Devoted to understanding the basics and fundamentals of investing

I beg to differ. My experience with the CFA is it only matters in highly structured large investment organizations. In hedge funds, no one could care less.
Additionally, the CFA Institute appears to only care about growing dues fees, not sustaining the highest quality designation or lobbying the government regarding technical investment issues. During the tech bust of 1999-00, AIMR (aka CFA Institute) was completely silent on issues on Board reform, analyst malfeasance and other market reform issues.
I put my three years and got the letters but ever since then it has been a completely dissappointing experience being a part of this organization. I would not recommend it anyone else.
Just my two cents.

TechTrader,

Thank you for sharing your experience. Differences in opinion are what make markets. Out of curiousity, what percentage of your collegues at your shop have Ph.Ds versus MBAs versus CFAs?

I do know that CFA Institute is starting a new survey to determine the relevancy of the curriculum. It would be a great opportunity to put in your two cents worth so that it becomes a more relevant organization to your life.

You are an idiot.

Okay, I'll bite, why do you think I am an idiot? The top 3 definitions are: "1)A person without learning; an ignorant, uneducated man; a simple man; a clown, 2)A person so deficient in mental or intellectual faculty as to be incapable of ordinary acts of reaoning or rational conduct., 3)A term formerly used for the mentally ill." Oxford English Dictionary So, do any of these fit your concern? Share your reasoning.

Guys,

I am considering taking the CFA exams. When I saw that there were 4 comments to the article, I said "Great!". Unfortunately your comments have not been of any help. Guys be serious, do not waste people's time with nonsense.

Rio

Hi,

I have recently did my MBA. I came across the CFA site and saw the course content which was not only good but quite exhaustive. I am currently working in financial company. Could you please tell me will CFA help me in growing in the organisation.

Shantanu

Shantanu, tell me more about the type of financial institution you are working for and I will be able to give you a better anwer. At a bare minimum it will give you additional skills and open doors if you decide you are unhappy doing what you currently do. Tell me more about you and maybe I can help.

Larry

Hi,
I am from india. Could u please tell how does CFA stand in comparison to top ten MBA.

There are people who opine that both are same. But there are others who believe CFA is preferrd for asset management and investment management roles like equity research and portfolio management, whereas MBA is better for Investment Banking. Could anyone clear the picture a bit.

Also if a pure fresher with no experience whatsoever clear level 1 and level 2, will that help him in fetching a job and then pursue level 3 alongside. Or is it that its only after level 3 that u get a job.

Also since the syllabus of CFA is very very exhaustive, what's the bare minimum time one needs to put in for L1 and L2. I mean if i give (6 months 10 hrs a day daily) for each level devotedly, will it be sufficient?The institute recommneds 250 hrs which i dont think will suffice

Amit,
In terms of course content, most MBA programs require 20 classes. 10 of them are core classes, 10 are electives. You cover accounting, corporate finance, marketing, management, ethics, etc. It takes 2 years of full time school with an internship. Cost of tuition is about $70,000 and the cost of living for a top 10 school is about the same, so figure $140,000 or more for an MBA at a top 10 school.

You have seen the curriculum for the CFA designation. Year one is giving basic of definitions and calculations of what a security is. Year two is how to value a security and includes financial statement analysis. Year three is how to form a portfolio. The cost is a couple of thousand dollars total if you buy study guides and practice exams.

Starting salaries from a top 10 school are about $150,000 plus per year. Salaries for people with the CFA designation depend on the job and the country but are above the same jobs without the designation, usually by more than $20,000 per year.

I hope this helps.
Larry

Mr Larry Stay,
Thank you so much for your timely advise.

It would be really nice of you if you could tell me how CFA stands in comparison to an MBA when it comes to obtaining a job. I mean when it comes to asset management(equity research and portfolio management in particular), people say cfa is better than mba. But when it comes to I-Banking they say its the MBA which has the edge. Is it so?

Also, i wish to know from ur experience, is it such that in this profession there is an age-bias. I mean i have just completed my 29 with no work ex at all. If i manage to clear L1 and L2 by june 2007, i will be 30. So will i face some problems fetching a job due to my age factor.

Also, pls tell me about the time needed for preparation for L1 and L2. Will 6 months, 10 hrs a day suffice.

Warm Regards
amit

Amit, I agree with the assessment you have been given, that a CFA is better for Asset Management and an MBA is better for Investment Banking.

I do not believe there is an age bias in the Asset Management industry per se. I switched into a portfolio management job when I was 45. There may be an age bias at certain firms or in certain countries, but I think that firms are generally looking for talent not age.

I think you should study until you can reliably pass CFA practice exams with a 85% to 90% correct rate every time. I am talking about full timed exams. For me that took between 250 to 300 hours. I know most people who pass spend at least 200 plus hours studying.

Dear Mr Larry Stay,

Once again thank you very much for your opinion.

I will be ordering CFA Institute's book material for L1. Could you tell me few things in particular.

1) How much of statistics and mathematics is involved in the syllabus. I am from a non-maths and non-stats background.

2) How much does the institute's material assume a candidates knowledge in maths and stats.

3) Also if institute's material is covered thoroughly, will it suffice.

4) I did ask u about the age-bias. U said u faced no problems when u shifted at the age of 45. But in my case i am 29 without any work ex in any field whatsoever. I frittered away my time by idling at home. Now that i am serious about my future and totally focused, do u think its not going to be a major problem.

5) Also the most important thing which i wish to know is what kind of jobs a candidate can look forward to after completing L2. I have been told that L2 covers quite a bit of the whole body of knowledge of CFA and hence equips us technically significantly to be able to perform nicely in a job. Is it true?

I know my list is really very exhaustive. Sorry for bothering you once again.

Warm regards
amit

All of the math you need to do can be done on a HP 12-C or its equivalent. It is basic math, but there are lots of formulas and calculations. You do not need trigonometry or calculus to pass the exams, but you will use algebra. The statistics are again basic, you will learn to calculate the mean, variance, standard deviations, linear regressions, R squared, and various tests of statistical significance like the T-score, etc.

As I recall, the material assumes you know how to add, subtract, multiply, divide, use fractions, and how to use exponents. It doesn't assume any knowledge of statistics.

I believe you can pass the exam with the CFA Institute material. I chose to enhance my chances by buying supplementary review courses. I believe it helped me pass each level.

I don't know how to answer this question. It depends on how well you do and how well you interview. It depends on what country you interview in and who else is competing for the job. Obviously, someone with experience and a CFA credential will be hired before someone with just the credential. But, someone with the CFA charter will usually be hired before someone without it with similar experience.

I think you would be looking for entry level jobs as an analyst, a sales assitant, and other such jobs. You have to earn higher positions with on-the-job performance.

I think you can do the work for most investment industry entry jobs after passing the level II CFA exams. But, you need the complete package to continue progressing if you work at a CFA shop like I do.

hi,
this is junior in the Undergraduate school, my major is in Finance, i am good in math, economics, statatics, and probability. and next semester i will finished my one more finance investemnt course to get the concentration degree. i will plan to prepare my CFA test level 1 in Summer(2006), is it right time for me? what kind of book should i buy to study? is working experience related to the exam, i don't have any working experience. should i prepare exam right now in summer time, or should i do it when i graduate, i am confused.

hi,
this is junior in the Undergraduate school, my major is in Finance, i am good in math, economics, statatics, and probability. and next semester i will finished my one more finance investemnt course to get the concentration degree. i will plan to prepare my CFA test level 1 in Summer(2006), is it right time for me? what kind of book should i buy to study? is working experience related to the exam, i don't have any working experience. should i prepare exam right now in summer time, or should i do it when i graduate, i am confused.
thank u so much!

