CFA® Charterholder Career Information

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Is the CFA®Worth It?

You might be asking yourself if the CFA charter is worth it because you heard the CFA Program is expensive and it takes a long time to become a CFA charterholder.  Or perhaps you’re considering switching careers and looking for information about what you’d be getting yourself into.   

In this article, we provide the necessary context to help you decide if the CFA is right for you.  Our goal is to help you set expectations about the outcomes for CFA charterholders and provide you with options in case you decide that the CFA charter is not right for you at this time.  

TABLE OF CONTENTS:

Factors To Consider If The CFA Is Worth It

Typically, the CFA Program is finished by people with backgrounds in finance, accounting, economics, or business. Having a financial background is not necessary to pursue the CFA charter; however, you will need 4,000 hours of “professional work experience” completed in a minimum of 36 months in areas like trading, corporate finance, and economics to become a CFA Charterholder. 

Each person will have their own set of personal factors to consider when deciding if the CFA charter is right for them. Information about those factors usually requires more context than what is provided in CFA FAQs

Career Goals

Upfront, you should understand that the CFA charter can indeed help you in your career, but it’s not the silver bullet for success. You are the secret to your success, and the CFA charter is just one part of that.

In our research and conversations with CFA charterholders over the years, we’ve learned an important fact: Charterholders who landed new finance jobs or moved up in their organizations applied passion, dedication, determination, and other common CFA traits to their job search or upward career move. In other words, they didn’t stop working hard after they passed the CFA exams. They also did not set the bar too high in their job search or in their desire for a better position. Instead, they did their homework on the types of jobs where a CFA charter is more likely to be respected and designed a long-term plan for working hard and moving into management.

For example, if you are a student you could use your journey through the CFA Program to get an internship or an entry-level position to start gaining the experience needed to officially become a CFA charterholder.

If you’re already working in the financial industry, we’ve seen success come to those who applied for positions or promotions where the charter is seen as advantageous. According to CFA Institute, 22% of CFA charterholders are employed as portfolio managers.

Again, you are the secret to your success. Other things you can do to help your career are: 

  • Leveraging personal contacts
  • Joining a CFA society
  • Network on social media
  • Attend events related to your career aspirations to meet possible employers
  • Sharpen your presentation skills
  • Practice interviewing
  • Try not to get discouraged along the way

Finding the Time to Pursue the CFA

Honestly thinking about how much free time you have to dedicate to the CFA Program should be a priority for you. Some important information to consider if you don’t have lots of free time should be:

  • CFA Level I exams are usually only offered four times per year
  • You can only take an exam twice per calendar year
  • You can’t fail the Level I exam and then re-enroll into the next immediate exam window
  • Average CFA candidates can spend more than 300 hours studying for each CFA exam
  • You should expect to spend three to four years completing the CFA program.

Salary Expectations

Determining how much money you can expect to earn after passing all three CFA exams is difficult to determine. If you earn the CFA designation as a mid-level analyst, it's fair to expect a 15-20% increase in salary. In reality, the CFA designation seems to provide more experienced analysts and managers with a larger salary increase. Again there are many factors that determine salary increases but one thing for sure is that the CFA designation is seen as valuable, especially for candidates in senior roles like risk, investment, and portfolio managers.   

For example, if your end goal is to become a portfolio manager at a top firm, the CFA Institute determined in a 2019 compensation study that US$177,000 was a typical total compensation amount.

According to the U.S Bureau of Labor Statistics, the annual median pay for financial analysts in the U.S is 83,660 USD or ₹570,063 in the Bangalore, India Area according to Glassdoor.

Average salary range for common CFA charterholder jobs »

Total Cost to Pursue the CFA

The CFA Program is not free and there are multiple components that determine the total cost to pursue the CFA such as:

Depending on when you register for each exam and how much you pay for CFA prep, expect to need 3-6,000 USD to pursue the CFA charter.

Total CFA exam fees » 

Is the CFA Right for You?

Try our short quiz to see if the CFA charter is right for you at this time.

What CFA Candidates Learn

The CFA Program is a three-part exam that tests the fundamentals of investment tools, valuing assets, portfolio management, and wealth planning.

CFA candidates learn more than just the CFA Insitute’s Candidate Body of Knowledge (CBOK) which covers topics like the effects of geopolitics on economies and investment markets, or environmental and social risk factors for corporate issuers.  

You will also learn about the financial community in your area and the impact your local CFA Society is having on the future of financial professionals like the global CFA Institute Research Challenge.

What a CFA Does

A CFA is a chartered financial analyst who provides investment guidance and portfolio management for individuals, businesses, and other organizations. These professionals can work at institutional investment firms, broker-dealers, insurance companies, pension funds, banks, and universities.

The CFA designation is only given to investment professionals who have completed the requirements set by the CFA Institute. CFA members can be found at some of the world's largest investment institutions, including JPMorgan Chase, Morgan Stanley Wealth Management, Royal Bank of Canada, BofA Securities, UBS Group, HSBC Holdings, Wells Fargo and Company, PricewaterhouseCoopers, BlackRock, and TD Bank Financial Group.

Using the CFA To Switch Careers

It is possible to use your pursuit and ultimate completion of the CFA Program as a way to switch careers.  If you set realistic expectations about how long the transition will take and how much effort and dedication it takes to switch careers, the CFA Program is a great way to transition into a finance professional.  Especially if your focus is narrow and you are considering positions like:

Reasons People Decide To Become a CFA »

If you don’t have any experience in the finance industry, you could look for an entry-level position after passing the level I exam while gaining experience during the rest of your time in the CFA Program.  This will help you meet the 4,000 hours of relevant work experience needed for your CFA membership.

CFA Alternatives

Some CFA alternatives we commonly see people consider are:

Advice From CFA Charterholders

We checked numerous forums and blogs, and those who said the CFA charter was worth it outnumbered the naysayers about 8:1.

One CFA charterholder wrote this in a LinkedIn blog post: “I went from zero to hero in terms of finance knowledge education, moved to Canada, and am now employed as a research analyst in a macro-boutique firm. How much of this is attributed to my status as CFA candidate? A fair portion, I would say. Would I be in the equivalent or better position without doing the CFA Program? In my thinking, it is unlikely to be the case.”

In a Life on the Buy-Side article, Mike Moran, CFA, said, “Successfully completing the program and earning your charter is a worthwhile endeavor. You never know what future the markets might hold for you, so the CFA Program offers a good base of knowledge to get you on your way.”

The general consensus of most CFA charterholders is that it has paid off in terms of career, knowledge, satisfaction, and end results. For example, when we were preparing our eBook, Before You Decide to Sit for the CFA Exam, we interviewed several CFA charterholders, including Jason A. Smith, CFA. He said, “If you are willing to pay the cost, the rewards will wait for you at the end.”

Ready to Tackle the CFA Charter?

If you’re excited about what the future could hold for you as a CFA charterholder, get started today and explore our CFA Level I study materials.

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Posted by Kaplan Schweser - March 22, 2022
Is The CFA Charter Worth It

How to Become a Financial Analyst

If analyzing data trends and the performance of stocks and bonds to help businesses or individuals make investment decisions are appealing to you, a career as a financial analyst may be your calling. 

TABLE OF CONTENTS:

What is a Financial Analyst?

A financial analyst is someone who interprets financial data and uses the results from their analysis to help businesses or organizations make decisions about investments.  Those investments can be in many different areas such as:

  • Stocks
  • Bonds
  • Real Estate
  • Business Operations
  • Franchise Performance

In their research, they usually combine multiple data sets to make predictions. For example, a financial analyst at an investment firm may combine economic variables like the unemployment rate and a company's growth potential to make predictions about buying or selling company stock.

Required Skills to Become a Financial Analyst

The skills required to become a financial analyst are broad and can depend on the industry your employer is in and the specific job duties for the role.  Common skills needed to become a financial analyst include:

  • Analysis skills
  • Communication skills
  • Financial modeling skills
  • Knowledge of enterprise resource planning software like SAP
  • Multitasking skills
  • Understanding of financial law like the Sarbanes-Oxley Act

Financial Analyst Education

Financial analysts usually have a bachelor’s degree in accounting, finance, statistics, economics, business administration, or other related fields such as math, biology, or engineering. Some high-profile positions may require a master's degree.

Masters of Science Degree in Financial Analysis

Sometimes, financial analysts want to distinguish themselves with an advanced degree while pursuing the CFA charter.  The College of Financial Planning has an Online Masters of Science in Financial Analysis program that is aligned to the learning outcomes of the CFA Institute’s CFA Program, which allows for students to earn an MSFA while simultaneously preparing for the CFA exam.

Certifications for Financial Analysts

If you don’t have the typical educational background of a financial analyst you could consider getting a certification to help demonstrate your knowledge and eagerness to work as a financial analyst. 

The most common credential financial analysts pursue is the CFA designation.  The CFA designation is one of the highest distinctions in the investment management profession.  It is given to those that finish the CFA Program and meet the work experience requirements.  

How to become a CFA Charerholder »

Other common certifications amongst financial analysts include:

Financial Analyst Career Paths

There are a few different directions you can take in a financial analyst career, including a buy-side analyst or a sell-side analyst. 

Buy-side analysts work for hedge funds or insurance companies to help businesses with their investment strategies. Sell-side analysts advise financial service sales agents who sell stocks, bonds, and other investments.

Financial analysts may also work for local and regional banks, real estate investment brokerages, and tech companies.

Obtaining a master’s of business administration (MBA) with a finance emphasis is another common route for financial analysts. You may find that many finance employers require a master’s degree for permanent and advanced positions. Getting your MBA will make you more attractive to employers and allow you more mobility in your career.

Sell-Side vs Buy-Side: Key Differences To Know »

Alternative Career Paths For Those Interested in Becoming a Financial Analyst

For those that are interested in learning about other roles in the financial industry that use similar skills consider investigating stock equity analysts and investment banking analysts. 

Stock Equity Analyst

Stock analysts (often referred to as equity analysts) work in both buy-side and sell-side firms producing research reports, projections, and recommendations about stocks and companies.

How to become a stock equity analyst »

Investment Banking Analysts

An investment banking analyst evaluates and researches investment opportunities with the aim of finding the investment that best meets the goals of their corporate clients. Investment banking analysts assess opportunities and recommend investments based on client needs and goals. They are usually part of an investment team and are likely to report to an investment banker who will ultimately guide clients to their final decision.

How to become an investment banking analyst »

US Financial Analyst Salary Ranges

The median salary for a financial analyst in the US is $83,660 USD annually, which is $40.22 per hour. The highest-paid financial analysts can earn $112,460 while the lowest-paid financial analysts can earn $63,670 annually according to the U.S. Bureau of Labor Statistics. 

Financial Analyst Job Outlook in the US

The job outlook for financial analysts in the US is positive. According to the U.S. Bureau of Labor Statistics, the number of individuals employed as financial analysts is projected to grow 6 percent from 2020 to 2030 (492,100 vs 523,400 positions).  

Over 40,000 new positions are projected to open up each year on average.  It is expected that these open positions will be created to support new financial products from big data and tech companies.  They will also help companies conduct analyses on new investment opportunities from emerging markets. 

Why Become a Financial Analyst?

Becoming a financial analyst can give you a high-paying salary with the ability to earn bonuses and share-based compensation. Financial analysts have a median annual salary of $83,660, far above the median annual salary of a full-time worker in the US which is just over $50,000 according to the U.S. Bureau of Labor Statistics. 

The position is also popular with people interested in big data and seeing a direct business impact from their decisions. 

Steps to Becoming a Financial Analyst

Here are the four big steps we recommend you take to successfully become a financial analyst.

Step 1 to Becoming a Financial Analyst: Earn a Bachelor’s Degree

If you are currently enrolled in college and working toward your bachelor’s degree, you are already on your way to a financial analyst career. Most practicing financial analysts pursued a finance-related major like accounting, statistics, or economics; however, that is not necessarily a prerequisite. 

Other math-heavy fields like engineering and physics are not uncommon backgrounds among financial analysts. It is recommended that you take courses in business, economics, accounting, and math in your undergraduate program, as they will be necessary for this career.

Step 2 to Becoming a Financial Analyst: Complete an Internship

While this is not mandatory, it is strongly encouraged that you pursue a financial analyst internship. This is especially true if you decide to pursue a credential like the CFA. An internship that qualifies as relevant work experience will count towards the 4,000-hour work experience requirement for the CFA charter. 

Completing an internship in the finance industry will help you get a realistic picture of the career and understand the type of work you can expect on a day-to-day basis in this field. Internships also give you an opportunity to network with existing financial analysts and potentially find a mentor. Some of the relationships you form as an intern will help you throughout your career. 

