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        CHARTERED FINANCIAL ANALYST

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What Is CFA® Program?

 

  • CFA Institute was established in 1947. Over these 70+ years, The CFA® Program has emerged as the benchmark qualification for the investment industry. It has grown to over 150,000 charter holders around the world in more than 165 countries.
  •  
  • These charterholders today work as Portfolio Managers, Equity Research Analysts, Fund Managers, Wealth Managers, CFOs and Risk Consultants.
  •  
  • Completing The Program confirms mastery over the rigorous curriculum as can be evidence by you. Clearing all the three levels of the exam is the main requirement for earning the CFA® charter. It covers content required for investment industry segments like Equity, Fixed Income, Private Equity, Derivatives and Real Estate.

 

Why Should You Pursue This Course ?


Leading global recognition

 

  • These designation is one of the most recognised and respected investment credentials in the world with more than 60 years of legacy.

 

Better job prospects at the top investment firms:

 

  • The Program has an in-depth focus on financial modelling, portfolio management, and other investment related areas. Top investment firms, asset management, hedge funds value this knowledge base and give more preference to charter holders than other candidates from related fields.

 

Exposure to a variety of roles in finance

 

  • The Program is not just limited to investment banking and equity research, but plenty of other profiles as well. Today, be it Fintech, Foreign Exchange, Alternative Investments or other offbeat profiles, CFA® chartedholder are the most preferred options for employers.

 

Equipped for analysis and decision-making

 

  • It enables the students to be adept at decision making by incorporating reasoning and judgment skills in them

 

Enforces ethical standards

 

  • These charterholders upholds the highest professional standards and abides by a strict code of ethics.

 

Implements global best practices

 

  • Extensive ongoing analysis ensures that charterholders uphold the best global practices in their work.

 

Delivers practical, real-world skills

 

  • The charter is conferred after the completion of 4 years of relevant professional engagement, which means that the institute believes in practical skills. The curriculum is also designed in a way which helps you to tackle the real-world scenarios in an effective way.

 

More time and cost-effective than an MBA Finance program

 

  • The Qualification is one of the best options to an individual who does not have the time or the resources to go through a full-time MBA Finance program for entering the investment finance industry.

 

Networking opportunities for faster career growth:

 

  • CFA Societies® present worldwide give you access to more resources to boost your career prospects. Being part of these societies will not only increase your networking opportunity but also your chance of landing a dream position. They also post job openings specifically for charter holders.

 

 

 

Who Should Pursue This Course ?

 

  • Fresh Graduate: Any fresh graduate willing to make a career into the investment finance industry, will be equipped with the world class knowledge.
  • Investment Industry Professional: A candidate who is already working in the investment finance industry but wants to gain better understanding and recognition.
  • Academician: You are teaching investment finance in your university and college. This designation will give you the platform for better research and better credentials and acceptance
  • Self Understanding: If you are or willing to understand more about portfolio management or want to equip yourself to manager your wealth then CFA® designation becomes the right choice.

 

 

Relevance Of The CFA® Program In India

 

Indian KPO’s- Research

 

As International financial firms are focusing on the reduction of the cost of labour, they are outsourcing the majority of the work in India due to cost advantage. All the international KPO ’s, investment banking and financial servicing firms are looking for the highest credential in investment finance industry like CFA® charter, which is a  great opportunity for the CFA® charterholders in India.

 

Indian Brokers

 

Stock brokers in India which slowly reaching bigger scale of operations and international operations prefer candidates with the CFA® designation

 

Wealth Management Firm

 

Wealth Management Industry has been growing at a rate of 20% Y-O-Y. Since, a major proportion of HNIs are coming from India, the demand for CFA charterholders has increased tremendously

 

 

 

This program is split-up into 3 levels

 

  • Levels I, II, and III and the minimum time required to clear all three is around 2.5 years (although the overall average is around 4 years)
  • CFA Program charter membership requirements include, but not limited to 48 months of acceptable professional work experience and passing the Level I, Level II, and Level III exams

 

 

Eligibility

 

To be eligible to apply for The CFA® Program, you must hold a passport and one of the following:

Hold a U.S. bachelor’s (or equivalent) degree,


–    or be in the final year of your bachelor’s degree program ( any degree program)

 

To get the charter: Four years of qualified, professional work experience, in addition to passing the level I CFA exam, Level II CFA exam and Level III CFA exam.


–    or a combination of work and college experience that totals at least four years

 

 

 

CAREER BENEFITS

 

  • Portfolio Manager
  • Research Analyst
  • Chief Executive
  • Consultant
  • Corporate Financial Analyst
  • Financial Advisor
  • Relationship Managers, Sales, & Marketing
  • Risk manager
  • Investment Banking Analyst
  • Manager of Managers
  • Accountant/Auditor
  • Strategist
  • Trader
  • Broker
  • Performance Measurement Specialist
  • Private Banker

 

 

 

Exams

 

  • Are offered annually — at test centers around the world — on the first Saturday in the month of June. The Level I exam is also offered in the month of December.

