The Chartered Financial Analyst (CFA) designation is awarded by the global CFA Institute.
Requirements. Future CFAs enroll during the last year of a bachelor’s degree program or as graduated bachelor’s degree holders (or an equivalent of the bachelor’s degree as determined by the Institute). The program spans three years and three exams.
CFA designation remains highly desirable in the financial world. Students of the CFA program must have four years of related work experience. The CFA curriculum includes economics, finance, statistics, accounting and investment topics. Stocks, bonds, derivatives and other investment vehicles studied by investment analysis must be understood. The future CFA also studies ethics and best practices. The Code of Ethics includes the importance of
- placing clients’ interests above personal ones
- accuracy, competency, and respect for achieving accuracy
- continued education and improvement
The CFA examination of three parts–Levels I, II and III–challenges many test-takers. Level I studies focus on accounting principles and practice. Level I tests asset valuation, portfolio management and financial reporting. Level II adds asset classes, quantitative methodology and analysis of financial statements. Level III tests students’ abilities to apply what they have learned. Only 89,000 CFA charter-holders have earned this impressive designation.
According to CFA Institute (2010)42 percent of exam-takers passed the Level I compared with 46 percent in 2009 38,000 U.S. residents, 15,700 China residents, and 11,800 India residents took the Level I exam Students from 160 countries took CFA exams
How CFAs Work. CFAs work throughout the financial industry, in broker-dealers (the ‘sell-side’) and in asset management. They work in the alternative asset management industry, in hedge funds and private equity firms. Their ability to analyze, evaluate, assess, and dissect investments helps financial organizations around the world identify quality investment opportunities.
Average Compensation for CFAs. According to PayScale.com, CFAs earn median salaries of $51,000 with one year’s experience, $63,000 with four years’ experience and $90,000 with less than 10 years’ experience. Chief Financial Officers and Portfolio Manager roles earn more than others reported.