An internship will also help you build your resume and provide experiences you can draw on for job interviews. Most employers prefer to hire people with experience, even for entry-level jobs. An internship also allows you to demonstrate your active interest in becoming a financial analyst and build experience.

Step 3 to Becoming a Financial Analyst: Find a Job

Once you graduate with a bachelor’s degree in a relevant field, you can pursue job openings for titles like a junior financial analyst or entry-level financial analyst. Positions like these are often under the guidance of a senior analyst who will help show you the ropes of the industry. 

In these roles, you will encounter tasks like analyzing income statements, maintaining files, processing financial statements for clients, and analyzing plans and forecasts. While junior analysts could potentially advance, progression often requires either a certification or a master’s degree eventually.

Step 4 to Becoming a Financial Analyst: Get Certified/Licensed

If you want to stay in the financial analyst field, many employers will require you to get the CFA charter for senior-level positions. The CFA charter is the most prestigious designation a financial analyst can obtain. The charter program requires you to pass three rigorous exams:

  1. CFA Level I
  2. CFA Level II 
  3. CFA Level III

It is recommended that you study at least 300 hours for each of the exams, so pursuing the CFA charter is not something to be taken lightly. However, it will qualify you for many advanced financial analyst roles. 

In addition to passing the exams, you will also need 4,000 hours of relevant experience for earning the charter. Getting experience prior to beginning the CFA Program will ensure you meet the experience requirement by the time you pass Level III.

What Kind of Job Can You Get After Passing the Level I CFA Exam? »

Depending on your role, some employers may also require you to get licensing from the Financial Industry Regulatory Authority (FINRA). This type of licensure generally requires sponsorship from your employer, so it is best to start a job first and find out what they require.
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Posted by Kaplan Schweser - March 22, 2022
How to become a financial analyst

What Kind of Job Can You Get After Passing the Level I CFA® Exam?

After months of studying, reviewing, hard work, and probably some nervousness, you’ve passed Level I of the CFA® exam. Now that you’ve conquered this first milestone, you might be wondering if it can help you in your career. If you’re in the final year of earning your bachelor’s degree, perhaps you’re wondering if passing Level I can open doors for you in your job search. Or, if you’re already working in finance, maybe you think it could help you get a better role. This article has the answers for you.

Jobs Commonly Held by Those Who Passed Level I of the CFA® Exam

In 2016, an online job search company, eFinancialCareers, analyzed the resumes in their database to see what job roles candidates who had passed the different levels of the CFA exam held. Despite the fact that 37% of the resumes were not specific enough to make a determination of the role, they were able to identify ten roles. Here are their top five findings:

  • Asset management: 15%
  • Accounting and finance: 13%
  • Equities: 8%
  • Risk management: 6%
  • Interns at finance firms: 6%

Based on these numbers, if you’ve passed Level I, the job roles most likely available to you are intern, accountant or assistant accounting manager, investment administrator, fund analyst, investment product analyst, and junior equity research analyst (which is often the first step toward getting into asset management as a career).

What Is the Salary For a CFA Level I Completed Candidate?

The salary you earn after passing Level I of the CFA exam is dependent on your current job responsibilities and employer.  You do not automatically qualify for a salary increase by passing the CFA level I exam unless that was agreed upon between you and your employer. 

CFA Charterholder Salary »

Do People Get Jobs After Passing Level I of the CFA?

Before you start envisioning your new career as an asset manager or risk manager because of your Level I credentials, there are a few things you should keep in mind. Yes, those job prospects look good, especially if you don’t have one yet. But the problem with them is that there is no information in the statistics that shows whether passing Level 1 of the CFA exam made any impact during the hiring. And if you search forums like analystforum.com, Quora, and Reddit to learn whether passing Level I helped anyone get a job, you’ll get a mixed bag of responses.

Some will declare that passing Level I won’t help you at all. Others say passing Level I  can help you get a good finance job with a competitive salary in some parts of the world, but not everywhere. And, there are still others who say it absolutely helped them in their careers in one of two ways:

  • Passing Level I was a deciding factor when they were competing with someone who was equally qualified for the position but hadn’t passed.
  • They had already held careers in finance when they passed Level I.

Why are there so many different opinions? The answer to that question depends on how the forum posters approached job hunting after they passed. Quite a few job candidates think that passing Level I should be enough to get them their dream job. They’re looking for a shortcut on a career journey that is competitive and requires hard work. They are the ones who will tell you that passing the exam didn’t help. If you take the same approach, you are likely to be disappointed.

Those who say they were able to get a good job at a finance firm after passing Level I had a different view of how to leverage this accomplishment.

How Passing Level I of the CFA® Exam Can Help in Your Career Search

Those who have successfully found employment in a finance capacity after passing Level I applied the same determination to their job search as they did to studying and passing. They parlayed the techniques they used to create a CFA study plan, stick to that plan, learn the material, and stay calm on exam day to finding a job.

They networked, used personal contacts, joined a CFA society, spent hours on social media, and attended career fairs. They honed their presentation skills, worked on portraying a specific image or showcasing a specialized skill, and didn’t let themselves get discouraged. With concerted effort, this could be you. You can also use the fact that you passed as a confidence builder when going into an interview. After all, passing Level I means you have a good grasp of basic financial concepts, and that is something for which you can be proud.

Interested in more advice from CFA® charterholders? Download this free Before You Decide to Sit for the CFA Exam eBook.

Career Opportunities for CFA Level I Completed Candidates

The general consensus is that you can only get so far in a finance career if you don’t continue pursuing the CFA charter. In the eFinancialCareers research, the odds of moving up the ladder in asset management firms and corporate banks increased with each level passed, culminating in good prospects for CFA charterholders.

Those who found good entry-level jobs or gained a better position after passing Level I all said that it helped them even more if they showed they were willing to continue pursuing the charter. Some even said that it was better to put that you were a Level II candidate on your resume than to say you passed Level I. They told stories about how firms viewed the fact that they were registered for Level II very positively.

Although being a CFA charterholder doesn’t guarantee you a job, you are much more likely to advance in your career or find the perfect finance job if you’ve earned your charter.

Ready to Tackle Level II of the CFA® Exam?

If you’re excited about demonstrating your commitment to earning the CFA charter to a potential or current employer, why not get started today? Find answers to frequently asked questions about the CFA exam, or explore our CFA Level II study package options.

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Posted by Kaplan Schweser - February 21, 2022
What kind of job can you get after passing the Level I CFA exam

How to Show CFA® Designation on Your Resume

Earning the CFA designation is a great accomplishment and is an indication of your hard work and dedication to advance your career as a financial professional. You should be proud of yourself, and understand the rules and guidelines set by the CFA Institute when communicating your Chartered Financial Analyst® status on resumes, in social media profiles, and in other types of written communications.

TABLE OF CONTENTS:

Resume Rules for CFA Marks

Deciding if you should use CFA® or Chartered Financial Analyst® or knowing when to use the ® symbol can be confusing, especially if you recently earned your CFA designation and want to add this information to your resume.   

Choosing to use CFA® or Chartered Financial Analyst® is up to you.  If you have room for it, go for Chartered Financial Analyst®.  If you don’t have room for an extra three words or prefer a shortened version use CFA®.

The first and most prominent use of CFA or Chartered Financial Analyst in text material should include the registered trademark symbol ®. It is not necessary to use the ® symbol when the marks directly follow the name of a specific individual but for resumes and cover letters you should use ® after CFA or Chartered Financial Analyst because your name is usually the most prominent text on a resume or cover letter. 

If you add CFA® or Chartered Financial Analyst® to the education or certification sections of your resume or a detail section in your cover letter, they should be used as an adjective instead of a noun.  One way to remember this is the sentence should still make sense if you remove CFA or Chartered Financial Analyst.

Resume Rules for Active CFA Charterholders

If you are an active CFA charterholder in good standing with the CFA Institute, the guidelines for including your CFA designation in your resume are pretty straightforward.  

  • You can include the CFA designation after your name on your resume. For example: “ John Smith, CFA” excluding the ® symbol.
  • You can include your CFA designation in the certification or education sections of your resume and must include the ® symbol.  For example: “CFA® charterholder, CFA Institute.”
  • You may also include the date you earned your CFA designation in the certification or education sections of your resume.

Resume Rules for Lapsed CFA Charterholders

If you are no longer a CFA charterholder but still in the job market and want to show that you were once a CFA charterholder on your resume, you can.   The CFA Institute will only allow you to keep the CFA designation in the certification section of your resume as long as you specify the dates you were an active CFA charterholder in your resume and include the ® symbol.  For example: “CFA® charterholder, 20XX - 20XX.”  

Resume Rules for CFA Program Candidates

Are you currently a candidate in the CFA program and want your resume to reflect your initial commitment to earning the CFA designation? If so, the CFA Institute has a few guidelines for you to follow.  Remember that Ethics and Professional Standards are an important aspect of your career as a CFA charterholder so be transparent about where you are at in the process.  

  • You can insert information about your involvement in the CFA Program in the education section of your resume only and you must include the ® symbol.  For example: “CFA® Program participant, CFA Institute.”
  • In the education section of your resume, you can also include which level you can complete and the date of completion.  For example: “Completed Level II in 20XX.” 
  • You may only use the term “candidate” if you are actively registered for an upcoming CFA exam. 

Can you write attempted CFA Level I on your resume?

If you attempted the CFA Level I exam and failed, you should not include that information on your resume.  Most CFA candidates fail at least one exam during their CFA charterholder journey.  We suggest you try again and consider a Kaplan Schweser Level I exam prep package to help you study for the Level I CFA exam.

Can you share CFA designation on social media?

Yes, you can share your CFA designation on social media but the CFA Institute has set different guidelines for various platforms.  If you plan to advertise that you are a CFA charterholder on social media make sure you continue to meet the membership requirements set by the CFA Institute.  It is also important to remember that you should not try to falsify any information and be transparent about your status whether that is a candidate or a CFA charterholder. 

How to share on LinkedIn for CFA Charterholders

If you are a CFA Charterholder with an active membership with the CFA Institute you may advertise your CFA designation on LinkedIn. 

To add your CFA designation on LinkedIn follow these steps:

  1. Log in to LinkedIn and select view profile
  2. In the license & certification section of your profile click the + button to add a new certification
    1. Name= “Chartered Financial Analyst® (CFA) Charterholder”
    2. Issuing organization= “CFA Institute”
    3. Select “This credential does not expire” if your membership is active
    4. Enter the month and year you received your charter into the Issue date field
    5. If you have claimed your digital badge, you may enter your digital badge URL into the Credential URL field
    6. Press save

How to share on LinkedIn for CFA Program Candidates

If you are a candidate in the CFA Program, you may advertise your candidate status on LinkedIn if you have passed an exam. 

To add your CFA Program Candidacy on LinkedIn follow these steps:

  1. Using a desktop, log in to LinkedIn and select view profile
  2. In the accomplishments section of your profile click the + button to add a new test score
    1. Test Name=Enter Level I, II, or III CFA exam
    2. Score=Enter “passed”
    3. Test Date=Enter the month and year you passed the exam
    4. Description=Enter the level you have completed.  For example “Passed Level II of the CFA Program.”
    5. Press save

To reference your CFA Program Candidacy for an upcoming exam on LinkedIn follow these steps:

  1. Using a desktop, log in to LinkedIn and select view profile
  2. In the accomplishments section of your profile click the + button to add a course
    1. Course Name=Enter Level I, II, or III CFA exam candidate
    2. Leave all other fields blank
    3. Press save

How to share CFA designation on Twitter

You can only include “CFA” after your name if your membership with the CFA Institute is active and in good standing.  

  • CFA should not be included in your Twitter handle.  For example, @JohnSmithCFA is not allowed.
  • CFA or Chartered Financial Analyst should only appear in your name field. 
  • If you are going to put CFA next to your name on Twitter, your name should be your legal name.
  • No aliases are allowed to be used as a name if planning to use the CFA designation.

How to share CFA designation on Facebook

You can only include “CFA” after your last name if your membership with the CFA Institute is active and in good standing.

  • CFA or Chartered Financial Analyst should only appear in your last name field.  For example, John Smith, CFA 
  • If you are going to put CFA next to your name on Facebook, your name should be your legal name.
  • No aliases are allowed to be used as a name if planning to use the CFA designation.

Why do CFA charterholders pay to remain a CFA member?

CFA charterholders pay to remain a CFA member with the CFA Institute to keep their CFA status active.  CFA charterholders must maintain ethical and professional standards set by the CFA Institute as well as participate in annual professional development requirements.  Failure to do so could result in disciplinary action or removal from CFA membership.

Can you get a job after passing CFA Level I?

Yes, it is possible that you could get a job after passing the Level I CFA exam. However, there is no publicly available information that shows whether passing the Level 1 CFA exam made any impact during the hiring.  What is clear is that passing all three CFA exams and becoming a CFA charterholder is likely to have a significant, positive impact on your career path.

