Chartered Financial Analyst (CFA)
“Whereas there are tens of thousands of finance
degrees available around the world, ranging from
excellent to the worthless, there is only one CFA
[designation] . . . . It used to be just an American
qualification. But explosive growth has made it,
in effect, a global currency. ”
The Economist
Statistics
• Over 93,000 investment professionals, including the world’s 79,000
CFA
• charterholders, in 134
countries: 85% are charterholders; 15% are noncharterholders.
• •30% work for Investment Companies/Mutual Funds
• •6% work for Hedge Funds/Fund of Hedge Funds
• •7% work for Commercial Retail or Mortgage Banks
• •4% work for Insurance Companies
• •2% work for Pensions and Foundations
• •11% work as Private Client Wealth Manager/Advisor
• •16% are employed by investment banks/broker dealers.
• •24% work for other organizations, such as consultancy, governmen
t/regulatory, academic or research firms
The CFA ®Program
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Administered by CFA Institute Program was established in 1962
The accepted benchmark for technical excellence in the financial
markets, due to:
Relevance of the syllabus
Rigor of the exam
High standards of professionalism it demands
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Entry Requirement
US Bachelor’s (or equivalent) degree or 4 years of qualified
Work experience
Final year of degree program
Earn the credential
Passing three sequential, six-hour exam
¾Working as an investment professional for a minimum of 4
years
¾Commit to abide by the CFA Institute Code of Ethics and Standards of Professional Conduct
Exam Fee
Examinations
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Multiple choice:individual multiple choice questions
1 question = 1.5 minutes
exam = 240 questions = 360 points
Level I all
Item set: vignette with set
of related multiple choice questions (items)
• 1 question = 3 minutes, 1 item set = 6 questions
• Level II exam = 20 item sets = 360 points
• Level III PM = 10 item sets = 180 points
• Level II all and Level III PM
Pass rate
Exam Content
• The CFA Program includes a series of three exams that are
offered in test centers around the world. These three
exams — Level I, Level II, and Level III — must be passed
sequentially as one of the requirements for earning a CFA
charter
• the Level I exam asks you basic knowledge and
comprehension questions focused on investment tools;
some questions will require analysis.
• the Level II exam further emphasizes analysis along with
applying your knowledge.
• the Level III exam focuses on synthesizing all of the
concepts and analytical methods in a variety of applications
for effective portfolio management and wealth planning.
Body of Knowledge
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Investment Tools
Ethical and Professional Standards
Quantitative Methods
Economics
Financial Statement Analysis
Corporate Finance
Asset Valuation
Analysis of Equity Investments
Analysis of Debt Investments
Analysis of Derivatives
Analysis of Alternative Investments
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Portfolio Management
Portfolio Management and Performance Presentation
Curriculum
• The topic focus and learning focus differ at each level
Level 1
Level 2
Level 3
Topic Focus
Investment Tools &
Ethical Standards
Asset Valuation &
Ethical Standards
Portfolio Management &
Ethical Standards
Learning Focus
Knowledge
Comprehension
Application Analysis
Synthesis Evaluation
• The curriculum at each level is organized into 18 study sessions
10 Topic Areas
SS
1
2-3
4-6
7-10
11
12
13-14
15-16
17
18
Topic
Ethics
Quantitative Method
Economics
Financial Statement Analysis
Corporate Finance
Portfolio Analysis
Equity
Fixed Income Securities
Derivatives
Alternative Investment
# of Questions
36
29
24
%
15%
12%
10%
48
19
12
24
29
12
7
20%
8%
5%
10%
12%
5%
3%