CFA [Chartered Financial Analyst]

The Chartered Financial Analyst (CFA) Program is a post-graduate professional qualification offered internationally by the American-based CFA Institute (formerly the Association for Investment Management and Research, or AIMR) to investment and financial professionals. It has the highest level of global legal and regulatory recognition of finance-related qualifications. The program covers a considerably wide range of topics relating to advanced investment analysis and thus- security analysisstatisticsprobability theoryfixed incomederivativeseconomicsfinancial analysiscorporate financealternative investments and portfolio management - and provides a generalist knowledge of other areas of finance.

A candidate who successfully completes the program and meets other professional requirements is awarded the "CFA charter" and becomes a "CFA charterholder". As of October 2019, there are at least 167,000 charterholders around the world in 164 countries, growing 7% annually since 2012. Successful candidates take an average of four years to earn their CFA charter, with around 9% of candidates having consecutively passed all three levels in the past decade.

 Why the CFA Program Is Right for You

As an aspiring or practicing investment professional, you need the knowledge and skills to thrive in a highly competitive industry. The CFA Program is  designed to equip you with the kind of expertise and real-world skills in investment analysis that will help you advance your career. Whether you are a practicing investment professional, a student, switching careers or looking to start a career in this field, the CFA Program offers a way to move forward and achieve your professional goals.

CFA Program Benefits

Designed with your future in mind, the CFA Program provides a strong foundation in advanced investment analysis and real-world portfolio management skills. Ongoing input from industry experts ensures that the curriculum remains relevant and prepares charterholders to enter today’s market.

CFA charterholders occupy a range of investment decision-making roles, typically as a research analyst or portfolio manager. CFA charterholders go on to enjoy lifelong careers in asset and wealth management, investment banking, commercial banking, and consulting, alongside a diverse range of career paths in-and-outside the industry.

As a globally recognized credential in the investment management profession, earning the CFA charter demonstrates to employers that you have the knowledge and commitment to thrive in today’s complex and evolving investment industry. The CFA® designation is a mark of distinction, and investment firms know it represents a higher standard.

Why Choose a Career in Investment Management?

Firms and professionals in the investment management industry are stewards of capital – they help clients make investment decisions, invest their money, and provide services to enhance financial markets. The scope of these services can include trading, asset management – constructing and managing investment portfolios and funds – and regulation of these systems. Enrolling in the CFA Program and earning the CFA charter prepares and positions you for a variety of career paths in the investment management industry.

 Explore Core Curriculum Topics 

The focus of this topic is ethics, related challenges to ethical behavior, and the role ethics and professionalism play in the investment industry. We provide a framework to support ethical decision making and examine CFA Institute Code of Ethics and Standards of Professional Conduct and Global Investment Performance Standards (GIPS®).

In this section, we explore quantitative concepts and techniques used in financial analysis and investment decision making. We present descriptive statistics for conveying important data attributes, such as central tendency, location, and dispersion, and introduce characteristics of return distributions. The section also considers probability theory and its application in quantifying risk for investment decision making.

Weight Given Across Levels

Level I

Level II

Level III

8–12

5–10

0

 

In this section, we introduce analysis of fundamental concepts of supply and demand for individual consumers and firms. We also cover the various market structures that firms operate in as well as macroeconomic concepts and principles, including aggregate output and income measurement, aggregate demand and supply analysis, and analysis of economic growth factors. The section concludes with coverage of the business cycle and its effect on economic activity.

Weight Given Across Levels

Level I

Level II

Level III

8–12

5–10

5–10

 

Here we provide a thorough explanation of financial reporting procedures and the standards that govern financial reporting disclosures, with an emphasis on basic financial statements and how alternative accounting methods affect those statements and the analysis of them. We examine primary financial statements and provide a general framework for conducting financial statement analysis.

Weight Given Across Levels

Level I

Level II

Level III

13–17

10–15

0

 

In this topic, we provide an introduction to corporate governance as well as investing and financing decisions. We present an overview of corporate governance along with a framework for understanding and analyzing corporate governance and stakeholder management. We also highlight the growing impact of environmental and social considerations in investing. We cover how companies make use of leverage and manage their working capital to meet short-term operational needs.

Weight Given Across Levels

Level I

Level II

Level III

8–12

 

5–10

 

0

 

Here we explore the characteristics of equity investments, security markets, and indexes and explain how to analyze industries, companies, and equity securities as well as the use of basic equity valuation models. Global equities are important for meeting longer-term growth and diversification objectives.

Weight Given Across Levels

Level I

Level II

Level III

10–12

10–15

10–15

 

In this topic, we explain how to describe fixed income securities and their markets, yield measures, risk factors, and valuation measurements and drivers. We also cover calculating yields, values of fixed income securities, the securitization of assets, the fundamentals of bond returns and risks, and basic principles of credit analysis.

Weight Given Across Levels

Level I

Level II

Level III

10–12

10–15

15–20

 

In this section, we build the conceptual framework for understanding the basic derivatives and derivative markets. We then introduce essential features and valuation concepts for forward commitments such as forwards, futures, swaps, and contingent claims. Finally, we examine arbitrage, a critical concept that links derivative pricing to the price of the underlying asset.

Weight Given Across Levels

Level I

Level II

Level III

5–8

5–10

5–10

 

This topic explores alternative investments, including hedge funds, private equity, real estate, commodities, and infrastructure. We cover the use of alternative investments for diversifications and higher returns. In this curriculum, we define alternative investments and the characteristics they have in common.

Weight Given Across Levels

Level I

Level II

Level III

5–8

5–10

5–10

 

In this topic, we explain the fundamentals of portfolio and risk management, including return and risk measurement and portfolio planning and construction. We examine the needs of individual and institutional investors along with the range of available investment solutions. The capital asset pricing model is used to identify optimal risk in portfolios.

Weight Given Across Levels

Level I

Level II

Level III

5–8

10–15

35–40

 

Career Paths and Jobs for CFA® Charterholders

Is Pursuing a CFA® Charter Worth It?

  • Value to Employers

CFA charterholders are employed by JPMorgan Chase, Morgan Stanley Wealth Management, Royal Bank of Canada, BofA Securities, UBS Group, HSBC Holdings, Wells Fargo and Company, PricewaterhouseCoopers, BlackRock, and TD Bank Financial Group. Some employers even require it.

  • Content that Evolves with the Industry

Fintech and other trends in the future of finance will have significant impact on investments firms, career paths, and compensation trends. CFA Institute is poised to lead with our respected thought leadership, dedicated practice analysis, and close ties to the industry.

Hope you can find this article helpful. If you did like this Blog then Share it with your friends who are preparing for CFA Exams or who will be giving their CFA Exams in the near future.

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