Is taking the CFA worth it?

There are a lot of personal and industry factors to consider when deciding if taking the CFA is worth it for you.  Most financial analysts ask themselves this question at some point in their careers, which is why we have developed an entire article to help you decide if the CFA is really worth it for you.

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Posted by Kaplan Schweser - December 1, 2021
How to show CFA designation on resume and social media

Is Being an Investment Manager a Good Career Option?

If you would like to help others discover the best ways to get substantial returns on their investments, are intrigued by analyzing risk, or are interested in helping businesses buy other businesses, consider a career in investment management. Contrary to popular film and fiction, this career does not limit you to pin-striped suits and high-pressure deals on the floor of a noisy, crammed trading room. You have plenty of opportunities to avoid stock exchanges (unless that’s where you want to be). 

How to Become an Investment Manager

Investment managers provide advice and direction to their clients so they meet their goals and get returns on their financial assets. If you want to become an investment manager, you’ll most likely need a fair amount of education, experience, and dedication.

What Education Do You Need to Become an Investment Manager?

You will need a bachelor’s degree in a field such as financial management or economics to start off.  To help get you closer to obtaining the Investment Manager job title, popular options include:

What Skills Do You Need to Become an Investment Manager?

You will need to be able to cope with stress and thrive in a competitive work environment to become an investment manager.  It is expected that you are passionate about the field and the needs of your clients.  You will succeed if you are goal-oriented, enjoy mathematics, are proficient in data analysis, and love to solve problems.

Should You Become an Investment Manager?

Here are 7 reasons why being an investment manager is a good career option to pursue:

Investment Managers Have Lots of  Career Options

There are many jobs available to investment managers. The U.S Bureau of Labor Statistics (BLS) estimates there are over 650,00 financial manager jobs in the US in 2020.  jobs in banks, brokerage firms, credit unions, and insurance companies. You can be a financial analyst, fund manager, portfolio manager, risk manager, hedge fund manager, alternative investment analyst, stockbroker, risk analyst, ratings analyst, private equity associate, and more. You can choose to manage the investments of individuals or businesses. With the right education and knowledge, there is also the opportunity to join well-known financial institutions like Vanguard, JP Morgan Chase, Goldman Sachs, Citigroup, HSBC, and Merrill Lynch, just to name a few. There are also ways you can work for yourself if you’re dedicated, realistic, and have enough experience with a finance employer first.

Investment Management Is Fascinating

Investment managers give people and companies advice on what to do with their money. This involves a kind of detective work that will be different each time you do it as you match investments with your clients. One day you might be helping a fashion designer, and the next day, it’s a company that built an app to help disaster victims find relief and shelter. Every day is different. And, since investments can be affected by global events, extreme weather, and unpredictable things like human emotions, there is no time to be bored. You have to keep coming up with new and different investment strategies and ways to direct funds on behalf of clients.

Investment Management Can Be a Lucrative Career

The investment management profession offers some of the highest starting salaries in finance. For those who are talented and ambitious, there’s also a great deal of room for that salary to grow quickly. In the United States, Glassdoor reports that the annual salaries for investment managers range from $51,000 to just under $172,000. The U.S. Bureau of Labor Statistics (BLS) puts investment managers in both the financial analyst and financial manager categories and reports that the median annual salary was between $83,664 and $134,180 for both positions in 2020.

The Investment Manager Job Outlook Is Bright

With so many different financial products and a growing need for people with in-depth knowledge of geographic regions, it’s no surprise that most industry analysts expect strong employment growth in the investment management field midway into the next decade. According to the BLS, employment in investment management is expected to grow 17 percent from 2020 to 2030. This job's outlook is much brighter than the average for all occupations, especially if you happen to be tech-savvy. The competition will be fierce, but with the right education, you should be able to land a good entry-level investment position.

Investment Managers  Don’t Have to Spend Years in Additional Schooling

Are you in the process of earning, or do you already have, a bachelor of science (BS) in business administration, a BS in finance, or a related degree? If so, we have good news. Any of these degrees are all you need to get started in an investment management career. Also, earning a voluntary certification or charter such as the Chartered Financial Analyst® (CFA) charter, the Chartered Alternative Investment AnalystSM (CAIA) charter, or the Financial Risk Manager (FRM) designation is a great way to augment your degree without going to graduate school.

If you’re curious about the differences between these designations, you can learn more in these articles about the CFA charter vs. the CAIA charter, the CAIA charter vs. FRM certification, and the FRM certification vs. the CFA charter.

Considering the CFA® charter? Download this free Before You Decide to Sit for the CFA Exam eBook.

Investment Managers Can Be Creative and Innovative 

There’s a tendency to think that anyone who chooses to invest for individuals or businesses as a living is a numbers-cruncher. Numbers are involved, but your main focus is investment portfolios, not equations and calculations. These portfolios should be as diverse as possible—comprising lots of different businesses, projects, and sectors. Moreover, as we mentioned in reason #2, you have to tailor these portfolios to the needs, passions, and beliefs of your clients. In other words, investment management offers you remarkably rewarding opportunities to develop and innovate, delivering solutions that make a true difference in individuals’ lives or in the way business and capital move forward.

Investment Management Is Satisfying

A great deal of what investment managers do involves solving problems. With each resolution and discovery, there’s satisfaction. Think of how it would feel to know that you recommended something that made money for one of your clients. Not only is there the knowledge that they benefited from your decision, but there’s the joy of knowing that after a lot of research and detective work, you picked a winner. Now imagine how it would feel to do that consistently over time. Of course, you won’t get it right every time. But even then, being wrong in investment management brings experience and expertise. If you think about it, that’s another type of satisfaction—having learned a lesson well.

Are you ready to learn more about this fascinating and satisfying career? If you think that a career in investment management is right for you, check out these resources that can help you get started.

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Posted by Kaplan Schweser - October 7, 2021
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CPA vs. CFA® Designation

Becoming either a CFA (Chartered Financial Analyst) charterholder or a CPA (Certified Public Accountant) is a big step in your career. Both designations are impressive additions to your resume and great career boosters. If you’re considering acquiring one of these certifications, it’s important to understand the differences between the two. Although they’re both related to finance, they can take your career in very different directions. Read on to learn more about the differences between the CFA charter and CPA, how to prepare for the respective exams, and how acquiring either can affect your career. 

CFA® Charterholder vs. CPA: What Is the Difference?

CFA charterholders and CPAs both work with financial records, consult with clients, and assess the viability of different businesses and organizations; however, the outcome of these tasks is different depending on which credential you hold. CFA charterholders focus on understanding market conditions, assessing businesses, and determining the best way for businesses or individual clients to invest their money. They use investments to produce revenue for their clients, and some charterholders buy or sell securities, funds, and more on behalf of their clients. CFA charterholders are likely to be investment analysts, financial advisors, and portfolio managers, Some even go on to become chief financial officers (CFOs).

By contrast, CPAs produce financial records. They may calculate taxes owed or assess business practices to identify ways to save money. They must also ensure that applicable financial regulations are followed. Some CPAs use their accounting skills to identify evidence of fraud or other crimes. 

Is Becoming a CPA Worth It?

If becoming a CPA appeals to you, you’ll need to weigh the pros and cons of preparing for and taking the CPA exam.

Pros of becoming a CPA:

  • Potential salary increases will make up for the cost of preparing for and taking the exam itself. 
  • Preparing for the exam will teach you skills and knowledge that will help you become a better accountant.
  • Becoming a CPA signals that you’re dedicated to your profession, which can give you more opportunities and flexibility in your career.

Cons of becoming a CPA:

  • It’s expensive. The cost of the CPA exam itself varies by state, but expect to spend around $1,000 for registration and testing fees, plus several thousand dollars for a review course (which we highly recommend). Some firms reimburse their employees for CPA exam-related costs, so check with your employer to see if you qualify. 
  • It takes lots of time. It’s recommended that you spend 300–400 hours preparing for the CPA exam, in addition to the time it takes to actually take the test (~16 hours total). 
Keep in mind that while the monetary and time expenses you’ll inevitably need to invest in order to become a CPA may seem daunting, becoming a CPA will allow you more job opportunities and financial stability. 

CPA Exam Topics

Unlike the CFA exam, which focuses on investment tools, valuing assets, and portfolio management and wealth planning, the CPA exam is designed to test your knowledge of auditing procedures and standards, taxation, and accounting and reporting standards for a variety of organizations. 

The CPA exam is divided into four testlets, each approximately 4 hours long. You must pass all four testlets within an 18-month period in order to become a CPA. The four testlets are as follows:

  • Auditing and Attestation (AUD)
  • Business Environment and Concepts (BEC)
  • Financial Accounting and Reporting (FAR)
  • Regulation (REG)

You’ll be tested on the following topics on the CPA exam:

  • Auditing procedures and professional auditing standards
  • Standards related to attest, assurance, accounting, and review engagements
  • Corporate governance
  • Economics
  • Information technology
  • Financial management, strategic planning, and operations management
  • Accounting and reporting standards applicable to not-for-profit organizations and government entities
  • Federal taxation, ethics, professional and legal responsibilities, and business law

CPA Career Paths

There are many directions you can take in your career after becoming a CPA. Deciding the industry in which you’d like to work is the first decision you’ll need to make. Your options include: 

  • Public accounting: Public accounting firms provide a variety of clients with accounting services, such as financial planning, bookkeeping, and audit preparation. It’s common to work in public accounting for a few years before transitioning to private accounting or another more specialized type of accounting.
  • Government accounting: Government accountants perform audits, assess the efficiency and effectiveness of various government units, oversee public funds, and investigate white-collar crime for the FBI.
  • Private accounting: Private accountants work for a single company’s internal accounting department. They manage the company’s financial records, prepare financial reports, and assess the company’s fiscal performance.
  • Nonprofit accounting: Nonprofit organizations require accountants who can complete specialized tasks. These include evaluating donor-restricted assets, which can only be used for specific purposes, accounting for different types of services and programs, and fundraising.
  • Academia: Accounting professors not only teach students about accounting and research accounting theory, but they often also serve as accounting consultants to companies, firms, and in legal proceedings.

CFA Charterholder vs. CPA Salary

Salaries can vary widely for both CFAs and CPAs based on location, experience level, and company size. That being said, the average salary for both CFAs and CPAs is significantly higher than that of financial professionals and accountants without these certifications.

CFA Charterholder Salary

According to Payscale, CFA charterholders in the United States can earn anywhere from $60,000 to well over $200,000 annually. Payscale also estimates the average CFA charterholder salary to be $92,947 a year. The broad range is a reflection of all you can do with the charter. Bonuses and years of experience make a difference, too.

Here are the average salaries of some of the most common positions for CFA charterholders:

  • Research analyst: CFA charterholders who are research analysts earn, on average, $77,000 a year, according to Payscale.
  • Financial advisor: Financial advisors with the CFA charter earn an average salary of $83,000 annually.
  • Investment analyst: Investment analysts with the CFA charter earn an average salary of $78,000 annually.
  • Portfolio manager: The average salary for a portfolio manager with the CFA charter is $102,000.
  • C-level executive: Payscale says that chief financial officers with CFA charters have a median annual base salary of $173,000.

Considering the CFA charter? Before you choose your CFA exam date, download this free, Before You Decide to Sit for the CFA Exam, eBook.

CPA Salary

Payscale says the average salary for CPAs is $86,979. At a minimum, CPAs have completed certification requirements after earning a bachelor’s degree in accounting and are qualified for better positions than regular accountants. If a CPA has a master’s degree, the median annual income increases to $91,000, according to accounting.com.

Here are the average salaries for some of the most common positions for CPAs:

  • Accountant and auditor: Accountants and auditors who are CPAs earn a median annual salary of $69,000.
  • Financial controller: Financial controllers oversee and direct a company’s accounting functions. The average annual salary for CPAs in this position is $98,000.
  • Corporate controller: CPAs in the executive role of the corporate controller can expect an average salary of $114,000 a year.
  • Chief Financial Officer: The average annual salary for CPAs who are CFOs is $151,000.

CFA vs. CPA Difficulty

Acquiring either the CFA charter or CPA certification is a long process that requires a degree, several years of experience (in most states), and a passing score on a long, difficult exam. This table breaks down the requirements to become a CFA and CPA: 

 

 CFACPA
EducationBachelor’s degreeBachelor’s degree; 150 hours of pre-licensure education (inclusive of Bachelor’s degree)
Experience4 years of professional experience2 years professional experience (in most states)
ExamPass Levels I, II, and III of CFA ExamPass all four CPA exam portions: AUD, BEC, FAR, and REG within 18 months

 

Pass rates for both the CFA and CPA exams are updated with each testing administration. Learn more about CFA exam pass rates and CPA exam pass rates.  

