a charge (Companies Ordinance, Cap. 622, ss.564, 571 and 335).

Candidates tend to lose marks on the topics they skim because they feel familiar: the regulatory overview and exchange practice. These are short, factual and quick to score once learned.

What candidates who pass first time do differently

• They learn each figure with the rule and the source, not as a free-floating number.
• They practise applied questions by topic before attempting full mocks.
• They keep an error log and re-test only what they got wrong.
• They sit at least two full timed mocks and score above 80% before the real exam.

Our study method sets this out step by step, and the 10 common traps shows the figures that cost the most marks. To see where you stand today, sit the free mock.

HKSI Prep is an independent study tool, not affiliated with or endorsed by HKSI Institute or the SFC. Pass rates are HKSI’s published figures; check hksi.org for the latest.