Kevin,

Lots of people start the CFA exam process while still in college. In the USA you can take the Level One exam in December and in June. Doing the study only in the summer will almost certainly lead to failure given the amount of knowledge you have to acquire, retain and apply.

When you sign up for the CFA exam, they give you a list of the books you need to buy and they provide you with all of the Learning Objective Statements that tell you what you need to learn. Most of the material has been assembled into a single book now. You used to have to buy several books per year. I have a whole shelf of books from the three year process. Now it will be more like three books.

Even after you pass all three years, you need four years experience in the industry before the CFA Institute will grant you your charter. But, having passed all three exams, you have an excellent chance at getting the job that will give you the experience. Good luck!

Hi,

Seems like I discovered this article pretty late. Not sure if anyone is still responding to it :(

I am doing CFA level 2 now. I was pretty psyched up when I decided to pursue my CFA designation.

Although i am doing quite well in another industry (IT), I feel that there's a part of me that want to get out of the mundane programming job that I am having.

This, coupled with the interest I have for investing, pushed me to pursue CFA and hopefully a career in finance.

After getting my level 1, I tried looking for jobs but to my surprised no one's really interested.

My resume wasn't some patched job as i spent alot of time customizing them when posting for different companies.
So let's assume my resume is reasonably well done...

This leave me to suspect that companies (large institutions especially) will look at age factors (I'm 27) if u are looking for entry level jobs (which is wat i am looking for although i do have transferrable skills like spreadsheet modeling)

So Larry, being a fund manager earlier in your career (or even right now?) do u concur if I were to make a bold statement: CFA is currently equals to what a degree was 5 years ago (i.e. a necessity).
It is a necessary standard. Period. Not a Gold standard.
You would probably be better off doing a easier degree if you are thinking of entry level analyst job and that's provided if you're young. I thank you for your time in advance.

Raymond,
Although it is illegal for employers in the USA to discriminate according to age, it is relatively easy to come to a good approximation. I'm sure some employers take it into account.

I am sure that for parts of the investment industry a CFA charter is becoming a necessity. However, for many other parts, it is just starting to penetrate. For example, people on the sales side of the business are just starting to see the benefits of earning a CFA designation. I see more of my brokers who sell to me going out to get it, even quite late in their careers.

I think you ought to get all the education you can and should never stop trying to improve your professional skills. I think a CFA credential is very useful to achieving that goal. Going the easier route leaves you worth less down the road. My 2 cents worth anyway.

Hi Larry,

I do agree with you that CFA is breaking into some parts of the investment industry. Nowadays even marketing guys in advertising shops (those that increase the awareness to less hyped IPOs) are getting CFA so that they can better understand the jargons used in the promotional materials. So yeah, I do agree with you on that one.

But the thing is, in the mainstream of the investment industry, CFA is probably less highly recognised. Reason is simple, there are just too many CFA charter holders out there currently. And from the looks of the increasing number of candidates taking the exams, this figure will be forming a bubble anytime soon. In my humble opinion, this bubble will burst. The effect will be less disasterous than a dot-com bubble or housing bubble unless most candidates take on huge debts to finance their education :P Of course it can be argued that money spent on education is never considered wasted but what I'm talking about here is actually the opporunity costs.

Think about the alternatives that you could have achieve if you didn't spent precious (and long) hours studying for 3 exams and only to realise that it isn't as highly sought after as CFA Institute claims.

Maybe my vision is short, maybe I'm just not experienced enough.. but my intuition tells me if supply is higher than demand...then price WILL fall.

Regards,
Raymond CHIAM

dear mr. larry stay
i am Abhimanyu from India.i am in the second year of Graduation.can i enroll for CFA program?

Dear Abhimanyu,

Yes, you can enroll in the program. You need to pass the three levels of the exams and you will need three to four years of experience in the industry to be awarded your charter. Once you have passed the exams, it is easier to get a job in the industry to get the experience you need for the charter. The CFA Institute website has all the details and requirements. You can find it at www.cfainstitute.org. Good Luck!

Dear Mr.Larry Stay,
thanks for the information.i want to know how much should i study every day to pass the examination with good grades/marks?
regards
Abhimanyu

Dear Abhimanyu,

In my opinion, you need to study 250 to 300 hours for each exam. I have some advice on studying for the exam in my post on January 20, "Study for the CFA". Good Luck!

Mr Larry Stay,
I got lot of info about CFA from ur previous writtings to others. But this time i want to ask you something if you dont mind to solve my case.
im B.SC(Economics) with stat & Math in graduation level from Univ. Of Calcutta, India. I got 1 year work exp. in an engineering firm as office assts. and now im working in a non-voice BPO centre. Sir could u suggest me which one b/t CFA & MBA(Fin) would be better for me as my career option.
thanking you.
Amit Bagani

what r the best institute in india to study MS(Finance)?

Amit, you are very qualified for many positions. MBA's are for people who wish to be in management (the Administration in MBA). The CFA course of study qualifies you for work in the investment world. You need to decide what career track you desire.

Sameer, I am truely sorry but I have no knowledge of the excellent institutes available to you for study in India. I do know that graduates from Indian institutes have been extemely successful around the world. Good luck in your search.

Mr Larry Stay,
thanks a lot for ur kind info.Being a person actively involved in today's economic functions what u suggest me to opt for? Actually i still have to decide. But advise from a person like u, would definately help me.
thanking you
Amit Bagani

Amit,
Do you enjoy the challenge of managing other people, giving them assingments, holding them accountable, providing feedback, hiring and firing? If so you may enjoy an MBA. You pay all of the money for an MBA to get general management skills in addition to the knowledge base of finance, marketing or other specialties.

Dear Larry,
thanks for ur kind advise. i will keep it in mind.I hope u will help me further. Anywaz pls take care & have a nice time ahead.
with regards
Amit Bagabi

Dear Mr Stay,
hi, hope you're doing well. i am Satish. i have a BA(Economics) with summa cum laude.i wan to know whether i should continue with my MA degree or opt for CFA? the most famous people from investment world have Economics degree.ex- warren buffett,george soros,edward lampert. would masters degree in Economics be very beneficial?

dear Mr larry stay,
i am ajay from india. i am doing my master's degree in accounting. there's an institute in india which offers a post graduate diploma in Securities market.i am sending you the brochure and course contents of this institute. kindly go through it and tell me if it would give me the same knowledge and skills needed in equity research and portfolio management. would it be same as CFA? please reply
regards
Ajay

http://www.utiicm.com/Smp/PDFs/Prospectus_2006_07.pdf
http://www.utiicm.com/Smp/PDFs/Prospectus_2005_06.pdf

Statish,
I use economics every day at work. If you read my posts you will see I look at where we are in the economic cycle and how they affect investments. Yes, I think economics is very useful.

But, having an undergraduate in economics and a CFA is a powerful combination.

Which you persue depends on what part of the investment world you want to work in. If you want to do mainly economic forecasts for others to use, get your masters. If you want to work more directly with investments, get your CFA.