Which credential is more difficult to acquire depends on your individual circumstances and strengths. Make your decision based on which will help your career progress the most, not on which you believe will be easier to obtain. In the long run, the hard work will pay off no matter which certification you choose. 

 

CFA vs. CPA Infographic

CFA vs CPA Designation Infographic

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Posted by Kaplan Schweser - December 22, 2020
CFA vs CPA salaries being compared on paper

Become a Hedge Fund Manager

Hedge funds are low-risk, high-return funds characterized by a high level of investment diversity. They are managed by hedge managers, whose job is to develop investment and risk management strategies for their portfolios in order to gain the highest possible return on investments while maintaining a low level of risk.

Hedge fund management careers can be highly rewarding and lucrative, but they are also extremely demanding and competitive. Read on to learn more about hedge funds, what it’s like to be a hedge fund manager, and how to become a hedge fund manager.

What Is a Hedge Fund?

Hedging means reducing risk. A hedge fund is an investment vehicle that utilizes a variety of investment and asset management techniques to maximize potential return while maintaining a comfortable level of risk for the client. Hedge funds are pooled funds, meaning that they consist of investments from many different individual investors for the purpose of a larger investment portfolio with more diversifying potential. 

Hedge funds require a large initial investment, limiting investors to high-net-worth individuals and institutions. To ensure that investors can handle the potential risks that accompany any kind of large investment, the Securities and Exchange Commission requires investors to be accredited before investing. Some general basic requirements are that investors have a net worth of over $1 million (excluding primary residence) and an annual income of $200,000.  


What Is a Hedge Fund Manager?

A hedge fund manager is essentially a consultant for hedge funds. Hedge fund managers work closely with clients to develop investment strategies and manage portfolio trading activities based on the client’s goals and desired risk-reward ratio. Fund managers ensure that assets are managed as cost-efficiently and profitably as possible, which includes making decisions to buy, sell, or hold assets. A fund manager pays close attention to cost and risk associated with capitalizing on cash flow opportunities to ensure proper liquidity of funds.

Fund management is a marriage between hard financial and accounting skills and consulting and research skills. Fund managers regularly research companies, read financial briefings, and stay up-to-date on current events and global economies. They meet with investment analysts and company managers to better understand pertinent financial information. They also likely have a team of financial analysts who use the latest software to do more in-depth analyses on firms, markets, and economic variables. This helps them make recommendations and predictions about future prices and trends.


How to Become a Hedge Fund Manager

Hedge fund manager is rarely an entry-level position. You should expect to devote several years to secure a fund manager job. These are the steps that can get you there.

Complete your education.

First, earn a bachelor’s degree. Majors such as finance, accounting, economics, or business administration provide a solid background for a career as a fund manager. However, majoring in something unrelated to finance (such as a foreign language, hard science, or humanities major) will set you apart, as long as you’re able to defend your reasons for choosing such a major and explain how the skills you learned will translate to a job in finance.

Second, consider getting an MBA or a master’s in finance. You won’t need a graduate degree for an entry-level position in finance, but it may be required as you get closer to becoming a fund manager. Make a plan to get your master’s early in your career. Although graduate schools often like to see that you’ve had several years of work experience before you apply, creating a timeline for yourself early will help you take the required admissions tests and gather your application materials on time.

Complete a financial internship. 

An internship is a critical step in the process of starting a career in finance and eventually becoming a hedge fund manager. Having at least one internship on your resume can help you find employment after you leave school, potentially at the firm where you interned. Research the firms in your area that are offering finance internships, and keep applying until you get an offer.

Internships teach you about the investment industry and introduce you to the day-to-day tasks associated with being a fund manager. You will be able to learn about potential future roles, including hedge manager, ask questions, and gain real-world experience in finance while honing your decision-making and communication skills. Internships are also invaluable networking opportunities. You can develop relationships with employees and other interns who can act as references when you begin looking for jobs.
 

Get an entry-level position in finance.

Start by identifying a company or firm you want to work for and look for entry-level financial analyst positions. These positions are popular and competitive, so you need to set yourself apart. Be sure your resume reflects the qualities you’ll bring to the table and demonstrates some of the skills that make you an exceptional potential employee. Emphasize what you learned as an intern, and keep in mind that most people applying for the position will have an academic background similar to yours, so make sure your resume includes many other experiences, too.

If you’re invited to interview, prepare in advance. Determine the three or four things that differentiate you from other candidates and what you want the interviewer to know about you by the time the interview is over. In the interview, keep these things top of mind, and you’ll be prepared to frame your answers in a way that reflects them.

Presenting yourself as the ideal employee doesn’t end when you get hired. To move into a fund manager position, you need to consider each day a part of your next interview. Simply put, companies promote successful, exceptional employees. The quickest way to move up the ranks is to stay on top of the industry and your firm, making the most of every opportunity to demonstrate your value.

Choose a niche.

By learning and observing the work in your firm, you will soon see that each fund manager handles a different kind of fund (from a long list) and has a different investment philosophy and style. A few examples are small-cap, midcap, large-cap funds, funds for emerging markets, balanced funds, sectoral funds, and pure equity funds. Choose one or two that appeal to you (or that you feel are most likely to enable you to move up), and learn all you can about them.
Having fund management knowledge that is specialized adds to your confidence. More importantly, it can give you an edge over others as you start vying for a more senior role on your way to becoming a fund manager. 

Earn your CFA charter. 

An effective way to accelerate your learning and demonstrate your commitment to your employer (or other potential employers) is to earn your CFA® charter.

The CFA exam is a three-level examination offered by CFA Institute. Charterholders estimate they spent an average of 300 hours of study per level. It’s a challenging exam, but passing it can make you one of just 150,000 CFA charterholders worldwide.

Considering the CFA charter? Download this free Before You Decide to Sit for the CFA Exam eBook.

What Is It like to Work at a Hedge Fund?

The hours you work depend on where your hedge fund is located. If you’re on the east coast of the U.S., the hours will typically be from 7:00 am to 7:00 pm. If you are on the west coast of the U.S., the typical hours are from 5:30 am to 5:00 pm. Because your attention will be riveted on the markets when they’re open, the majority of your research needs to be done before and after market hours.


On Quora, an anonymous hedge fund investment professional wrote that, although there is no typical day in a hedge fund, there was a certain rhythm. “I review my to-do list for the day and make adjustments if necessary. If a stock I’ve been following moves materially, I’ll make it a priority to look at what’s going on. I’ll also check in with the portfolio manager to see if there’s anything he’d like me to work on or to get feedback on an analysis I’m working on. Beyond that, it’s a lot of reading and analysis. Public filings, transcripts, company presentations, data analysis, forecasts, etc.”

Other descriptions of working at a hedge fund are similar. One hedge fund manager at a small firm that manages assets valued at $1 billion likened the work environment to a “pressure cooker,” but she still enjoys it. Another hedge fund manager says that “it is never boring” because you have a chance to innovate every day. Overall, most professionals emphasize that if you’re willing to put in the work and the hours and are a creative go-getter, you will enjoy the work and the rewards.


Hedge Fund Manager Salary

Hedge fund manager jobs can be extremely lucrative, and the best fund managers can make over $1 billion a year. That being said, your salary is dependent on the size of your fund and the success of your investments, so most fund managers, while still earning a large salary, make considerably less than this.

Hedge fund manager salaries are based on the Two and Twenty model. “Two” means 2% of the total market value of investments managed by the hedge fund manager, and “twenty” means 20% of the profits made by the fund above a set threshold (or minimum rate of return).
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Posted by Kaplan Schweser - December 22, 2020
Fund managers checking financials on a tablet

Become an Investment Banking Analyst

Investment banking careers, although demanding, are some of the most rewarding financial career opportunities available. For one, you have a hand in real-time financial markets and help companies, government organizations, and other clients succeed financially. You also have great opportunities for future career growth and satisfaction; investment banking is an incredible stepping stone to more prominent careers in finance. Read on to learn more about investment banking, investment banking careers, and how to become an investment banking analyst. 

What Is Investment Banking?

Investment banks serve as intermediaries between companies and the financial markets. Investment banks help their clients become publicly traded, facilitate mergers and acquisitions, provide financial advice, trade stocks, and research market trends to help clients make lucrative financial decisions. 

About Investment Banking Analyst Jobs

An investment banking analyst evaluates and researches investment opportunities with the aim of finding the investment that best meets the goals of their corporate clients. Investment banking analysts assess opportunities and recommend investments based on client needs and goals. They are usually part of an investment team and are likely to report to an investment banker who will ultimately guide clients to their final decision.

The corporate clients can be new investors, existing investors, or even the analyst’s own company. If the clients are new, the analyst gathers and processes data, investigates opportunities, and presents the findings to the team and sometimes the client. For existing clients, the analyst evaluates their investments based on performance and makes recommendations for keeping or replacing them. If the client is their company, analysts assess business assets, earnings reports, industry trends, and more to make investment recommendations for their institution.

Other investment banking analyst responsibilities include the following:

  • Reviewing and analyzing data for investment portfolios, including the performance of stocks and bonds, credit trends, and other transactions
  • Presenting the results of their research and investigation to the investment banking team, an investment banker, or even clients
  • Handling administrative tasks such as arranging meetings, generating reports and other materials, and making sure the team operates smoothly

What’s the Difference Between an Investment Banker and an Investment Banking Analyst? 

Most investment bankers start out as investment banking analysts and hold that position for 2–3 years before moving on to an associate position. If you have just graduated with a degree in finance and want to work in an investment bank, your most likely entry point will be as a financial banking analyst.

Investment bankers are critical to corporations and communities who want to raise money to fund their activities. Investment bankers underwrite securities and help corporations navigate through some of the most difficult business processes, such as mergers and acquisitions and initial public offerings. They act as intermediaries between their banks and their corporate clients, assisting in complex financial transactions and issuing securities as a way of raising money. They also use sophisticated financial modeling to determine cost estimates of financial instruments and identify potential risks, project possible earnings and prepare documentation on behalf of their clients.

How to Get Investment Banking Analyst Jobs

Investment banking analyst jobs are highly competitive, but if you get an offer and do well, you’ll have a highly rewarding job with upward mobility. Follow these steps to increase your chances of landing an investment banking analyst job. 

Earn Your Bachelor’s Degree

The first step toward becoming an analyst in investment banking is completing your undergraduate degree. Common majors for future analysts include accounting, finance, and math. That being said, some successful investment banking analysts majored in something totally unrelated, such as a foreign language or science. No matter what you major in, make sure you can market the skills you developed in your undergrad in your interviews for investment banking analyst jobs.

Complete an Investment Banking Internship

Internships have several advantages. First, internships provide you with real-world practical experience. Immersion is truly the best way to learn and become acclimated to the life of an investment banking analyst. Secondly, the experience and skills you gain in an internship will make you more attractive to potential future employers. Think of your internship like a long-form job interview; investment banking interns often earn the opportunity to be considered for a position as an analyst after graduation, based on the great work they did during their internship. Finally, internships provide a valuable environment to make connections and build your network. It may lead to future opportunities in the firm where you’re interning, or it could lead elsewhere, as the people you work within your internship move on to other banks.

Register With FINRA and Pass Applicable Securities Exams

In order to operate as an investment banking analyst, you are required to register as a representative of your bank with the Financial Industry Regulatory Authority (commonly called FINRA). In addition, depending on the type of work you will be doing, you need to prepare for and pass any applicable securities (series) licensing exams to qualify for registration.

Stand out With the CFA® Charter

While not required, prospective investment banking analysts often start their CFA exam prep while they are still in their undergrad or soon after they graduate. The CFA charter is globally recognized as the most respected investment management designation you can earn. The program focuses heavily on investment valuation, company analysis, and portfolio management. 

Earning the CFA charter requires you to pass three levels of exams. This process typically takes several years. Candidates study an average of 300 hours per level. In order to earn the charter, you must also demonstrate that you’ve logged 4,000 hours of applicable investment work experience. But you don’t need any experience to start, so it’s common for individuals to complete the examinations while earning their required experience.

A major benefit of earning the CFA charter is that it can help you build your network through CFA Institute and local CFA Societies.

Considering the CFA Charter? Download this free Before You Decide to Sit for the CFA Exam eBook.

Investment Banking Analyst Salary

What could you make as an investment banking analyst? How much you earn as an investment banking analyst depends on where you live, how long you’ve been working, and what company you work for. As of 2020, the average investment banking analyst salary in the United States is $86,643, but that can vary widely. 

In addition to an annual salary, investment banking analysts receive an annual bonus based on their personal performance and the performance of their employer. You can expect this bonus to exceed $50,000, and it can even exceed your annual salary in some cases. Keep in mind, though, that although investment banking analysts can earn a huge amount of money right out of college, they are also working incredibly long hours. It’s not uncommon to work 90–100 hour work weeks

Why Investment Banking?