          Must be passed sequentially.

 

  • Are available in English only.

 

Location: 

 

  • In India, CFA Institute conducts exam for June attempt in 10 cities: Ahmedabad, Bangalore, Bhopal, Chennai, Hyderabad,  Kolkata, Lucknow, Mumbai, New Delhi, Pune.

 

  • For December attempt exam is conducted in 5 cities: Bangalore, Kolkata, Lucknow, Mumbai and New Delhi

 

Negative marking: 

 

  • There is no negative marking in these exam.

 

Reattempt: 

 

  • There is no limit on the number of attempts for re-taking the exam but                 exam fees is needs to be paid separately for each re-attempt.

  •  

Grading Procedure:

 

  • The grading of the Program results happen on the basis of MPS ( Minimum Passing Score), after every exam a MPS is calculated based on the performance of a average candidate. Based on the MPS the student gets the result of the same.

 

Topic Weights By CFA Exam Level

 

 

All three levels of the CFA exam cover nearly all the same topics but at different weightings and depths. Here is the latest breakdown of topic weighting for all three levels.

 

 

                              Topic Area                               Level I                               Level II                               Level III

 

Ethical & Professional Standards                            15%                                  10-15%                              10-15%

 

Quantitative Methods                                               12%                                  5-10%                                  0%

 

Economics                                                               10%                                  5-10%                                5-15%

 

Financial Reporting & Analysis                                20%                                 15-20%                                  0%

 

Corporate Finance                                                    7%                                   5-15%                                   0%

 

Equity Investments                                                  10%                                  15-25%                               5-15%

 

Fixed Income                                                           10%                                  10-20%                               10-20%

 

Derivative Investments                                             5%                                    5-15%                                 5-15%

 

Alternative Investments                                            4%                                    5-10%                                 5-15%

 

Portfolio Management & Wealth Management         7%                                    5-10%                                40-55%

 

Total                                                                      100%                                     100%                                  100%

 

 

 

 

Exam Structure and Timing : Level 1

 

Structure: 

 

  • The Level I exam consists of 240 multiple choice questions, split among two 3-hour sessions. Candidates must attend both sessions

 

  • Morning session (3 hours): 120 multiple choice questions, covering all topics

 

  • Afternoon session (3 hours): 120 multiple choice questions, covering all topics

 

  • Timing: On average you should allow approximately 90 seconds for each multiple choice question. You may need more or less time, depending on the question and how well you understand the topic.

 

  • Exam Question Format – Multiple Choice Questions Each item on the Level I multiple choice exam consists of a question, a statement, and/or table and three answer choices: A, B, and C.

 

 

Exam Structure and Timing:Level 2

 

Structure: 

 

  • The Level II exam has a total of 20 item set questions:

 

  • Morning session: 10 item set questions

 

  • Afternoon session (3 hours): 10 item set questions

 

  • On the Level II exam, you will have a total of 120 items (20 vignettes with 6 items each) compared to 240 multiple choice items on the Level I exam.

 

  • The Level II exam is worth 360 points, corresponding to the number of minutes on the exam. The 120 Level II items are equally weighted, 3 points each, with no penalty for incorrect answers.

 

  • On the Level II (and III) exams, some topics are covered in the morning session only and other topics are covered in the afternoon session only.

 

Exam Question Format

 

  • When you prepare for the Level II exam, remember to review the Level I question format details for multiple choice questions. This same question construction applies to the multiple choices presented in item sets.

 

Item Set Format

 

  • Item sets are sometimes called “mini-cases.” Each item set on the CFA exam consists of a vignette (or case statement) and six multiple choice items (questions).

 

  • The length of a vignette ranges from about 1 page to 2.5 pages. The average length of the vignettes on the exam is about 1.5 pages. The longer vignettes are those that include several tables of information, such as for a financial statement analysis, statistics, or fixed-income item set.

 

  • The six multiple choice items in each item set can only be answered based on the information in the vignette. Hence, the items are not free-standing (as in Level I), but are drawn from the vignette. You will need to read the vignette before answering the items, and you will need to refer back to the vignette for information. The six multiple choice items can be answered independently of each other, but they do require information provided in the vignette

 

 

 

 

 

 

 

 

Exam Structure and Timing:Level 3

 

This is the last of three exams offered by the CFA Institute (formerly the Association for Investment Management and Research (AIMR)). This exam (in addition to other requirements) must be passed for an individual to become a CFA chartholder. The CFA Program is a globally recognized standard for measuring the competence and integrity of financial analysts. Level III explores portfolio management in great depth. You must demonstrate a working knowledge of the portfolio management process, from calculating investor constraints, objectives, and capital-market expectations to making asset-allocation decisions.

 

 

Exam Details

 

  • Time Limit : 6 hours

 

  • Number of Questions : 10-15

 

  • Passing Score : Varies Anually

 

  • Format : Essay Questions

 

  • Prerequisites : Passing grade on CFA Level II exam, and a U.S. Bachelor's degree or equivalent.