Dear Ajay,
I reviewed the courses from the Indian Institute of Capital Markets. They offer a very thorough course of study, good internships and placement help. The course of study has a large degree of overlap with the course of study for the CFA designation.

The CFA course is a self study course. You do not have professors to explain things and answer questions. You need to be a self starter and motivated to do all the study required on your own. Your only feedback is whether you pass the exam each year.

If I were in your shoes, I would decide whether I did better in a structured environment or did better studying on my own. There is also opportunity cost. I was able to work while studying for the exams so I had income coming instead of pure outgo.

Good luck with your decision.

Dear Mr. Stay,
i am quite impressed by the course contents of Securities Market Program. do you think this course would be useful for careers in Equity Research or any other stock market related area?kindly give your honest opinion.

regards
Rahul

Dear Larry,
as per ur advise on 2nd May i did my search & finally decided to go for CFA.In india there is a institute named "ICFAI Univ. Hyderabad" I also visited www.cfainstitute.org. But u know Larry after returning home from my office i just get 2-3 hr. to study. Do u think that it would be enough to pass the same?Which institute u suggest for me keeping this thing in mind.I hope i will receive i +ve answer from ur end.
pls take care & have a nice time
with regards
Amit Bagani

Dear Rahul,
Yes, I think their course of study would be useful for careers in equity research and other investment related fields.

Dear Amit,

Yes, I think 2 to 3 hours of study per night is sufficient to pass the exam. You just need to start soon enough to make sure you have 250 to 300 total hours of study for each exam. Good luck with the course and I hope your dreams come true.

Alot of people are using CFA to get into the investment industry.
Most of them will be disappointed to find out that the passing all 3 levels may not even get him an interview, let alone the coveted job opening

dear Mr. stay,
can you tell me which firm you work for and what is your job profile?

Nick

Raymond, nice to have you back. I'm interested why you say that passing all three levels might not even get an interview. Do you have personal experience in this regards? While I am sure this must happen from time to time, in my experience this would be the exception rather than the rule. What have you seen?
Larry

Nick, please see my post for November 21, 2005 in the main archives, "Who the Heck is Larry Stay anyway?"

dear sir,
i am interested in a career in equity research/ investment management.i want to know how CFP and CFA are different from each other. for a career in equity research/ investment management , would CFP help?kindly advice.

Sincerely
David

Dear David, A CFP is to prepare an individual to give broad based financial advice to individuals. It is not designed to teach security analysis. See my post from April 25 for more details. If your desire is to be an equity analyst, a CFA designation will serve you better.

Since the internet and the ability to look up the highest paying certifications the number of CFAs are rising out of control. If you go to the Philadelphia testing facility on a test week you will see room after room at two or three convention centers filled. Far outpacing demand. Only get this if you like to or need to learn it. The average CFA salary will drop for the next 10 years. Thus MBAs who weed out 90% of applicants -- Harvard and Stanford are more exclusive thus valuable.

Thanks for the comment. I agree that the laws of supply and demand hold. If a local market like Philidelphia gets over supplied, average salaries will drop. By the same token the demand for services is accelerating as baby boomers start to retire and need more investment services. I'm not sure how it will all play out.

As for MBAs the supply is also exploding. They will compete with the Harvard and Stanford MBAs for jobs. Will the salary of the average MBA fall as well? The elite of either CFA credential holders or MBA schools will always find work. The average for both credentials will follow the laws of supply and demand.

I can address the C.F.A. vs. M.B.A. discussion from the perspective of Wall Street investment-banking firms, and my personal point of view, having worked for several "bulge-bracket" securities dealers (including Goldman, Sachs; what used to be Salomon Brothers; Lehman Brothers; and Banc of America Securities) for over 35 years.

All of these firms use an M.B.A. as a minimum requirement for any position above sales assistant. Having an undergraduate degree alone just won't cut it anymore. The M.B.A. is used as a cut-off criteria and a starting point for weeding out the many applicants seeking interviews at these top-rated investment banking firms. It is a requirement to even get your foot in the door now. There are always exceptions to the rule, but this is currently the rule. Don't kid yourself into believing otherwise. You may not want to hear that, or like it, but it's true.

To the extent that a candidate for a job in investment banking has a C.F.A. designation but no M.B.A., the C.F.A. is NOT considered a substitute for a masters degree, and the candidate probably won't even get an appointment for an interview. It may not be fair, but few things in life are fair. That's just the way the hiring process is managed in such a competitive industry.

However, to the extent that a candidate for a job in investment banking has BOTH a C.F.A. designation AND an M.B.A., that candidate is not only likely to get interviewed for a job at a top-rated investment banking firm, he is also likely to get hired for a job at a top-rated investment banking firm, and at the very top of their starting pay scale for that job. (The only way to make it big in investment banking today is to start big).

The M.B.A. for an investment banker is equivalent to a doctor earning an M.D. to become a family practitioner. The C.F.A. for an investment banker is equivalent to a doctor specializing in neuro-surgery (or orthopedics, or obstetrics and gynocology, if you'd rather compare it to something more interesting).

Being recognized as a C.F.A. is a highly regarded designation of proficiency and skill in a specialty field of study, but it is NOT considered a substitute for an advanced degree. In the one case, it's within the field of medicine; in the other case, it's within the field of finance and economics.

Earning an M.D. degree will allow you to practice basic medicine, and make a comfortable living doing it. Specializing in neuro-surgery, you are recognized by all M.D.'s as being qualified to operate on the brain, and generally provides you with the opportunity to make a fabulous income for the rest of your life, but you'll still need an M.D. degree to practice medicine, in the first place.

The other really important thing I want to tell you is that it isn't going to matter whether you have either an M.B.A. or a C.F.A., or both, if you can't construct a simple, gramatically correct sentence or spell the words properly on your resume. Not having command over the English language and an inability to spell are dead give-aways that your education is insufficient to meet the minimum job requirements in the investment banking business (or many other businesses).

Believe it or not, without the basic skills to communicate professionally, you aren't going to be taken seriously as an intelligent candidate for most jobs, and you certainly aren't going to work in a job where you are directly dependent upon other people to make a living, such as investment banking, no matter how many letters you earn and string out after the end of your name.

It is simply naive to think that age discrimination is not regularly practiced in the workplace. In an ideal world, this would not be the case, but we do not live in an ideal world, and it is frequently the case. It may be illegal, but it is certainly not uncommon. If you become a "mature" professional student without employment experience, you are at a huge disadvantage when you eventually get out there, armed with all that academic knowledge (and little else), to compete for a really good job.

Finally, don't overlook the importance of understanding the dynamics and principles of social psychology, or maybe even those of abnormal psychology (!), if you're going to target a job in any sales capacity of investment banking which will put you into direct contact with other highly educated professionals (and potential clients) like Larry Stay.

Great information Bob, thank you for your input. Do you think most credit analysts today have an MBA? What about the sales force you worked with when you sold bonds. What was their educational background? I'd really like to get some input on this. I've asked several times above and you are my last great hope for info for other readers. In the sturcture of the firm with Bankers (deal structurers), Credit Analysts (fundamental research), Portfolio Managers (asset allocators), Traders (buy/sell securities), and Sales (help the client find and trade what they need), Back Office and Clearing (adminsistrivia and control), what is the educational background you saw just before you retired?