People often go into investment banking for the wrong reasons. If you’re drawn primarily by the prestige and earning potential, you won’t find satisfaction in your work and might even burn out quickly. Below are some reasons why investment banking might be a good fit for you:

  • You’re interested in the skills you’ll gain as an investment banking analyst, such as Excel, and financial modeling. 
  • You want to learn more about high-profile transactions, financial markets, and how a company makes financial decisions.
  • You thrive in a fast-paced environment with long hours.
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Posted by Kaplan Schweser - December 22, 2020
Investment banking analyst addressing the team in a meeting.

Is the CFA® Charter Useful for Corporate Finance?

The CFA® charter can be useful in a corporate finance career. Corporate finance includes implementing various strategies for corporate investment and increasing shareholder value. The CFA exam covers some corporate finance topics, such as portfolio management, working capital management, and more. This article explores the corporate finance roles for which earning the CFA charter is a good idea.

Research Analyst

Research analysts play an important and specific role in corporate finance, using a combination of mathematical processes and qualitative data to look for trends and patterns that can inform corporate investment and financial planning. They are able to process data and provide recommendations. The intelligence they gather is incredibly valuable to corporations, and 15 percent of CFA charterholders are research analysts. Many of them are in a corporate finance role.

Considering the CFA® charter? Download this free Before You Decide to Sit for the CFA Exam eBook for invaluable advice.

Corporate Financial Analyst

Corporate financial analysts use historic and qualitative data, microeconomics, and macroeconomics to uncover trends and patterns that enable them to make predictions and forecasts. In corporate finance, these analysts conduct research, provide advice, and are relied on as critical advisors in the process of making investment decisions. According to CFA Institute, 5 percent of those who hold the CFA charter have a corporate financial analysis role.

Equity Analyst

Equity analysts research and report how strong companies are in the securities market. Their focus is on stocks. The equity analysts who work in corporate finance research companies in their employers’ portfolios. Some equity analysts prepare reports that offer buy and sell recommendations to management. We were not able to find statistics for what percentage of CFA charterholders are equity analysts, but it is a valuable designation in this field.

Portfolio Manager

Portfolio managers in corporate finance are in charge of their company’s fund or group of funds. They spend their days working with analysts and researchers to stay current on the markets and business news that might affect their funds. They make decisions to buy and sell assets as the markets fluctuate. They look beyond surface information and make decisions for their companies based on expert insight and experience. CFA Institute reports that 22 percent of CFA charterholders are employed as portfolio managers. It is likely that part of that percentage of charterholders is in corporate finance.

Chief Financial Officer

CFOs are the head of corporate finance. Holding the CFA charter does not guarantee you’ll make it to the C-suite in corporate finance. CFA Institute says that approximately 7 percent of all the CFA charterholders are chief-level executives, but they do not specifically state whether they are CFOs, CEOs, CIOs, and so on. However, CFO positions are considered the pinnacle of finance achievement, so CFOs probably make up a great deal of that percentage.

In addition, if the CFO or someone in a senior corporate finance role is a CFA charterholder, holding the charter can be a big plus for you. If those with the responsibility of hiring or choosing analysts and managers in corporate finance hold the charter, they tend to look favorably on candidates or entry-level roles who have also earned it.

Ready to Learn How to Become a CFA® Charterholder?

We have five good reasons why you should. If you’re planning to sit for the CFA exam, explore our CFA study materials.

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Posted by Kaplan Schweser - December 17, 2020
Conceptual Graphic showing the CFA charter value in a Corporate Finance

CFA® Charter vs. FINRA Series 7: Everything You Need to Decide

If you are exploring a career in finance related to advising clients on investment strategy, you’ve probably heard about the CFA® charter and the FINRA Series 7 license. So, how do you know which one to earn? In this article comparing the CFA charter to the FINRA Series 7 license, we give you everything you need to decide.

What do CFA® Charter and FINRA Series 7 Mean?

The Chartered Financial Analyst® (CFA) charter is the professional credential offered internationally by CFA Institute to investment and financial professionals. The program covers a broad range of topics relating to investment and portfolio management, financial analysis, stocks, bonds, and derivatives, and provides a generalist knowledge of other areas of finance. Industry professionals worldwide recognize the CFA charter as the “gold standard” of all financial analyst designations.

Also known as the General Securities Registered Representative license, the Series 7 license is administered by the Financial Industry Regulatory Authority (FINRA), a regulatory body that regulates member brokerage firms and exchange markets. If you hold this license, you can sell corporate stocks and bonds, municipal bonds, mutual funds, variable annuities, options, direct participation program partnerships, collateralized mortgage obligations, and more.

It is possible to hold both credentials. Many CFA charterholders who take staff positions in the research departments of brokerages will go on to earn their Series 7 licenses. For Series 7 license holders who become investment advisor representatives or set up registered investment advisor firms, holding the CFA charter is beneficial to their business and clients.

CFA Charter vs. Series 7: Similarities

Both are finance industry credentials, and both are earned by passing a set of exams. The CFA exam has three levels. The Series 7 exam is a corequisite of another exam called the Securities Industry Essentials (SIE), and you must pass both exams to earn your license. The Series 7 exam is sometimes referred to as a “top off” exam because the SIE is a corequisite of several FINRA exams, and earning the Series 7 license requires specific knowledge on top of security industry basics.

CFA Charter vs. Series 7: Differences

Earning the CFA charter requires knowledge and expertise in a broad range of financial analysis topics, such as portfolio management, economics, reporting, quantitative analysis, and more. Its three levels of exams are intense, and each requires an average of at least 300 hours of study to pass. However, because it is a charter, it is not a requirement. You can be employed as a financial analyst, for example, without a CFA charter.

The Series 7 is a license, comparable to those you have to earn to sell real estate or insurance. Anyone who is a stockbroker must hold the Series 7 license. While also intense, this exam is generally believed to be significantly less difficult than the CFA. Its focus is also much narrower; it tests you on your knowledge of the concepts and functions of a registered representative.

CFA Charter vs. Series 7: Requirements

To become a CFA charterholder, you need to do the following:

  • Have a bachelor’s degree (or equivalent) or be in the final year of your bachelor’s degree program. If you have 4,000 hours of relevant work experience or a combination of professional work and university experience that totals 4,000 hours, you are also eligible for the CFA Program.
  • Take and pass Level I, Level II, and Level III of the CFA exam.
  • Become a member of CFA Institute (which costs $275 and includes agreeing to abide by its code of ethics).
  • Provide CFA Institute with proof that you’ve been working full-time for 4,000 hours in a role that either involves investment decision-making or with a product that contributes to that process. This can include any work experience you had before passing the exam, as well as after.

To earn the Series 7 license, you need to do the following:

  • Take and pass the SIE exam. There are no degree or work requirements for taking this exam, although most candidates are either earning a college degree in a finance-related field or already have one.
  • Secure a sponsorship with a FINRA-member firm. You need to work for them for 4 months; after that, they can file a special application called a Form U4 that registers you for the exam.
  • Take and pass the FINRA Series 7 license exam. Like the SIE, there are no degree or work requirements, but most candidates have a college degree in a finance-related field.

Considering the CFA charter? Download this free Before You Decide to Sit for the CFA Exam eBook.

CFA Charter vs. FINRA Series 7: Exam Topics, Formats, Fees, and Pass Rates

In a discussion about CFA versus Series 7, people are most likely to be concerned about the exams. Here’s what you need to know.

The topics of the CFA exam are as follows:

  • Ethics
  • Quantitative Methods
  • Economics
  • Financial Reporting and Analysis
  • Corporate Issuers
  • Equity Valuation
  • Alternative Investments
  • Fixed Income
  • Derivatives
  • Portfolio Management

    In 2022, the CFA Level I exam will be offered four times a year. Level II will be offered three times a year and Level III will be offered twice.

    Latest CFA Exam Dates »

    All levels are computer-based and the format of the first two levels is multiple-choice. Level III has a written portion called constructed response and a multiple-choice portion. When you register for the Level I CFA® exam, you will pay a one-time enrollment fee of $450.

    Because the CFA® exam has three levels, you will pay separate registration fees for each level. Most recently, the fees for each level are $700 for early registration and $1,000 for standard registration.

    Recent CFA Exam Pass Rates »

      One thing that the CFA exam has in common with the Series 7 exam is that beginning all levels will all be administered by computer at a Prometric testing center. Prometric also administers the Series 7 exam.

      The topics of the Series 7 exam are as follows:

      • Investment Risk
      • Taxation
      • Equity and Debt Instruments
      • Packaged Securities
      • Options
      • Retirement Plans
      • Interactions With Clients

      Series 7 exams are administered throughout the year. After your sponsor submits the Form U4 application, FINRA opens up a 120-day window, and you can take the exam on the days it is offered within that window. The pass rate for the exam as of March 31, 2019, was 71%.

      CFA Exam vs. FINRA Series 7 Exam: Preparation

      Another similarity between the two credentials is that the exams are nearly impossible to pass if all the candidate does is last-minute cramming. So, whether it’s the CFA exam or the FINRA Series 7 exam, you should start studying early.

      To prepare for the CFA exam, CFA Institute advises a minimum of 300 hours of study for each level. You should focus on the Learning Outcome Statements (LOS) from CFA Institute because they detail exactly what you are expected to do on exam day.  CFA exam preparation classes can really help, as will immersing yourself in practice questions. In addition, you should plan to take as many mock exams as you can to get used to the whole exam process.

      To prepare for the FINRA Series 7 exam, plan to spend 80–100 hours studying if you have a finance background and about 150 if you don’t. The questions are detailed and related to the day-to-day activities, responsibilities, and job functions of representatives. Therefore, you should expect it to be challenging. Series 7 exam preparation classes are recommended as part of the preparation process, along with making a study plan, focusing on learning concepts, using practice questions, and taking practice exams.

      CFA Charter vs. FINRA Series 7: How to Choose

      Deciding which designation to pursue really depends on what you want to do in your career. With a CFA charter, you have a  number of career opportunities, such as portfolio manager, research analyst, consultant, risk manager, corporate financial analyst, financial adviser, and the C-suite. If you want a career selling stocks in a brokerage, investment firm, or bank, then not only is the FINRA Series 7 right for you, but it is required.

      Of course, you don’t have to choose at all. Having both designations opens more doors in your career, especially if stocks and other securities investment products are your passion. No matter which path you choose, there is a wealth of information out there that can help you earn the credential or credentials you need. You can get started here and here.

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      Posted by Kaplan Schweser - December 17, 2020
      Compass on financial papers indicating a decision - CFA Charter versus FINRA Series 7

      Chartered Financial Analyst® Salary: What Do CFA® Charterholders Make?

      Earning your CFA® charter sets you up well for growth in your career as a finance professional. But what kind of salary can you earn? According to Payscale, in the United States, the CFA charterholder salary is anywhere from $64,234 to $255,000 a year. Why is there such a big range? Because there is a lot you can do with the charter in jobs with varying degrees of responsibility. Bonuses and years of experience make a difference, too. So let’s look at what the average salary is for some of the most common jobs for CFA charterholders.

      Portfolio Manager Salary—With the CFA® Charter

      According to CFA Institute, 22% of CFA charterholders are employed as portfolio managers. CFA Society Chicago’s annual financial compensation survey reports that the median base annual salary for a fixed income portfolio manager is $132,500; and for an equities portfolio manager, it is $136,000.

      Research Analyst Salary—With the CFA® Charter

      In a survey compiled by CFA Institute,15% of global CFA charterholders said they were research analysts, responsible for analyzing mathematical processes and qualitative data to make future predictions. Payscale reports that CFA charterholders who are research analysts earn, on average, $73,954 a year.

      Chief-Level Executive Salary—With the CFA® Charter

      CFA Institute says that approximately 7% of all CFA charterholders in the world have made it to the C-suite. The most common titles for executives with the CFA charter are chief investment officer or chief financial officer. CFA Society Chicago says that chief investment officers with CFA charters have a median annual base salary of $227,500; for CFOs, Payscale says it’s $170,618.

      Considering the CFA® charter? Download this free Before You Decide to Sit for the CFA Exam eBook.

      Consultant Salary—With the CFA® Charter

      Companies hire consultants to bring an independent expert perspective to business valuation, provide economic forecasts and analysis, and identify opportunities to grow shareholder value. The median base annual salary of CFA charterholders who work as consultants is $74,000, according to CFA Society Chicago.

      Risk Manager Salary—With the CFA® Charter

      Financial risk managers help identify and assess potential risks that a company faces or could face in the future. CFA Society Chicago reports that CFA charterholders who work as risk managers have a median yearly base salary of $126,060.