 

  • Corequisites : In order to receive your designation as a CFA charterholder upon successful completion of the level 3, you are required to have at least four years of                                       experience in a related field.

 

 

FAQ

 

What are the exam fees for all the three exams?

 

  • For the Level I exam, the candidate will have to pay one-time program enrollment fees of USD 450 apart from the Registration fees. The Registration fees for all the levels is the following

 

                               Registration Type                                Fees                             Deadline (Approx.)

 

                          Early Registration Fee                            USD 700                      8 Months before exam date

 

                          Standard Registration Fee                     USD 1000                    4 Months before exam date

 

                          Late Registration Fee                             USD 1450                    3 Months before exam date

 

 

How is the CFA® Program different from CA ?

 

  • The focus area of CA is Auditing, Accountancy, and Taxation whereas the focus area of CFA® Program is Investment Banking, Equity Research, Investment Advisory Services, Portfolio Management, Wealth Management, etc.

 

  • CA is a statutory qualification in India whereas CFA® Program is an international qualification recognized by any Investment company across the world.

 

  • You can start preparing for the CA right after the 12th standard whereas you can start pursuing the CFA® Program only after graduation.

 

  • CFA® passing rate is between 40% and 50%, whereas the passing rate for CA is typically less 

 

How is the CFP different from CFA® Progrm ?

 

 

  • Both the qualifications are recognized across the world. The focus of the CFP curriculum is only to make financial plans for an individual whereas the focus of the CFA® Program curriculum is to not only make financial plans but also capable to do research and work in other domains of investments finance industry.

 

  • CFA® charter holders work in financial areas that deal with institutional investments where as CFP Certificants are involved in advising individual investors, typically with smaller investment portfolios.

 

Recognition : 

 

  • As an analyst with a CFA® designation, you would intensively analyze individual companies and industries.

 

Area: 

 

  • The CFA® charter holders is oriented towards financial research and analysis whereas the CFP looks at investment planning for individuals.

 

Duration :

 

  • CFA® Programs takes at least 2 years to complete, while the CFP can be completed within a year.

 

Profile :

 

  •  After The CFA® Program, you can make a career in Portfolio Management, Investment Research, Advisory Services, or Investment Banking , while after the CFP you can make a career in the field of financial planning,

 

Eligibility :

 

  • You can start pursuing the CFP after the 12th while you can sit for the level 1 of The CFA® Program only after graduation or during the final year of your graduation.

 

Expenditure :

 

  •  Total expenditure of the CFP along with tuition fee is INR 50,000 to INR 60000, The  CFA®  Program expenditure is between INR 2.5 lakh to INR 3 lakh.

           Commitment: Compared to CFP, The CFA® Program exam is tough and requires more time commitment.

Salary :

 

  •  Average salary just after completing the CFP is in the range of INR 2 lakh to INR 3 lakh on the other hand after The CFA ® Program it is in the range of INR 4 lakh to INR 12 lakh.

 

Exams :

 

  • To get the CFA® designation, you must take three exams, each one in a separate year. The exams cover Finance, Accounting, Economics, Investments, and Ethics while in CFP you have to write five exams viz Investment, Retirement, Tax, Insurance and Advance Financial Planning.

 

 Work Experience :

 

  •  In both CFP & The CFA® Program, you need to meet certain education and work experience requirements. You need to have 4 years of relevant work experience for The CFA® charter and 3 years of relevant work experience for the CFP Certification.

 

 

I am a Engineer, how will CFA® Program will help me ?

 

 

  • CFA® Program is focused on Investments.

 

  • If you’re an engineer who wants to make a career shift to a financial field then the top priority should be a CFA® Program.

 

  • The engineering background gives him/her quantitative problem-solving skills. Along with this if she/he has a CFA® charter she/he is a perfect match for the investment industry.

 

  • If you’re good at numbers and have an interest in finance, you should do the CFA® Program Financial engineering/quantitative finance is a field where they like to hire engineers.

 

 

Should I do Financial Modelling with CFA® Program

 

  • The CFA®charter is a qualification whereas Financial modeling is a skill used in the investment finance industry.

 

  • The CFA® charter is an indispensable qualification for professionals who are looking for a long-term career in investment analysis. CFA® Program will prepare you conceptually for subjects such as Financial Reporting Analysis, Fixed Income, Economics etc.

 

  • In Financial Modeling you will learn how to use the concepts of Financial Statement Analysis, Economics in practice. In Financial Modeling you do all the calculations on excel whereas in the  CFA® Program you will solve all the calculations on the Financial Calculator. It will teach you to perform company valuations and make you job ready from day 1.

 

  • Many students do Financial Modeling first before pursuing CFA® Program, because it will help them prepare the foundation for CFA® Program at the same time it can help them get a job in Equity Research, Financial KPOs, etc.