Oh, and what did you see at your clients at Insurance Companies, Hedge Funds, Banks, Endowment Funds, Pension Funds and others.

My goodness, you sound absolutely desperate! Of course, I'll try to tackle your questions, but the opinions stated here are not necessarily those of my sponsors:

Most employees with any real responsibility above that of a sales assistant, working on Wall Street for bulge-bracket firms, have earned an MBA, or they wouldn't be employed on Wall Street by those highly competitive firms in the first place. (As I have said, now it's generally a requirement).

This goes for just about all of the true investment bankers (who put deals together), unless they have worked on Wall Street for so long that they were not required to hold an MBA (or maybe even a college degree) back when they were initially hired into the "biz," but those old-timers are truly fewer and farther between these days.

Credit analysts in particular are almost always MBA grads, and many of those same credit analysts also have earned, or are in the process of earning, a CFA designation. It helps to distinguish them from the pack, I think, and certainly makes them a more marketable commodity to other investment banking firms which are looking to upgrade their critical analytical personnel.

I can't speak with any certainty about Wall Street's fund managers (portfolio asset allocators), because there just aren't a lot of those guys working for Wall Street investment banking firms. Those who are generally manage money for one of a handful of Wall Street's owned internal hedge funds, or investment advisory funds, also owned by one of the top investment banking firms, i.e. J. Aron of Goldman, Sachs or the RAT (Merrill Lynch's Ready Asset Trust). Due to Chinese wall restrictions, those guys are generally housed in a separate building, or at least on a separate floor, ensconced in their spacious glass offices, with Musak softly playing in the background to drown out all the swearing when their trades don't go according to their model's prediction.

At a minimum, fund managers will not be found on a trading floor. More likely, they will be found hidden at a desk behind the curtains. For these and other reasons, most of the best educated fund/portfolio managers prefer the comparative freedom and/or increased financial recognition which they can generally find in the private sector (instead of Wall Street), managing multi-billion dollar fixed income portfolios for eleeomosynary institutions, for instance.

Consequently, I didn't have much contact with internal fund managers at the firms where I worked, but it's a pretty good bet that senior partners at Goldman, Sachs didn't turn loose some unqualified, inexperienced kid on a call director all day to manage their clients' funds. At least, not without a slug of D&O coverage!

Most traders and high-production sales personnel on Wall Street need to know what they're doing, most of the time, and what they're talking about, minute by minute, to their clients and colleagues, if they are going to establish and maintain any credibility with a broad universe of experienced, professional money managers (treasurers, CFOs, comptrollers, portfolio supervisors, etc.). If they aren't smart enough or likeable enough to set themselves apart from their competitors, then they aren't going to remain high-producers or successful traders very long, especially in an industry as cut-throat and merciless as that within which only the toughest survive. (Some of the people who work there aren't very nice, including me).

As I have said, almost all of these guys carry advanced degrees of one kind or another, and frequently are recognized with specialty designations as well, such as a CFA. However, it is within this class of Wall Street employees where you may find the exception which proves the rule. Not all traders and registered sales reps are uniformly well-schooled or seasoned in financial experience. That side of "the Street" is one of the last bastion holdouts in big business today where what you have consistently proven you can profitably accomplish (in either a sales or trading capacity) can still count for more than how many letters are strewn out after the end of your name. If you can consistently bring in highly profitable trades to the bottom line, without getting your employer consored or seriously fined by a regulatory agency, then you probably have a future somewhere on Wall Street.

Even sales assistants usually possess an undergraduate college degree, and many will try (often unsuccessfully) to leverage their position as a sales assistant into becoming a registered sales associate within a Wall Street firm. Sales assistants on Wall Street may be falsely encouraged by some senior management to keep their dream alive, but generally it is just a dishonest delaying tactic (at best) or a nefariously clever ruse (at worst), sometimes for an ulterior motive, to keep chewing up the sales assistant, draining her very life blood, until she finally gets discouraged to the point of quitting, or just gets spit out and discarded.

A good back-office clerk is worth his weight in gold. The back office can sometimes save your ass when no one else can. Fails-to-deliver can become frightfully expensive. A smart, heads-up back office becomes its own profit center by avoiding and correcting mistakes, saving significant amounts of hard-earned capital. You certainly don't have to be a space scientist, but a good working knowledge of mathematics, including fractional conversions, percentages, raising to a power, and subtracting to a root are all essential. However, many back office personnel do not hold any college degrees, let alone advanced ones.

The cleaning crew usually can't even speak broken English. No formal education is required. All they do most of the time is shake a rag or dust mop in the general direction of your work area, and sometimes might even move some of your little personal possessions from one side of your desk to another, if not out of your desk drawer into their purse. The cleaning crew's background is opaque.

Finally, I would have to admit that I was very lucky. My clients, as a class, were all highly educated professionals who were college graduates or higher. Many of them held MBAs. Fewer of them held CFA designations. But all had minds like a steel trap and memories like a filing cabinet. It was always fun, and frequently a challenge, for me to keep up with most of them! Some I couldn't, but then management on Wall Street has a tendency to match up their best with the brightest, and dummies with dummies.

Just remember: Where ever you are, there you go...

Thanks Bob for sharing your insights. I just opened a head hunter's job description for a Senior VP job with a Major bank. Here is what they are looking for:

The ideal candidate for the position of Senior Investment Manager should have an impressive financial services background focused on financial planning and investment management experience provided to the high net worth client. A minimum of 10 or more years investment decision making and investment consulting experience. This individual will have held positions of increasing responsibility with an established and prestigious financial services firm, most likely in a wealth management, private banking and/or Portfolio Management field, and in addition to an undergraduate degree in Finance, Accounting, Economics or equivalent, he/she must hold appropriate credentials such as a CFA and/or CFP designation. A graduate degree – such as an MBA is preferred but not required.

They are not quite so insistent on an MBA but definitely require a CFA or CFP.

Well, that's pretty definitive. I must have been completely wrong in my assessment of the relative values (CFA v. MBA) in today's business world. It happens. And many values, even when they still appear to be recognized or respected in today's workplace, seem to be continually shifting in their relative importance to business management. Either way, this just goes to prove why an education is a terrible thing to waste on an old, opinionated retiree like me.

Bob, you are too smart to really believe what you just wrote. One example does not make a rule. I think it just shows that for this bank at this time for this position they value one credential above another.

I still believe you should get all the education you can and that you should always have one eye on your next job should you need it. That means keeping the saw sharp through continuing education, reading, courses, credentials, etc. In fact, I probably ought to start on another credential myself, maybe a CFP?

That's one of the things I really do love about you, Larry: You are like Billy Budd vs. Captain Ahab, an innocent observor to the Great White Whale's treachery, almost naive to a fault in your interaction with the Ahabs of this world. You have an abiding faith in just about everyone (even an old reprobate like me).

The last sentence of my former comment (directly before this one) may have indeed been written with my tongue in my cheek, as opposed to my head up my ass, but my observation about the relative values within today's workplace having undergone a perpetual change in their acceptance of what is important one day but not the next, as common business practices, especially within the banking and securities industry, was meant to be deadly serious. It was, in fact, my intent to emphasize this unworthy dichotomy of principles paid lip service (and little else), by referring to what a prospective employer in its job description to a headhunter may advertise vs. what that same prospective employer may actually employ, as a matter of daily routine, in its actual hiring practices (i.e., hire the babe with the biggest boobs).
I'm only half-kidding.