      Relationship Manager Salary—With the CFA® Charter

      Some CFA charterholders work to help their company maintain business relationships with partners and clients to prevent churn. These relationship managers average $120,000 a year, and they number about 5% of all CFA charterholders.

      Financial Advisor Salary—With the CFA® Charter

      A small percentage of CFA charterholders are financial advisors, helping clients make decisions about investments, tax laws, and insurance product selection. On average, they earn a median base salary of $110,000.

      Interested in Pursuing the CFA® Charter?

      Although earning the CFA designation does not guarantee you a job or a top position at a firm, it can make a difference when an employer is deciding between two otherwise equally qualified candidates. In that situation, the CFA charter could be your competitive advantage. Passing the CFA exam is your first step in earning the charter, and our CFA exam study materials can help.

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      Posted by Kaplan Schweser - December 17, 2020
      Photo showing payday for Chartered Financial Analyst salary earner

      What Does an Investment Banker Do?

      You’ve probably heard the title Investment Banker thrown around as a possible career path for you after graduation. When you hear this, you probably nod and say something like, “Yeah, I’ve thought about that,” hoping the person you’re talking to doesn’t take the conversation any deeper. Or maybe you’ve told your parents or friends you’re planning to get into investment banking, but didn’t really have a solid answer to their inevitable follow-up question: “What is investment banking?” So let’s start there.

      What Is Investment Banking?

      Thinking about careers after college can be challenging for finance students. With little to no experience in a corporate environment, it’s sometimes difficult to bridge the mental gap between what you’re studying and how you might apply that knowledge later on in your professional life. Before you decide to pursue a career in investment banking, you probably need to better understand what investment banking is and what investment bankers do. This article will simplify these concepts in a way you can understand, so you can make an informed decision about whether or not investment banking is right for you.

      As you’ve probably figured out, an investment bank is not the same as a bank where you set up your checking and savings accounts—those are called retail banks. In the simplest terms, investment banks help corporations raise money. When a corporation wants to buy or sell something, they work with an investment banker to figure out how to invest or attain the funds they need to get it done. Investment bankers help their corporate clients secure funds in the capital markets, act as financial advisors, and occasionally help companies navigate mergers and acquisitions.

      Interested in more advice from CFA® charterholders? Download this free Before You Decide to Sit for the CFA Exam eBook.

      An Investment Banker Analogy

      Let’s put the role of an investment banker into a real-world example that might hit close to home:

      Jenny is a college student (the corporation). Jenny wants to buy a new TV set for her apartment. The TV she wants to buy is $500, and Jenny only has $200 in her checking account. Jenny knows her parents aren’t going to fund the purchase, since they just spent $300 to fix her car a month ago. One night while texting with her older brother, Jenny explains her situation to him. Her older brother (the investment banker in this scenario) has a suggestion. He tells Jenny to check under the couch cushions and the ashtray in her car, and try to scrape together another $50 to get closer to the cost of the television. But he also suggests Jenny talk to her five roommates (potential investors). Since the TV will be placed in the living room of their new apartment, he advises her to ask them to chip in (invest) $50 for her purchase. The roommates will also be able to use the TV since they helped pay for it (capital gains for their investment). But when the lease is up and they go their separate ways, Jenny will keep the TV.

      Jenny’s brother played a critical role in helping her raise the money she needed to make her purchase. Without him, she would have never come up with the fundraising strategy he suggested.

      Investment Bankers Are Highly Valued

      Similarly, investment bankers are highly valued in the corporate world. Without them, it would be very difficult for companies to get the money they need to serve their customers and clients, or develop a strong competitive position in their market. Now that you have a better understanding of what investment banking is, it’s time to consider an internship so you’ll be better prepared for that uncomfortable question, “What are you going to do after graduation?”

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      Posted by Kaplan Schweser - December 17, 2020
      Investment banker in a suit walking upstairs into a client meeting

      CFA® Charter vs. CAIA® Charter: Everything You Need to Know

      In the finance world, there seems to be a sea (or is that a C?) of financial designations. Two of the most frequently mentioned are the CFA® charter and the CAIA® charter. If you’re thinking about becoming a financial analyst, these are two designations that can advance your career. So, what’s the difference and which is right for you? Let’s take a look at CFA versus CAIA.

      CAIA® vs. CFA® Charter: What Does Each Mean?

      The Chartered Financial Analyst® (CFA) charter is the professional credential offered internationally by CFA Institute to investment and financial professionals. The program covers a broad range of topics relating to investment and portfolio management, financial analysis, stocks, bonds, and derivatives, and provides a generalist knowledge of other areas of finance. Industry professionals worldwide recognize the CFA charter as the “gold standard” of all financial analyst designations.

      The Chartered Alternative Investment AnalystSM (CAIA) charter is offered by the CAIA Association. It is recognized globally as the benchmark for analysis, application, and standards of practice in the alternative investments arena. Alternative investments include real assets (e.g., real estate, infrastructure, natural resources, commodities, intangible assets), hedge funds, private equity, and structured products (e.g., collateralized debt obligations, credit derivatives). In other words, alternative investments are not stocks, bonds, and cash.

      Similarities

      Both are credentials for financial analysts, and both are earned by passing a set of exams called levels—you have to pass each level before taking the next. The exams require a great deal of study, practice, and commitment to learning and analysis, and all have a section on ethics and professional standards. To pass the CFA exams and the CAIA exams, you have to demonstrate knowledge of alternative investments.

      It is possible to hold both charters. In fact, CAIA Association is currently running a CAIA stackable credential pilot program that enables up to 500 CFA charterholders in good standing with CFA Institute to skip Level I of the CAIA exam.

      Differences

      The CFA charter requires knowledge and expertise in a much broader range of financial analysis topics, such as portfolio management, economics, reporting, quantitative analysis, and more. The CAIA charter is more specialized—its only focus is the world of real assets, hedge funds, private equity, CDOs, credit derivatives, and other structured products. Another difference is exam structure. The CFA exam has three levels, and the CAIA exam has two.

      CFA Charter and CAIA® Charter Requirements

      To become a CFA charterholder, you need to:

      • Have a bachelor’s degree (or equivalent) or be in the final year of your bachelor’s degree program. If you have 4,000 hours of relevant work experience or a combination of professional work and university experience that totals 4,000 hours, you are also eligible to start the CFA Program.
      • Take and pass Level I, Level II, and Level III of the CFA exam.
      • Become a member of CFA Institute (which costs $275 and includes agreeing to abide by its code of ethics).
      • Provide CFA Institute with proof that you’ve been working full-time for 4,000 hours in a role that either involves investment decision-making or with a product that contributes to that process. This can include any work experience you had before passing the exam, as well as after.

      To earn your CAIA Charter, you need to:

      • Take and pass the CAIA exams. There are no degree or work requirements for taking the exams.
      • Earn or finish earning a bachelor’s degree or equivalent and have at least 1 year of professional experience or complete a minimum of 4 years of professional experience without a degree.
      • Join the CAIA Association (which costs $350 and requires you to abide by their terms and conditions).
      • Submit two professional references to the CAIA Association.

      Considering the CFA charter? Download this free Before You Decide to Sit for the CFA Exam eBook.

      Exam Topics, Formats, Fees, and Pass Rates

      In a discussion about CFA versus CAIA, people are most likely to be concerned about the exams. Here’s what you need to know.

      The topics of the CFA exams are as follows:

      • Ethics
      • Quantitative methods
      • Economics
      • Financial reporting and analysis
      • Corporate issuers
      • Equity investments
      • Fixed income
      • Derivatives
      • Alternative investments
      • Portfolio management

      In 2022, Level I of the CFA will be offered four times a year. Level II will be offered three times a year and Level III will be offered twice. View specific CFA exam dates options.

      CFA exam fees range from $700 to $1,000, depending on when you register.

      Recent CFA Pass Rates »

      By contrast, the topics of the CAIA exams are as follows:

      • Professional standards and ethics
      • Introduction to alternative investments
      • Real assets including commodities
      • Hedge funds
      • Private equity
      • Structured products
      • Risk management and portfolio management

      Both levels of the CAIA exam are given in March and September. Level I is multiple-choice. Level II has a multiple-choice portion and a constructed response portion. There is a one-time enrollment fee of $400. The fee for each level ranges from $1,150 to $1,250 based on the exam registration period. If you want to retake the exam, the fee is $450.

      The pass rate for the Level I September 2021 CAIA exam was 51% and 58% for Level II.

      Preparing for the Exams

      Another similarity between the two charters is that the exams are nearly impossible to pass if all the candidate does is last-minute cramming. So, whether it’s the CFA Program or the CAIA exam, you should start studying early.

      To prepare for the CFA exam, CFA Institute advises a minimum of 300 hours of study for each level. You should focus on the Learning Outcome Statements (LOS) from CFA Institute because they detail exactly what you are expected to do on exam day. CFA study materials can really help, as will immersing yourself in practice questions. In addition, you should plan to take as many mock exams as you can to get used to the whole exam process.

      To prepare for the CAIA exams, the CAIA Association recommends more than 200 hours of study for each level. The Level I exam tests your knowledge of alternative investment concepts and tools. Level II evaluates your ability to apply those tools to analysis and investment. To pass both CAIA levels, exam technique is as important as understanding the curriculum concepts and topics. Therefore, it’s a good idea to enroll in CAIA prep classes, but you should also practice answering questions by taking mock exams.

      CFA Charter vs. CAIA® Charter: How to Choose

      Deciding which designation to pursue really depends on what you want to do as a financial analyst. If you’re interested in becoming a portfolio manager, research analyst, consultant, risk manager, corporate financial analyst, financial adviser, or moving into the C-suite, then the CFA charter will be a better fit. If you’re more interested in specializing in unconventional investments such as hedge funds or private equity, then the CAIA charter is right for you.

      Of course, you don’t have to choose at all. As we mentioned at the beginning of this article, you can hold both charters if you’re willing to put in the work. Today’s investors are becoming more interested in having conventional and unconventional investments in their portfolios, and with both credentials, you will be well-rounded enough to meet their needs. It’s more common for someone with a CFA charter to decide to sit for the CAIA exam, and with the new program that enables select CFA charterholders to skip Level I and take Level II, there’s no added incentive. But, earning the CAIA charter first has worked well for some investment analysts as well.

      No matter which path you choose, there is a wealth of information out there that can help you earn the credential or credentials you need. You can get started here.

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      Posted by Kaplan Schweser - December 15, 2020
      Fork in the road showing a decision - CFA charter versus CAIA charter

      Buy Side vs. Sell Side: Comparing Research Analyst Career Paths

      While the research analyst job title is frequently seen in the investment field, the job duties for a research analyst can vary considerably. One key area of variance is whether the position is on the sell side or the buy side of the industry. While both types of positions involve spending time researching companies and industries, the types of research conducted and advancement path is different. Read on to get a better understanding of buy side versus sell side and the career paths available in each.

      Buy Side vs. Sell Side

      Buy-side research analysts work for firms that purchase securities and other assets for the purposes of managing money. Sell-side analysts sell stocks, bonds, foreign exchange, and other financial products. That’s the very basic difference. But the differences go deeper when you take a look at the day-to-day work and responsibilities of buy-side and sell-side analysts.

      The Sell Side Explained

      Sell-side workers and firms create service products that are made available to the buy side of the financial industry. Individuals on the sell side are generally investment bankers, sell-side researchers, or traders.

      Sell-side research analysts do a great deal of in-depth research on companies within a specific sector of an industry. A key difference between sell side and buy side is that sell-side individuals go into a lot more depth in their research on a particular sector of an industry. They are narrow in focus and develop strong expertise, and then they provide reports to the public with recommendations and opinions. Buy-side research analysts often develop a list of go-to sell-side analysts in relevant sectors to get reliable reports and information.

      The Buy Side Explained

      Buy-side individuals work for institutions that buy investment services. Typical buy-side entities include private equity, life insurance, trusts, hedge funds, prop trading, venture capital, or pension funds.

      Buy-side research analysts do many of the same tasks as sell-side research analysts (e.g., reading news, reports, building models, etc.), but they focus on a broader knowledge area of responsibility to make the best recommendations possible for what stocks and financial products to buy. Buy-side research analysts are compensated more for the quality of recommendations they make, whereas sell-side research analysts are paid more for the quality of information they provide.

      Whether you choose buy side or sell side, having the CFA® charter can help you pursue a research analyst career. Download the free Before You Decide to Sit for the CFA® Exam eBook for invaluable advice from successful CFA professionals.

      Which Research Analyst Career Path Is Right for You?

      Both buy-side and sell-side careers can be lucrative, prestigious, and rewarding. The right path for you depends entirely on what is most important to you in a finance job.

