What is CFA?
CFA Institute is the world’s largest association of investment professionals which is established in 1947. CFA Institute offices are located in London, New York City, Mumbai, Hong Kong, Beijing, Shanghai, Abu Dhabi, and Charlottesville, Virginia, USA. The Chartered Financial Analyst or CFA is a professional designation given by the CFA Institute that measures the competence and integrity of the financial industry, one of the most important designations among investment analysts and financial advisors.
Nowadays, students find different areas of study in order to settle in their careers. There are so many varieties of courses such as CFA, CA, LLB, MBA, and all. But among these all courses, CFA is the renowned and most recognized courses that many students want to complete. If you want to enhance the global financial market and help to manage the financial settlement, then this profession is perfect for you. If you are interested, then you should know what is CFA? Let’s check this out in details:
At first, you should know what does CFA stands for? The full form of CFA is a Chartered Financial Analyst. For investment professionals, this is one of the best and demanding designations. This particular program is totally aimed in order to increase investment management and global financial management profession. This program is specially designed to give the students knowledge about the professional career that is important for them. If you want to qualify a career in finance and establish the financial credentials as well, then the CFA examination is very much good and beneficial opportunity for you. Through this, course, you do not only improve you’re earning but also get a new aim in your career.
In this examination or course, the students need to qualify various levels of exams such as ethics, economic, accounting, money management, and analysis of security as well. You will have to know some of its key factors:
The CFA charter is one of the popular, well-known, and most recognized designations in the field of finance. In the field of investment analysis, it is considered as the gold standard. In order to become a charter holder, students need to pass three different and difficult examinations, the equivalent bachelor’s degree, and four years of experience in the professional field. If you want to pass the CFA exam, then you need to have strong dedication, discipline, and a huge amount of learning. You need to have diligence, endurance, and willpower as well. The communication skills, focus, self-motivation, and time management are very much important in order to qualify these examinations and become a Chartered Financial Analyst.
Students who pursue this particular course gain deep knowledge about the investment industry and they eventually get high-paying amount jobs.
This particular program is very beneficial for those who want to build a long term career in sectors like banking, financial services, and corporate area. Due to the factors like industrialization and globalization, this course increases its demands in India. From the year 1963 to 2016, total 1,348,103 aspirants sat from this particular Level I examination, and 209,561 aspirants passed the Level III examination.
The aspirants need to study a minimum of 300 hours for each level of examination. It is a very difficult examination. The institute of CFA was established in the year 1947. It has emerged its benchmark in the financial industry as well.
Benefits of CFA examination:
If you want to pursue the CFA course, then you will get plenty of career options after passing and completing the three levels of CFA examination. In the competitive platform of today, the CFA chartered holders gain the importance for their expertise and skills. In the field of professional finance, this course is playing the role of a career enhancer. If you have a CFA degree, then these are such recruitments for you:
Requirements of CFA examination:
If you want to clear the CFA exam and earn the degree of CFA charter then you will have to require these all:
You must have a bachelor’s degree. Four years of experience in the professional working platform.Total of four years of experience in both education and work.
Apart from these, the students need to have all these as well:
The students need to be a member of the CFA Institute. They need to apply for membership in local CFA society.
If you want to pass the exam then you should know all these:
The aspirant or the candidate needs to complete all the levels of the CFA examination. After clearing the level of three, the students need to have the work experience as mentioned earlier. It should be prescribed by the CFA Institute as well.
How to become a Chartered Financial Analyst
If you want to become a CFA holder, then the most important step is to pass the three-level of examination. But before that, you need to enroll in the CFA program. You will have to pay the enrolment fee of $450. You must have an international travel passport for this as test centers are located all over the world except Cuba. You need to study the curriculum and take the examinations in the English language. If the student lives in Cuba or the Crimea region of Ukraine then they cannot sit in the examination. Each exam of CFA is administrated once a year. But the CFA examination Level I is only administrated twice a year. If you want to move to level II then you need to pass the level I at first.
At the time of enrolling for the CFA program, you will have to fulfill the Professional Conduct Statement form and by this, you are affirming the CFA Code of ethics and standard professional conduct.
About the examinations and requirements of CFA:
CFA examination is very much well-known for the finest financial exam in the whole world. This particular test is just for checking your core financial and technical knowledge. So, for holding the CFA charter, you must pass the three levels of examination such as level 1, level 2, and level 3. All the examinations of CFA are held in the month of June but the level 1 examination also held in the month of December.
The syllabus for each examination of the CFA program is based on the curriculum proposed by the CFA Institute. The students need to read at least 300 hours for each level of examination.
CFA Exam Score Table
|Topic Area||Level I||Level II||Level III|
|Ethical and Professional Standards||15||10-15||10-15|
|Financial Reporting and Analysis||15||10-15||0|
|Portfolio Management and Wealth Planning||6||5-15||35-40|
What does the CFA Level 1 cover?
CFA Level 1 covers the Investment Tools topic where candidates get knowledge (Knowledge and comprehension) of ethical and professional standards.
In order to register in this program or sit for the level 1 examination of CFA, you need to complete your bachelor’s degree or be the final year student of the college. Apart from this, you need to have four years of experience in full-time professional work. Or else, you may have a combination of college and professional working experience. In the level 1 examination, you need to give the answers of the 240 multiple-choice questions. These questions are divided into two sessions. Each session needs three hours. The pass rate of this level of examination is 43%.
What does the CFA Level 2 cover?
CFA Level 2 covers the Asset Valuation topic where candidates learn how to apply standards to situations analysts face (Application and Analysis)
For sitting in the Level 2 examination, you will have to pass the Level 1 examination and must complete the bachelor’s degree as well. The structure of the Level 2 examination is totally different from the Level 1 examination. But the question pattern is also multiple choices. In this level, the format of the exam is 20 small set of case studies and six multiple-choice questions for each 20 set. You need to answer a total of 120 questions. This examination also divided into two parts- one in the morning and another in the afternoon. The pass rate of this level 2 examination is 45%.
What does the CFA Level 3 cover?
CFA Level 3 covers the Portfolio Management topic where candidates learn the standards in portfolio management and compliance context (Synthesis and Evaluation)
This examination also held in the month of June every year. In this last exam of the CFA, you will have to give answers eight to twelve essay type questions during the morning session examination. In the afternoon session, you need to complete 10 vignettes followed by six questions. You must pass the Level 2 examination before sitting for the Level 3 examination. The pass rate of this level 3 examination is 56%.
Limitation of the career in CFA:
It is a respected and world-wide famous designation. But it is not guaranteed to reach the high level of richness and glory. Before applying for this course and sitting for the examinations, you need to know the drawbacks of this particular career. After doing the CFA career, you cannot quickly fix the earning and earn a huge amount of money from a reputed job. It is quite a complicated and time-taking procedure as well. You need to have patience, diligence and dedication as well to pass these hard levels of examination and pursue your career in this particular field. If you fail in one examination and apply for a retake, you must compromise your time and relation with your family, relatives, and friends.
Apart from the time, dedication, and willing power, the monetary problem is also there. You will have to spend a quality amount of money in order to buy books and study programs as well. So, before going too further, you will have to consider these facts.
You can get so many tips from the internet, but it is better to have the knowledge from the experienced person or the senior students regarding the CFA curse and gather some practical knowledge. Some topics we from CFA we will cover in our section Finance education.