Frankly, the question of whether or not a CFA or CFP was truly more or less valuable to a job applicant than an MBA wasn't even a consideration, from my perspective, in that last short observation, but was merely an excuse to use as an example of how relative values appear to shift "a`la mode" on Wall Street, from time to time and day to day.

Anyone who has spent as much of an undistinguished career commitment to that industry of big business as I have, and doesn't come away from it a bit jaded or cynical in his candid observations of how managers of many securities firms don't necessarily practice what they preach, most of the time, just hasn't been paying very careful attention to what has been going on around him in the last three decades, I am sorry to say.
Of course, you get an exemption from inclusion in this observation, Larry, due to your dedicated service to an investment advisory organization committed to a singularly unique charitable institution and great religious power, founded upon the very principles of belief and behavior which are altogether alien to most of those Wall Street investment houses.

The FACT of this observation doesn't make me particularly proud of the ethical practices (or lack thereof) within the general business industry today, but THAT is another subject for potential discussion, some other time, isn't it?

"I still believe you should get all the education you can and that you should always have one eye on your NEXT JOB SHOULD YOU NEED IT. That means keeping the saw sharp through CONTINUING EDUCATION, reading, courses, credentials, etc. In fact, I probably ought to start on ANOTHER CREDENTIAL myself, maybe a CFP?"

While I certainly agree with this portion of your response, and would encourage you to get your CFP, this does beg the question of whether or not a student enrolled in a CFP or CFA certification program, or a student enrolled in an MBA degree program, can claim a business expense deduction for tuition, books, and related expenses? With the high cost of attending most graduate schools today, a substantial amount of tax could be riding on the answer, particularly for an MBA student. Unfortunately, there doesn't seem to be any clear-cut answer.

The IRS says educational expenses are deductible only if you are REQUIRED to take the classes to KEEP YOUR PRESENT SALARY, STATUS, OR JOB. Alternatively, the education must MAINTAIN OR IMPROVE skills you need for your PRESENT work. The education CAN'T BE NECESSARY for meeting MINIMUM EDUCATIONAL requirements of your PRESENT trade or business, and it CAN'T BE PART OF A PROGRAM OF STUDY THAT WILL QUALIFY YOU FOR A NEW trade or business.

Having said that, interpretation of the law, especially IRS rulings, isn't always the easiest thing to do. Lots of people have screwed up trying. If you're seeking a degree, be sure you discuss your tax situation with an appropriate tax advisor first.

Deduct it on my taxes? I do need to talk to a tax advisor!

This is still a capitalistic society guys!! I’m going to enjoy myself while you guys stress out. It all comes down to talent. Making $250K a year is nothing if you are a business owner or professional trader. I don't desire a salary in my career goal because I'm an active derivatives trader morphing into a commercial real estate developer. My only interviews are with bankers and they don't care about CFAs or MBAs - they only want to see assets and profits to support my line of credit. If I got a CFA they would congratulate me, but if my deals didn't make sense financially they would withdraw the capital. An MBA and CFA are great if you want to collect a pay check from a large institution (ML or GS) which can let you go at any given notice. The job market (or economy) still dictates pay and openings. I encourage you all to define your goals and fulfill the necessary requirements. If you solely want to make money, make sure you know your stuff, but don't get bogged down with certifications because you can't sell them at retirement - they are not real assets. Its naive to depend on median stats to determine your pay; only you control your pay. If you are great at taking test then get 5 certifications/degrees and leverage them all to generate additional salary from your employer, but there is a limit. Performance will ultimately set your pay; if you’re not linked to company/trade profits or on commission you will be capped. Bonuses are discretionary. Also, don't get side-tracked with all these degrees; remember George Bush (our president) runs this country (more complicated than any investment shop) on his undergrad. degree and has made a boat load of cash in investments prior to his initial nomination – what a big exception. I know many CFAs and MBAs in my business that can’t afford some of the finer things in life because everything is contingent upon the company coin.

Hey Anonymous, if you can eliminate the stress factor from active derivatives trading or commercial real estate development by relying upon your talent alone, ignoring the value of your recognized achievements in self-education, and their corresponding influence upon your ability to manage your career decisions intelligently, then I applaud your independence and your success, but I also think you're flying half-blind in the traditional job market. Most of us, even as business owners or as professional traders, work with and for others to earn a salary, or commission, or bonus. It is the quality of those decisions we are capable of making, such as how to best employ our earnings, which determine the values we achieve in life. Our ability to structure those decisions in an informed and intelligent manner is directly attributable to our extent and degree of education (as both a formal and an informal discipline).

The MBA degree and CFA designation, as has been repeated earlier in this long thread of commentary, are merely measuring-posts of recognition that some of the workforce has achieved greater accreditation or certification to become qualified for greater compensation, responsibility, leadership, or wisdom (among other things).

It's a lot like living in a fiat economy, where the perceived purchasing power of a dollar (like the perceived value of earning an MBA or CFA) from a school like Yale, Harvard, Wharton, MIT, etc. is far less dependent upon the number of gold bars of bullion in Fort Knox, backing up the dollar (or the monetary cost of purchasing such a quality education in borrowed dollars), and instead is far more dependent upon the public's perception of confidence in the dollar's ultimate purchasing power (or the value of that quality education translated into earnings, amortized over the employment life of its recipient). Granted, there are plenty of bankers out there "in the business" who only care about ROA and profit-potential to support your line of credit, but a somewhat better educated banker might also care about whether or not his credit applicant had earned an MBA or CFA, because the very fact of earning such a designation tells the banker a great deal about his applicant's values, self-discipline, general intelligence, goal orientation, sense of achievement, tenacity, commitment, and character. Even if a deal makes sense to him financially, a savvy banker might just withdraw his capital from an applicant's backing, if he questioned the applicant's ability to achieve those necessary financial goals, in order for the deal to succeed.

Well-educated employees usually create their own job security, regardless of whether they are stand-alone entrepreneurs or earning income from a large financial services institution (like Merrill Lynch or Goldman Sachs). There are no economic certainties in life, and there are certainly exceptions to the rule, but those credentialed employees, hand-picked from the competitive pool of talent employeed at such large institutions, generally last longer than those who hang up a shingle on their own, venture onto the floor of the Chicago Board of Trade or Mercantile Exchange, and attempt to live by their wits alone.

Your advice to "define goals and fulfill necessary (job) requirements" is critical to success, and is excellent, as is "making sure you know your stuff."

Certifications themselves are not the real assets, of course. The real assets are the intelligent qualities and capabilities developed while pursuing those certifications. The certifications -- as I pointed out earlier here -- are nothing more than financial yardsticks used by employers to determine relative pay distinctions in a highly-competitive business, where teamwork often counts for more than super-stardom. And while overall performance, as narrowly defined in the view of your management, will indeed ultimately set your pay, certifications may initially allow you to compete as an eager participant for that pay, and help prevent your exclusion from consideration to participate in the future.

Very few of us make our livings in a vacuum. We become deeply dependent upon others, along the path of our career growth, to achieve recognition of our personal goals. In the process, we may have established a persona of fiercely solid independence in our efforts, but our true success (or lack of it) may well be determined by factors beyond our individual control. To that extent, we are all "capped" in our earnings potential. And boy, oh boy, bonuses ARE discretionary, to say nothing of being highly temporal and arbitrary too!