      Job Tasks

      These do not vary considerably at the beginning of a career between the buy side and the sell side, but they do begin to vary significantly more as individuals move up in the ranks. On the sell side, the job functions remain focused heavily on financial modeling and analysis, but also incorporate report and investment opinion writing. Buy-side jobs, in contrast, vary widely as individuals move up. Investment bankers, for example, get more opportunities to work on mergers and acquisitions and other deals.

      Work-Life Balance

      If this is something that is important to you, a sell-side career may be a better fit. While both sides require hard work and long hours at times, a sell-side career has more phases of calm. Burnout is a common reason that individuals on the buy side leave the industry, but this is considerably less common on the sell side.

      Recognition

      There is more potential opportunity for recognition at the beginning of your career on the sell side than the buy side. Getting your name on research reports can help you build a strong name for yourself because they are often publicly distributed to clients and media outlets. As you become more senior on the sell side, you may become a go-to expert in your niche for the media.

      On the buy side, there is generally little opportunity for recognition at the beginning stages of your career. However, as you climb the ladder in your firm, there is opportunity to receive visibility later, particularly if you work on large, newsworthy deals.

      Opportunities for Advancement

      There are opportunities for advancement in both buy-side and sell-side jobs. However, buy-side jobs generally have a clearer path with timeframes. On the buy side, the path often goes analyst (2 to 3 years), associate (3+ years), director or managing director, or VP.

      The sell-side career path generally goes associate, analyst, senior analyst, and VP or research director. The timeline and path is less defined on the sell side, however. It can be more difficult to move up in these analyst roles because they are not making deals with clients and managing relationships like individuals on the buy side do.

      There are perks and downsides to both buy-side and sell-side jobs in the financial industry. Now that you have an idea of what each side is about, learn more about the steps to becoming a research analyst.

       

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      Posted by Kaplan Schweser - December 15, 2020
      Person doing research analysis at a computer desk with graphs

      What Does a Portfolio Manager Do?

      Portfolio managers are finance professionals who manage investment portfolios. Depending on the type of portfolio management job, a portfolio manager could work for individual clients or as part of a larger firm or financial institution. This article explores the day-to-day life of a portfolio manager and the types of potential portfolio manager jobs available.

      What Portfolio Managers Do: The Basics

      Portfolio managers spend a lot of their days researching current events and financial markets. Portfolio managers meet regularly with analysts to discuss the implications of market developments and current events. Both buy-side and sell-side analysts from investment banks present investment ideas to portfolio managers. The portfolio managers then need to sift through the information and make decisions about what securities to buy and sell.

      Not only do portfolio managers need to make investment decisions, but they are also responsible for meeting with investors, both in person and via phone or email, to explain their research, strategy, and rationale for decisions. There is also a large maintenance component of portfolio management. Adding an investment to the portfolio is not the end of the work for the manager. Portfolio managers must continue to pay attention to the portfolio companies and investments well after they are made and recognize when to hold or sell.

      If you’re thinking about becoming a portfolio manager, earning the CFA® charter can help. Download the free Before You Decide to Sit for the CFA Exam eBook for advice from successful CFA charterholders.

      Specializations in Portfolio Manager Positions

      Portfolio managers often specialize in particular areas of investing. The following are a few different types of specializations commonly seen in portfolio management.

      • Size of Fund: Portfolio management jobs can vary considerably based on fund size. Some may manage assets for small independent funds, while others will work for large asset management institutions. Some portfolio managers manage the capital of a large institution, such as a bank or a university with a large endowment.
      • Type of Investment Vehicles: While all portfolio managers manage assets for their investment vehicles, the range of vehicles varies greatly. These could include mutual funds, institutional funds, hedge funds, trust and pension funds, and commodity and high net worth investment pools. It is common for a portfolio manager to specialize in either managing equity or fixed-income investment vehicles.
      • Investing Style: Portfolio managers can also specialize in styles of investing. Some portfolio managers are specialists in hedging techniques, growth or value style of management, small or large cap specialties, and domestic or international fund investing.

      Portfolio Management Skills for Success

      Portfolio managers have big decisions to make and numerous reports to analyze every day. There are a number of skills necessary for success in the portfolio management sector, but here are four of the most important:

      • Innovative: All portfolio managers look at the index and news. The exceptional portfolio managers do outside-the-box research and know where to find information on potential investments that others do not. There is tremendous potential payoff for investors who can find a good investment that others failed to see.
      • Critical Thinker: Analyzing reports from financial analysts and other research requires portfolio managers to have strong critical thinking skills. Portfolio managers must be able to think through strengths, weaknesses, opportunities, and threats for every potential investment decision.
      • Decisive: Being a portfolio manager means making many investment decisions. There will never be any certainty in this industry; therefore, it is important that portfolio managers are good at evaluating options and making confident decisions.
      • Experience: Becoming a portfolio manager requires first working as a financial analyst and gaining important investment experience. The research analysts do informs the decisions portfolio managers make. Gaining experience as an analyst will help individuals better understand the life of a portfolio manager and see if it is a potential good fit.

       

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      Posted by Kaplan Schweser - December 15, 2020
      Portfolio Manager analyzing data for a portfolio on a touch screen

      What Does a Research Analyst Do?

      Research analyst is a fairly vague term that is used in a variety of fields. So it’s important to define it from a financial perspective. In the investment industry, a research analyst is sometimes more specifically referred to as an equity research analyst. Equity research analysts serve as investigators who analyze data, such as financial information, performance trends, economic trends and news, political climate, industry changes, and specific business developments, and they tend to go down one of two paths: buy-side or sell-side research. They synthesize their analysis of that data into a research report. That report is used to inform and advise traders and institutional investors on whether to buy, sell, or hold specific stocks. They usually have a degree in finance (often a master’s degree) or are CFA® charterholders.

      Balancing Analysis With Creativity

      While a research analyst must possess a strong analytic and financial skill set, the most effective research analysts understand that the trait that will set them apart from their peers is the ability to creatively extrapolate recommendations from the data they analyze. The ability to blend the data together, see what’s not visible to the untrained eye, form an educated opinion, and clearly articulate it, is as valuable to what research analysts do as their analytical skills.

      Considering the CFA charter? Download this free Before You Decide to Sit for the CFA Exam eBook.

      The Value of a Global Perspective

      Because a research analyst is required to, in essence, predict the future performance of a given company’s stocks, the analyst needs to understand how countries, economies, industries, businesses, and individuals are most likely to react to projected scenarios. For that reason, research analysts do need to be well informed on current events, as well as historical events as they relate to business. In order to achieve this knowledge, research analysts must do a lot of studying and reading. They read books on investment, international geopolitics, mergers and acquisitions, and economics. They also read the news. They analyze how particular markets or governments react to particular events. They develop an understanding of how certain events trigger other events, and how these triggers differ from country to country and industry to industry.

      Developing a strong global perspective through the analysis and understanding of past and current events allows a research analyst to more accurately predict reactions to predicted or possible changes. This gives the analyst a historical framework for providing recommendations based on sound evidence.

      Accountability and Responsibility Are Critical

      Research analysts are valued for their opinions. Those opinions are formed based on detailed analysis, historical trends, and a variety of other factors. Even though they are well-informed opinions, they are still opinions, so it’s important that research analysts be accountable for them. Even the best research analysts aren’t right 100% of the time. But a great analyst will understand the value that comes from making and owning a mistake—and they will dedicate themselves to finding out why they were wrong. While it can be said for all professions, a good research analyst becomes better at the job when they are willing to own and learn from their mistakes.


      Research analysts play a critical role for their firms and clients, helping to ensure no stone is left unturned before making an investment decision. They are compensated well for their work, because the role they play can make an enormous difference in the success or failure of the high-value investments on which they advise.

       

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      Posted by Kaplan Schweser - December 15, 2020
      Research analyst reading the day's financial news on a laptop computer

      How to Become a Stock (Equity) Analyst

      Stock analysts (often referred to as equity analysts) work in both buy-side and sell-side firms producing research reports, projections, and recommendations about stocks and companies. If you have a love of learning and data analysis, are a skilled problem-solver and are tenacious, you will thrive on this career path. Read on to learn how to become a stock analyst.

      Types of Stock (Equity) Analysts

      There are two types of stock analysts: buy-side and sell-side analysts.

      Buy-Side Analysts

      Buy-side analysts work for fund managers at mutual fund brokers or financial firms. They do research on companies in their employers’ portfolio and other potential company investment opportunities. Buy-side analysts generally have broader responsibilities, such as doing research on larger industry topics like technology.

      Sell-Side Analysts

      Sell-side analysts work for large investment banks. They do more narrowly focused research on a list of companies, often in the same industry, and provide reports to the firm’s clients. They build models projecting the firm’s financial results and interview customers, suppliers, competitors, and other sources with firm and industry knowledge. They provide a research report with financial estimates, a price target, and a recommendation about the stock’s expected performance. While buy-side analysts often conduct research on larger industries (e.g., technology), a sell-side analyst will do more focused research within an industry (e.g., software).

      Are you thinking of earning the CFA® charter? Download the free Before You Sit for the CFA® Exam ebook for invaluable advice from CFA professionals.

      The Path to a Stock (Equity) Analyst Career

      The path to a stock (equity) analyst career can vary. There are no formal education minimum requirements to become a stock analyst; however, most employers will ask for a bachelor’s degree in a relevant field of study, such as economics, finance, or statistics.

      The field is quite competitive to break into, so having a bachelor’s degree from a well-known, top-tier school could give more weight to your application. Getting an internship is another good way to get your foot in the door with a financial firm. It allows you to build a professional network and connect what you’ve learned in an academic setting to a real job.

      Many stock analysts earn the CFA® charter in order to distinguish themselves in the industry. The CFA charter requires a large commitment of time and effort. The average candidate studies for at least 300 hours per level (there are three levels). The knowledge gained from the CFA Program, however, is invaluable to a stock analyst. The curriculum goes deep into important topics for equity analysts, including financial analysis and reporting, equity investments, alternative investments, ethics, quantitative methods, corporate finance, and more.

      In addition to the CFA charter, many equity analysts get a securities license from FINRA. This licensing requires sponsorship from an employing firm, so most analysts do not get their securities licensing requirements done until they are hired by a firm.

      If you like diving deep into research and data, and you have the rigor to succeed in a high-pressure industry, being a stock analyst may be the right fit for you. Continue learning about the CFA Program, and Kaplan Schweser CFA exam prep.

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      Posted by Kaplan Schweser - December 15, 2020
      Person trying to find out what kind of job they can get after passing the Level I CFA exam

      Financial Analyst Career Path Options

      The term financial analyst is really an umbrella term that covers several different job titles. Four common job titles for financial analysts include fund manager, portfolio manager, risk analyst, and ratings analyst. Below, we’ve provided more details about each of these financial analyst career paths to help you decide which direction might best match your interests and aspirations.

      Fund Managers

      Fund managers, sometimes called mutual fund managers or hedge fund managers, oversee the stocks, bonds, and other assets a given fund will purchase on behalf of an investor. They have a strong understanding of the goals of the mutual fund and make decisions based on those goals. A fund manager will make decisions based on price-earning ratios, price momentum, sales, earnings, dividends, and a number of other fund characteristics.

      Fund managers are charged with buying and selling stocks and bonds. Sometimes fund managers operate alone, while other times they are a part of a team. Most senior fund managers begin their progression to the career by earning the Chartered Financial Analyst® (CFA®) charter.

      Considering the CFA® charter? Download this free Before You Decide to Sit for the CFA Exam eBook.

      Portfolio Managers

      Portfolio manager is another popular financial analyst career path. As a portfolio manager, you will work closely with other financial analysts and researchers to explore and analyze potential investment opportunities in corporations, develop a strong and active understanding of trends in investment, and predict future market conditions to help steer business and individual investment decisions.

      Portfolio management is a desirable career path for many new or aspiring financial analysts because of the high earning potential and the diverse activities of the day-to-day job. But it’s incredibly competitive and calls for long hours, as well as the inherent pressure of making decisions with someone else’s money. The ideal candidate for a career in portfolio management would be highly motivated and passionate about market and investment research.

      Ratings Analyst

      Ratings analysts make buy, hold, and sell recommendations based on their assessments and analyses of either entire industries or specific companies. Based on existing conditions and predicted changes, ratings analysts consider factors, like demand and operational conditions, to make educated decisions about whether or not an investor should make a purchase.

      Ratings analysts act as a layer of accountability in the market. In addition to analyzing the market, they are major proponents for corporate transparency and hold corporations to a high standard of honesty and accountability for their financial projections.

      Risk Analyst

      A risk analyst blends business and currency knowledge with analytical skills to help clients identify risk and, ultimately, minimize financial investment loss. Risk analysts often make risk limitation recommendations by encouraging diversification and currency exchanges.