Finally, as you note, our President has (only) an undergraduate degree, and his startling lack of leadership reflects that limitation, I'm afraid, at many awkward times. A recent example of this was just demonstrated by his public statement yesterday on CNN, during his interview by Wolf Blitzer, on the nightmare of torture, mutilation, mass murder, civil war, and terrorism which Iraq has now become. George Bush stated, "...I like to tell people, when the final history is written on Iraq, it will look like just a comma..."

A comma in the scope of world history, indeed! A comma in the cost total, amounting to hundreds of billions of dollars, fighting a manufactured war, sold to the American public under knowingly false pretenses, mismanaged with incredible incompetence, mistakes, poor judgment, corruption, and violence for the last three-and-a-half years by our military Commander-in-Chief.

Tell the mothers and fathers and brothers and sisters of the 2700 American soldiers who have already died in this conflict that their sacrifices amounted to nothing "but a comma" in Iraq's history.

Tell that to the 20,000 American soldiers who have already been seriously injured in this conflict, maimed but not killed, due directly to President Bush's ineptitude and mistakes.

Off hand, I am hard pressed to think of a better example of insensitivity and uneducated ignorance.

hi.all
Iam having 3 yrs experience in engineeering industry in india as senior executive,age 25 and would like to switch over to finance area ,into the world of investments .i would like to go for CFA exam and would like to know whether it is worthwhile for me with an engg background to get a career breakthrough in investment related areas once i complete level 1 & 2.pls help me regarding this..is there people having similar profile who cleared CFA and working in investment field.

Larry -
I have a bachelors degree in Engineering from india, and i have been working for 2 years straight after graduation. I jumped into Business analysis last year as i was interested in learning about client engagements upfront and coming to the UK i have been fascinated by the financial world. I have been interested in the stock market back in india, but apart from understanding some basic fundamentals i do not have any financial/Commerce background. Finance has always been on my mind & hence I have decided to take up the CFA exam this december 07. I plan to do an MBA degree in 3 years down the line, but i wanted to study till i get the work experience, CFA sounds a degree worth the efforts and would help me in -

1. better understanding the financial world
2. Add value to my CV with better opportunities down the line.

I am 25 years old, and was a bit worried with how to proceed for the Level 1 CFA exam. I took a look at the study material and honestly could not understand much.

Is this common with other people new to finance. I am looking for some guidance in this direction and building up a network with people undertaking this exam...

I have read the previous posts and would not ask the same questions answered above - but i wanted a sense check from Larry.

Larry do you know any groups where i might be able to get in touch with people stiving to do the same. Anything Uk specific you might know

Cheers, Nitin

Dear Nitin,
I used a review course and outside study materials for each level of the exam. I probably would not have passed without them, as when I took the first one I found I was studying the wrong things. I highly recommend you contact your local CFA Society, http://www.uksip.org/ and they will be able to help you find the resources you need including study groups, outside vendors, etc. Good Luck!

I'm sorry this took a couple of days to answer, I developed a corneal ulcer Thursday evening and this is the first time I have been able to get back to the site to answer.

Larry

I am attempting to enter the finance field. I was having trouble entering at the level I preferred, so I am currently enrolled in a part-time MBA program. (The full time program is top-50) The question is can I depend on my MBA to get me in the door? If not, is there anything short of a CFA that will do it? I don't think I can take on the CFA until after school.

Another option is to go to an MBA program that is a CFA Partner. There is no reason to have to choose between a CFA designation and an MBA anymore. The CFA Institute has a program where it partners with universities (http://www.cfainstitute.org/cfaprog/university/partners.html). There are 30-40 partners and some of these universities have partnerships through their MBA programs and a few have student investment programs (e.g. www.uwasap.org) that focus on training students to perform investment research.

Thank you Larry and Bob for the discussions you've had awhile ago. I've found them more helpful than anything I've been told or seen before. It seems difficult to find meaningful advise these days and I'm glad I stumbled upon this discussion.

You are welcome. Let me know if I can answer any other questions or respond to thoughts you may have.

Larry

I just received an entry level position as a financial analyst with a company that deals exclusively with municipal finance. I was just wondering if the CFA program would be worth it for me. The majority of clients that we work with are school district and basically we assist them with financing project (borrowing on bonds/notes), government aid, arbitrage, and we also have to make sure that everything is in compliance with the law. Would a degree in Finance/Economics be more helpful than the CFA for me??

Mike,
I think you should always plan for your next position. A CFA won't do much for you in your current position, but if you like the industry and plan on growing in it you might want to consider getting the CFA.

A degree in Finance and Economics will help you in any business related field, not just investments. So, the answer as to which is best for you really depends on where you want to go with your career.

i took maths at O level but did not took it in A levels and i am thinking that i shud first go for ACCA then go for a CA AND THEN DURING CA i shud give CFA exams . so can u plzzz tell me that is it possible?. i am from pakistan and currently doing my A levels with three subjects i.e. accounting, economics, business studies and with only maths at O levels , is CFA possible? plzzz reply

i would be waiting for ur reply

i want to add one thing that i want to go for ACCA without training and then CA which starts directly with training ,if one has passed ACCA successfully, and only two modules are required in CA which are to be given during training if one has passed ACCA successfully. so my question is that can i give CFA exams during that particular training period?

Kaleem,
To pass the CFA exams it takes about 300 hours of study per exam. I think you would have a difficult time unless you never sleep. If you can fit another 300 hours of study into your schedule with all the other studies you are pursuing then you might be able to do it, but that is what it will take. Good luck, you sound like a very hard worker.

Larry

thank u very much for your reply ,sir. can u tell me the name of your country in which you live? this is only for information and one more important thing that i dont quite have a very strong maths background , however, i do know the basics of maths that are required in accountancy . so will CFA would be possible?

i would be very grateful to you if you answer these questions

sir larry , another thing that i want to ask is that i am at the moment doing my A levels(CAMBRIDGE BOARD) with three subjects i.e. accounting , economics and business studies ,so are these subjects fine for me if i want to opt for CFA after completing my ACCA(which i want to do after completing my A levels).

Kaleem,
I am in the USA. If you can handle basic algebra you should be fine. No trigonometry or calculus is required.
Larry

Dear Kaleem,
Yes, those are excellent subjects to prepare for the CFA. They will be useful for any business related career as well.

Larry

thank u thank u very much , one more thing is training required for CFA

Dear Kaleem,
In addition to passing the three exams you need to have four years of relevant work experience to be awarded your charter. If you pass the exams you should have no problem finding work in the industry.

Larry

thank u and where are u currently employed and what is your post there?

Hi Larry Stay,

I've read through your posts and sems like you're well informed it the finance industry. I'm in Uganda, East Africa. I started ACCA and just finished the first level. However I don't wanna balance and audit books. Wanna venture into CFA, Do you think that's a good move for Africa at this point in time? Most guys here are into Accountancy. Currently working with Shell Uganda, an Operating Unit of Royal Dutch Shell.

Hi Larry Stay,

I've read through your posts and sems like you're well informed it the finance industry. I'm in Uganda, East Africa. I started ACCA and just finished the first level. However I don't wanna balance and audit books. Wanna venture into CFA, Do you think that's a good move for Africa at this point in time? Most guys here are into Accountancy. Currently working with Shell Uganda, an Operating Unit of Royal Dutch Shell.