      There is an inherent amount of risk that comes with operating in the global marketplace. A financial risk analyst acts like a counterweight, helping firms reduce that risk and make investing more sustainable. They are also often responsible for evaluating and reporting on asset losses, keeping track of investment trends, and collecting and analyzing data.


      As you can see, while there are a number of different financial analyst career paths, there are commonalities to the roles and responsibilities of each. Knowing a little more about the day-to-day tasks of each will hopefully help you identify which financial analyst career path best matches your skills and interests.

       

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      Posted by Kaplan Schweser - December 14, 2020
      Financial analyst trying to decide on a career path option

      CFA® Charter vs MBA: Which Direction is Right for You?

      It’s a popular question, and there is no shortage of opinions on the topic. But deciding between the CFA program and an MBA program is a very personal decision. As a finance professional, you would likely be very well served to pursue either. This comparison is not meant to call one out as a clear winner. There are a lot of variables that dictate which one might be the better option for you. And the truth is, many finance professionals choose to pursue both at some point in their career… although we wouldn’t recommend pursuing them both at the same time, at least while working a job as well.

      This article is intended to look at the particular characteristics of both paths and help you determine which is best for you, your lifestyle, and your career plans. Below, we’ve detailed a list of questions you’ll want to consider when deciding between the CFA Program and pursuing your MBA.

      CFA Charter vs. MBA: What do you want to do when you finish?

      This is perhaps the most important question to ask yourself when deciding between earning the CFA charter and earning an MBA. If you know you want to be a corporate financial analyst or portfolio manager, you would probably be best served by completing the CFA Program. It’s been said that the CFA exam is a foot wide and a mile deep. It won’t make you a stronger marketer. It won’t make you a better manager. It’s intensely focused on one thing: making you an investment expert. You will come out of the CFA Program with a specialized skill set for asset management.

      The MBA, on the other hand, is a broader approach. While the CFA Program is intensely focused, the MBA program is better defined as a mile wide and a foot deep. The skills you attain in business school are not focused on a single industry. Instead of intense focus on a particular skill set, you get some exposure to all facets of business operation. If you are still a little undecided about what industry you want to work in and feel like you need more practical exposure to a variety of business practices, the MBA path is probably the better choice for you.

      What About Earning a Masters of Science Degree in Financial Analysis?

      Sometimes, candidates looking to pursue the CFA Charter also may pursue a Masters of Science Degree in Financial Analysis (MSFA). Certain graduate programs are aligned to the learning outcomes of the CFA Institute’s CFA Program, which allows for students to earn an MSFA while simultaneously preparing for the CFA exam.  The College for Financial Planning's Masters of Science in Financial Analysis program includes access to Kaplan Schweser’s CFA Essential Study Package to prepare for the CFA exam.

      CFA Charter vs. MBA: What are you willing to spend?

      While your career plans should be the primary consideration, the cost is often a factor when deciding between an MBA and the CFA charter. There are costs associated with both. The CFA charter is relatively affordable when compared to an MBA, especially if you’re planning to attend a well-known business school. All told, you can complete the CFA Program with CFA premium exam prep materials for under $12,000. Business school tuition can cost $80,000 or more. That said, it really comes down to what you want to do with your career. You can’t put a price on job satisfaction.

      Considering the CFA charter? Download this free Before You Decide to Sit for the CFA Exam eBook.

      CFA Charter vs. MBA: What are you qualified for?

      To enroll in the CFA Program, you must meet one of CFA Institute’s qualifying criteria:

      • Have a bachelor’s (or equivalent) degree
      • Be in the final year of a bachelor’s degree program
      • Have 4,000 hours of professional work experience, or
      • Have a combination of professional work and university experience that totals at least 4,000 hours

      Business school requirements vary from school to school. You’ll want to make sure you meet the specific requirements of the school or schools to which you want to apply. Generally speaking, each school will require that you:

      • Have a bachelor’s degree
      • Complete the GRE or GMAT exam with a satisfactory score
      • Have professional work experience (varies by school)
      • Complete additional program prerequisites (varies by school)

      CFA Charter vs. MBA: What works for your schedule?

      If you dedicate yourself to being a full-time student, you can complete your MBA program in two years or less. Technically, if everything went perfectly, you could complete the CFA Program in 18 months, not including the time you spent studying for the Level I exam. But that would be a very intense 18 months of studying. It’s recommended that you spend 300 hours studying for each level of the CFA exam, but you can take a year off in between levels if you need without jeopardizing your chance of completion or significantly adding to the cost. On average, successful candidates take four years to earn their CFA charter, according to CFA Institute.

      Nearly all CFA charter candidates hold jobs while they prepare for and take the exams because they need to meet a work experience requirement before they can become a charterholder. The CFA exam is what it is…three levels, 300 hours each, and intense preparation. There is no shortcut. Whereas the option does exist to complete an MBA program part-time if you choose. It takes a little longer, but the option is available.

      For the most part, completing the CFA Program is something you do on your own, while an MBA program is typically a more socially communal experience, with an emphasis on networking and team projects.

      CFA Charter vs. MBA: How much do you hope to earn?

      Financial compensation is obviously a factor in your decision to pursue further education. But it shouldn’t be the biggest factor in deciding between the CFA Program and an MBA. According to Business Insider, the median compensation for a CFA charterholder with 0–5 years of experience is $72,900. The median compensation for a business school graduate with 0–5 years of experience is $57,700. Business professionals with 0–5 years of experience who have completed both programs have a median salary of $87,200.

      You are standing at a crossroads where countless others have stood. As you’re likely learning, there isn’t a single right or wrong choice that works for every individual. What you might see as a positive might be a negative to the next person in line. Consider all of the factors, make your decision with confidence, and don’t look back. Either way you go, you’re headed toward a brighter future in a finance career.

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      Posted by Kaplan Schweser - December 14, 2020
      Comparing life as an MBA to life as a CFA

      CFA® Charter vs CFP® Mark: Everything You Need to Decide

      If you’re thinking about a career in finance, you might have heard about the CFA® and CFP® designations. So, what’s the difference and which is right for you? This article will compare the CFA charter vs. the CFP® mark in detail, explore the similarities and differences, and arm you to make the best decision for your career.

      CFA® Charter and CFP® Mark: What Do They Mean?

      “CFA” stands for Chartered Financial Analyst®. It is the professional credential offered internationally by CFA Institute to investment and financial professionals. The program covers a broad range of topics relating to investment and portfolio management, financial analysis, stocks, bonds, and derivatives. Industry professionals worldwide recognize the CFA charter as the “gold standard” of all financial analyst designations.

      CFP® certification is a professional designation for financial planners. Also known as the CERTIFIED FINANCIAL PLANNER™ mark, its governing body, CFP Board, administers the credential. CFP® professionals help individuals create comprehensive plans for meeting their long-term personal financial goals, such as retirement, college tuition, business startup, a home, and so on. It is considered to be one of the most prestigious designations in personal finance or personal financial planning.

      CFA Charter vs. CFP® Mark: Similarities and Differences

      If you are interested in becoming a financial advisor, both credentials can serve you well, although the CFP® mark is the more common designation for that job role. To earn either mark requires passing exams. These exams require a great deal of study, practice, and commitment to learning and analysis, and they each include questions on the topic of ethical and professional conduct. Although a bachelor’s degree is recommended for both designations, you do not have to have graduated to begin the process of earning either credential.

      The differences between the two include the structures of their exams and the type of finance professional a candidate wants to be. The CFA exam has three levels, and you must pass all three to earn your charter. The focus of these exams is financial and investment concepts and how to apply them. By contrast, there is only one level of the CFP® exam, and it focuses on financial planning activities. The emphasis of each credential’s exam aligns with the career paths of those who earn the designations. CFA charterholders commonly help individuals and institutions invest and allocate assets. A CFP® professional is likely to be a financial planner, wealth manager, or financial advisor.

      It is possible to hold both designations. Having both the CFA charter and the CFP® mark signify expertise in institutional asset allocation and personal financial planning. This expertise is beneficial if your goal is to work with high-net-worth individuals in the field of wealth management or if you are thinking of starting a registered investment advisor firm. In fact, having the CFA charter can help you earn the CFP® mark.  CFP Board has approved holding the CFA charter as fulfilling most of the coursework requirements for CFP® certification.

      Considering the CFA charter? Before you choose your CFA exam date, download this free Before You Decide to Sit for the CFA Exam eBook.

      CFA Charter and CFP® Mark Requirements

      To become a CFA charterholder, you need to:

      1. Have a bachelor’s degree (or equivalent) or be in the final year of your bachelor’s degree program. If you have 4 years of relevant work experience or a combination of professional work and university experience that totals 4 years, you are also eligible to start the CFA Program.
      2. Take and pass the Level I, Level II, and Level III CFA exams.
      3. Become a member of CFA Institute (which costs $275 USD and requires agreeing to abide by its code of ethics).
      4. Provide CFA Institute with proof that you’ve been working full-time for 4,000 hours in a role that involves investment decision-making or with a product that contributes to that process. This can include any work experience you had before passing the exam, as well as after.

      Earning the CFP® certification involves the following steps:

      1. Complete a CFP Board-registered education program and make sure CFP Board is notified.
      2. Sit for the CFP® exam.
      3. Hold or earn a bachelor’s degree from an accredited university or college within five years of passing the CFP® exam.
      4. Demonstrate financial planning experience. This can be 6,000 hours of full-time, relevant personal financial planning or 4,000 hours of a financial planning apprenticeship.
      5. Pass CFP Board’s Candidate Fitness Standards.

      CFA Exam vs CFP® Exam: Topics, Formats, Fees, and Pass Rates

      Here’s what you need to know about the topics, formats, and fees of the exams for each designation.

      The topics of the CFA exams are:

      • Ethical and professional standards
      • Quantitative methods
      • Economics
      • Financial Reporting and Analysis
      • Corporate Issuers
      • Equity investments
      • Fixed income
      • Derivatives
      • Alternative investments
      • Portfolio management

      All levels of the CFA exam are offered several times a year and after 2020, they will be computer-based. You can learn more about when the exam will be offered this year by reading this article on the exam date. The format of the first two levels is multiple choice. Level III has a written portion called constructed response, along with a multiple-choice portion. CFA exam fees range from $700 to $1,450 USD, depending on your CFA exam level and when you register. The pass rates for the CFA exams are in this article.

      The topics covered on the CFP® exam include:

      • Professional conduct and regulation
      • General financial planning principles
      • Education planning
      • Risk management and insurance planning
      • Investment planning
      • Tax planning
      • Retirement savings and income planning
      • Estate planning

      The CFP® exam is a multiple-choice, computer-based exam. It consists of two 3-hour sessions separated by a 30-minute scheduled break. It is offered three times a year in March, July, and November at almost 50 locations nationwide, and it costs between $725$925 USD (depending on when you register). In 2019, the overall pass rate was 62 percent, and the pass rate for first-time exam takers was approximately 66 percent. CFP Board does not reveal the passing score.

      Preparing for the Exams

      Another similarity between the two designations is that the exams are nearly impossible to pass if all the candidate does is last-minute cramming. So, whether it’s the CFA exam or the CFP® exam, you should start studying early.

      To prepare for the CFA exam, CFA Institute advises a minimum of 300 hours of study for each level. You should focus on the Learning Outcome Statements (LOS) from CFA Institute because they detail exactly what you are expected to do on exam day. CFA study materials can really help, as will immersing yourself in practice questions. In addition, you should plan to take as many mock exams as you can to get used to the whole exam process.

      CFP Board recommends you spend at least 250 hours studying for the CFP® exam. You’ll need to pace yourself because the exam asks you to apply knowledge to case studies. So make sure you have the space in your life to dedicate the necessary hours to study. Most of the time, failing the exam is the result of not preparing properly. If you put together a stellar study plan and are willing to invest in exam preparation, you can increase your odds of passing.

      CFA® Charter vs. CFP® Mark: How to Choose

      Deciding which designation to pursue really depends on what you want to do in your financial career or what direction you want to take if your goal is to be a financial advisor. If you’re interested in becoming a portfolio manager, research analyst, consultant, risk manager, financial analyst, or investment banking analyst, then the CFA charter is a good fit for you. The most common careers for those with the CFP® mark include financial planner, wealth advisor, estate planning specialist, trading and research associate, financial representative, or a branch manager at a financial firm.

      Of course, you don’t have to choose at all. As we mentioned at the beginning of this article, you can hold both designations. It’s more common for someone with a CFA charter to decide to sit for the CFP® exam, especially since CFP Board waives much of its education requirements for CFA charterholders. But, earning the CFP® mark first has worked well for some investment analysts with CFA charters as well.

      No matter which path you choose, there is a wealth of information out there that can help you earn the credential or credentials you need.

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      Posted by Kaplan Schweser - December 14, 2020
      A sign showing a decision - CFA Charter verses CFP Mark

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