Hi Larry Stay,

I've read through your posts and sems like you're well informed it the finance industry. I'm in Uganda, East Africa. I started ACCA and just finished the first level. However I don't wanna balance and audit books. Wanna venture into CFA, Do you think that's a good move for Africa at this point in time? Most guys here are into Accountancy. Currently working with Shell Uganda, an Operating Unit of Royal Dutch Shell.

Mustafa,
I don't know much about the job market in your area. In general, I would say that there are usually more accounting jobs than investment related jobs in any economy. Usually, the investment jobs pay better because of relative scarcity of qualified practitioners. Also, you have to consider what you enjoy. Although I use it alot and am very conversant with accounting, I don't enjoy it and am glad that I am not doing it full time. So Mustafa, since you are not wild about accounting it would be worth your while to check out the job opportunities in investment related fields and see if there is a probability of landing a job if you get the training.

i am into appraisal of large projects with credit department of a bank. will cfa help going forward. i wish to continue in banking and that too in credit.
anonymous

No, A CFA Charter will probably not help you in credit analysis of big projects.

The curriculum is more general in nature than your assignment. The body of knowledge in the CFA is meant to give an overview of the topics important to the various industries involved with investing. Year two deals extensively with analysing financial statements. There is discussion of alternative investments that touches obliquely on your specialty, but not enough to be worth the effort.

Hi Larry,

I bumped into this forum by accident. I am a fresh graduate from a UK university with a BA in accounting and finance. I am currently thinking of doing CFA this december 07. Do you think it will help me to get my foot into the investment banks interview room by passing level 1 & 2 because I have been trying to look for a job in this industry since I graduate but hadn't been too successful well mainly because I do not have any prior working experience in this industry (that's what the agency told me). I am thinking of taking Level 1 this year and in the meanwhile applying for graduate training program. To be honest, I am not sure why I didnt manage to get any graduate job in this industry because personally I felt that I have done well in my degree with 2.1 and my uni is the top 15 in the UK. Please advise on the route I should take. Many thanks.

Dear Tammy,
Yes, I think it would help. I must say however that given your qualifications you may also need to work on your interviewing technique. See if you can get some people with interviewing skills to do some mock interviews with solid feedback to help you polish those skills. I found that to be very useful for me in the past and I do it for students at local universities. Little things can make a big difference in the success of your interviews.

Remember, you should plan on at least 300 hours of study between now and December if you wish to be fairly certain to pass level one.

Good luck in your job search!
Larry

Thanks for your reply Larry ;)
I got another questions. It's about ACCA and CFA. I know there are considerable amount of differences between these two qualifications. I have gathered several opinions from people taking these two papers but the answers I got are quite vague. Some people told me that by taking CFA I will be restrained to just analyst role as my future career whereas ACCA will provide with a broader career opportunities even in the finance industry. Is that true? I am not sure what my future career path will be because I don't have enough experience in the finance field for me to make an informed decision on the type of role I want to take or the division I want to work for. Do you think it's still good for me to take CFA or should I be taking ACCA instead. I hope I didnt confuse you. Thanks ;)

Dear Tammy,
The ACCA is an accounting certification. You can read about the course of study at the following website:
http://www.witanjardine.co.uk/accountancy-jobs/qualifications.asp

While accounting is useful for all finance related careers, most people who go through the ACCA will stay in accounting related jobs throughout their careers. Those interested in broader finance related jobs might get an MBA.

The CFA is for any job in the investment field. Many people start in an analyst job and move on from there. A natural progression is into portfolio management or private wealth management, pension management, endowment management, etc.

Dear Bob and Larry,
First off, thank you guys for taking your time and posting this topic. I’ve been inquiring into this question for some time now. I am 23 and have 4 months left in my master’s of economics degree. My career goals are to enter the asset management field. (hedge fund or mutual fund) I plan on getting an entry level job when I get out of school hopefully as an analyst. At the same time I was planning on enrolling into either a MBA program or starting with my CFA. Which designation do you think will help me more in my career goals? I was leaning towards CFA but would appreciate some feedback. Would all three (masters econ. MBA and CFA) be worth the time (opportunity cost) and money? Thanks again.

~Eric

Dear Larry,

Went through the posts, found it very useful.
Might sound repetitive,however would like to know
what's the major difference income wise..(Aiming for higher packages)
1.MBA (2 year full time) vs CFA
2.MBA (1 year executive program) VS CFA.
3.MBA (Distance learning)
I have got 4 years total experience in Financial institutions/BPO but in difference profiles altogether like collections (Which I hate )..loans processing in another company and finally retirement processing..
Since I am very interested in Finance, would like to do CFA as well I can earn tht degree while working.

Would love to do MBA as well but its time consuming(2 yrs) and expensive...which I cant afford @ my age of 26..:( 26 is major constraint since many would have completed MBA and CFA's by this age..:((

Plz lemme know your thoughts based on my experience.(pls note I have got my Bsc degree and not any finance degree).

Thanks a lot...

One more quick question...

How about Getting Certificate in Acturial Science...is it worth spending 4 years of your time while working to get this degree...since Came across many articles in India..(Am from India) that its worth taking up acturial science related course/Certificates..

Plz lemme know the difference b.w these 2...
Acturial science degree/certificate
vs
CFA..

Since both take 3-4 years time to complete...based on time available to study and clear these exams...

Thanks for your time and help..really appreciated..

Dear Eric and Meera,
I'm sorry for the delay in answering. First Eric. Once you are working for a firm your performance matters most. Credentials are most useful for getting to the front of the line for interviews when you change jobs. In my opinion the MBA would serve you best for hedge funds, the CFA best for mutual funds. Both of them are better.

Meera, it is not unusual to have 4 or 5 years work experience when you start an MBA. You generally can profit most from the classes when you have work experience you can relate the classes to. The CFA can be earned while you have a job. As I mentioned to Eric, credentials are most useful when you are changing jobs. If you are staying in your current job I would get an MBA at night to avoid the opportunity cost dropping out of the work force would cause. I would then get the CFA also while you are working.

Unless you are planning on working for an insurance company I would not get the actuarial degree. The pay is excellent and the competition is limited, but the focus is very narrow. The tests are among the most difficult to pass.
Larry

Larry,

Thank you for writing this article and responding to the questions many of us have.

I am also considering in pursuing the CFA charter. I am a CPA and also have a Series 7 and 24.

While my background is mostly on the regulation side of investments, I am certainly open to working on the other side of the fence as well. Would having the CFA and CPA open more opportunities? Would a CFA also be a good designation to have when working for a CPA firm? The reason I ask is that I don't anyone who has both designations. I know studying for the CFA exam is a big commitment and is expensive (relative to the exam and course fees when I took the CPA exam). Thank you in advance for your advice.

Mike

Mike,
I would give my eye teeth to have an auditor that understood what they teach in the CFA. I would think that having both credentials would only help you no matter which side of the aisle you decided to work on. I spend a significant amount of time teaching and reteaching each new auditor about some of the things that go beyond credits and debits in the investment world.

It's a lot of money and a lot of time however unless you have a specific need or plan in mind.

I hope this helps.
Larry

Thank you for your response, Larry. I'm sorry it took me a while to get back to you on this.

In regards to my prior post, I essentially wanted to know whether the CFA will greatly (or marginally) improve my marketability in terms of opportunities. According to your prior post it seems that it will help me greatly. I just don't want to go through the effort of obtaining the charter knowing the returns and rewards will be minimal. I have a solid background in securities regulation, including one year of audit. Also, since I have a M.S degree in accounting, and am still paying back my student loans, I think the MBA route (which will be much more expensive) is not an option.

I found out that a co-worker of mine is actually studying for Level I right now and I have to say that for someone just out of undergrad, it would be a much more difficult exam to pass as opposed to one who has several years related work experience. I am hoping that my securities background will help me grasp the material easier and my CPA will help with the financial statement analysis portion of the exam. If I decide to take it, I will likely start studying in January for the June 2008 exam. Would that allow me enough time to learn the material?

Thanks again for your insight.

Mike

Mike,
I don't know about your company, but for most companies an added credential of any kind gets you a pat on the back and an atta boy. Credentials become important when searching for a new job. Put yourself in the head of human resources spot. He has two candidates that have very similar resumes. One has the CFA charter and the other doesn't. Which will you interview first? The one with the CFA of course. But, then you have to sell yourself once you get the interview, the CFA designation won't buy you any slack in that process. I would say the credential will open many doors that you might otherwise have a hard time approaching. It increases your marketability greatly in getting you in the door. After that, you are on your own.

Many people start studying in January for the June exam. As long as you can put in 300 hours of study during that period you have a high likelyhood of passing level one. Your accounting background will help you alot during level two as long as you remember that you have to answer things the CFA way - that is with their slant on accounting. It is not different from the FASB rules, it just has a different emphasis.

Larry

Hi

I work in Software Testing in Banking related projects. (Currently working with one of the leading Investment Banking Firm).

I have some very basic experience on some of the investment banking products.

I have two questions ->
1. Will doing a CFA help me and will my current software experience count ?
2. How well is CFA recognized in India / Singapore?
(Like, what will be the average salary?)

Thanks

Dear Kanit,
1) It won't much, no it doesn't.
2) It is very well recognized and in demand. I don't know salaries there. You should be able to find them on Monster or some other job listing web service.

Hi Larry,

Thanks a lot for your answers.

Larry,

So it would be pretty much like changing my whole career and starting it afresh if i decide to pursue CFA. Is that a fair statement?

Thanks

You can earn a CFA charter while doing your current job. You can compare your opportunities in both fields and see which one offers the best possibilities. If you decide that influencing the investment decision in any of its myriad forms presents a brighter future then yes, you would be changing your whole career and starting afresh. But hopefully into something that makes you happier and provides better for your family if your research shows that to be the case.

Hi Larry,
Firstly, your replies to the questions posted above are very informative and helpful.I am glad I came across this web page. When you have a chance, I am hoping that you might be able to answer my question too.I have bachelors degree in commerce and an MBA from India. However, I have been working in the IT industry for the last 9 years as an Analyst and programmer. I am planning for a career shift to Finance jobs.If I were to go for CFA, what would be my chances of getting a job in USA? I am currently in USA and I would not mind joining as fresher again after my 9 years (will be 11 or 12 years actually when I finish my CFA) of work experience. I read in one of your posts above that age does not matter to the recruiter/employer.So, what I wanted to know was, what will be my chances of getting a job and what kind of salary can I expect (in USA)?
Thank you

Hi Larry,
I m parag from India .I m CA and 27 years old with one year post qualified experience . Do CFA with CA has additional benefits and better job chances ? CFA employers are mostly big firms , what is their selection procedure ,do they screen candidates on basis of graduation grades and college ? I have no experience in this area and i will be possibly 29 when look for job after passing L2 , does age is a factor for entry level employment in this area ?
Lastly what soft skills a cfa candidate has to develop in himself?
Thanks.

Hi Larry,
Thanks for the great work that you are doing here.
I did a BS Engineering and have been working in IT Industry for the last 9 years. For the last 2 years, I have been working for a company that creates software products for commercial leasing and lending. All of our clients are fortune 100 banks. During this time, I also started investing/trading in the equity and derivatives market and did a couple of courses in investment at community college. I'm really fascinated with this field and would love to switch to a finance career.
When exploring my options, I learned about CFA. I just went through the curriculum for level 1 and feel that I understand a lot of it already. I would love to pursue CFA. Please guide me if this will really help my situation or is it too late, i just turned 30.
Doing an MBA is another option, although CFA appears more focused, and is more friendly on the pocket.
Please advise.

Thanks a lot.

My current employer
I just got started on I have bachelors degree in commerce and an MBA from India. However, I have been working in the IT industry for the last 9 years as an Analyst and programmer. I am planning for a career shift to Finance jobs.If I were to go for CFA, what would be my chances of getting a job in USA? I am currently in USA and I would not mind joining as fresher again after my 9 years (will be 11 or 12 years actually when I finish my CFA) of work experience. I read in one of your posts above that age does not matter to the recruiter/employer.So, what I wanted to know was, what will be my chances of getting a job and what kind of salary can I expect (in USA)?
Thank you

Hello Larry,

I have an undergraduate degree in economics, and 3 years experience in the financial planning world (I have my series 7 and 66). I'm currently getting my master's in economics and I'm about to start my final semester.

How much preparation do you think I already have for the level 1 exam? I'm thinking about taking it in December, and I'm wondering if I can balance it with my final semester of classes. The exam for December falls 1 week before my finals start. The classes may actually help- one is security analysis and portfolio mgmt, the other is applied econometrics. I will not have a job during the semester, so all time outside of class (3 classes total) is my own.

Am I on a suicide mission trying to do this? My gut tells me I can do it but I'll have to put in the time. I would like an outside opinion, and obviously yours is valued.

Thanks a ton!

Dear Jammy,
When I was in my last semester of my MBA I was also interviewing for a job on top of the school work. I had been working full time and had to give that up. I don't think I could have done the CFA on top of classes and interviews.

If you are not interviewing for jobs, and think you have 300 hours to study outside of your class load you can do it. Year 1 is lots of formulas and "how to" stuff and requires lots of memorization and ability to apply the formulas quickly and accurately. You also have to get the ethics and it is with a CFAI slant, not the NASDAQ series take on it.

Good luck with your decision and let me know how it works out.

I wouldn't even waste my time unless I had a MBA from a ivy. These people from India have no hope of breaking into this market (life isnt far I know), the market is flooded, it's a boys club...

Hi,

This is Sophia from India. I just wanted to know about the career opportunities and the value addition CFA provides in Indian industry.Mainly in the investment research field Eg Consultancies

Thank you for your help here.

Sophia,
Thank you for your inquiry. Unfortunately, I have no information on your question. I do know that lots of young Indian professionals feel there are great career prospects. Over 9,000 of them signed up to take the exam last June. In the end, they were unable to sit for the exam in India due to a trademark dispute between the CFA Institute (the international parent organization of local societies) and an organization in India that has used the same letters for many years.

I hope this helps.
Larry

Hi Larry,

Thank you for your reply.
Could you also suggest if it would be better to take up the simmilar course available here in India or that provided by the CFA institute.Is this course also valid in India as in if I want to taka up a job in india.

Many Thanks,
Sophia