A financial analyst researches macroeconomic and microeconomic conditions along with company fundamentals to make recommendations based on its business, sector and industry. They also often recommend a course of action, such as to buy or sell a company's stock based upon its overall current and predicted strength. An analyst must be aware of current developments in the sector in which he or she specializes as well as in preparing financial models to predict future economic conditions for any number of variables.
The CFA stands for Chartered Financial Analyst. The CFA designation is given to investment professionals who have successfully completed the requirements set by the globally recognized CFA Institute (formerly the Association for Investment Management and Research, or AIMR). CFA Institute continues to offer the CFA Program for the past six decades. The exam started in 1963 in USA and has become globally recognized with 130 local member societies spanning across several countries. By now more than 90,000 investment professionals hold the CFA charter. The CFA program leads the investment profession globally by setting the highest standards in ethics, education and professional excellence.
• The CFA program focuses on investment knowledge. This helps the candidate to build a focused career in the investment domain either in research or in portfolio management.
• As the program is done in a self study mode, candidates can focus on working full time while they progress through each level to earn the CFA charter.
• The program is well-structured to move from a basic entry level to an advanced expert level. Hence it becomes easy for candidates from other disciplines to start in this program and make a switch to the investment profession from other disciplines while doing the CFA program
• The CFA program has a six-decade history of maintaining a rigorous focus on globally relevant investment knowledge. This has created a good reputation for the program in the investment industry, amongst potential employers. It hence increases employability of all CFA charter holders significantly.
• The curriculum focuses on the practical knowledge and current real-world skills necessary in the global investment management profession. These skills are immediately useful on the job.
• Earning the CFA charter places the candidate in the company of more than 90,000 respected investment professionals. Access to their collective expertise, networks, and resources is an invaluable asset.
CFA charter-holders are sought-after by almost all financial institutions. The list below gives a break-up of where the CFA charter holders are employed:
• Broker-Dealer/Investment Banks – 16%
• Private Client Wealth Manager/Advisor – 11%
• Banks – 7%
• Hedge Funds/Funds of Hedge Funds – 6%
• Insurance Companies – 4%
• Pensions and Foundations – 2%
• Other (Consultancy, Government/Regulators, Academia, Other) – 29%
To acquire the CFA charter, candidates must meet the following three criteria:
• Pass the three exams set by the CFA Institute
• Have 4 years of “acceptable professional work experience”. This should necessarily be from the finance domain.
• Join the CFA institute by committing to the CFA Institute’s Code of Ethics and Standards of Professional Conduct.
To be eligible to enter the CFA Program, you must:
• Hold a U.S. bachelor’s (or equivalent) degree,
- or be in the final year of your bachelor’s degree program
- or have four years of qualified, professional work experience
- or a combination of work and college experience that totals at least four years
• Meet the professional conduct admission criteria (during the application process, you will be asked to sign statements of Professional Conduct and Candidate Responsibility)
• Be prepared to take the exams in English
• Have a valid international travel passport (required for enrolment and exam registration)
Graduates from any discipline are allowed to take the test. Four years of work experience is a mandatory requirement for getting the charter and not for appearing for the exams. i.e. without work experience a candidate can take the exams.
The CFA program is split-up into 3 levels
• Level I – Builds the knowledge and comprehension of fundamental investment tools and concepts. It essentially defines: “What is a good investment?”
• Level II – Builds application and analysis focused on asset valuation. Hence it allows comparison between two assets i.e. it answers “Which is better, investment A or B?”
• Level III – Synthesis and evaluation of client needs and portfolio management issues. The emphasis is now on portfolio construction and portfolio comparison i.e. “Which is better, portfolio A or B?”
Exam pattern for all the three exams is different.
• Level – 1: Comprises 2 papers, with 120 multiple choice questions in each paper.
• Level – 2: Comprises 2 papers, with 60 item set questions to be solved in each paper. The time for each paper is 3 hours. An item set question consists of a caselet on which 6 multiple choice questions are asked.
• Level – 3: Comprises of 2 papers. The first paper consists of questions to which the candidate has to provide a constructed response (i.e. write an essay type answer). Candidate gets 3 hours to answer this paper. The second paper comprises 60 item set questions, to be done in 3 hours.
There is no negative marking in the CFA exam. The exam happens in a morning session, timings 9.00 AM to 12.00 AM and afternoon session, timings 2.00 PM to 5.00 PM.
• Level 1 exam happen twice in a year. On the first Sunday of June and December.
• Level 2 and 3 exams are held once in the year, on the first Sunday of June across the globe.
In India the June 2015 exam will be conducted in 7 cities: Ahmedabad, Bangalore, Chennai, Kolkata, Mumbai, New Delhi, Pune.
Candidates who clear CFA exam (any level) are intimated about their results via an email. The email mentions the candidate result as a “Pass” or a “Fail”. A relative score of the candidate for each subject (in all 10 subjects), in each of the 3 result zones is shown, i.e.,
• Score < 50%
• Score Between 50% and 70%
• Score > 70%
If the candidate is not able to clear the exam, then he is given information of the band in which his performance was. The band is from 1 to 10, with 1 showing least score and 10 showing the highest score, i.e. the difference between the candidate who has cleared and the candidate who has not cleared with a Band 10 is very low.
Following are the pass percentage of the previous CFA exams
June 2014 Exam Pass Rates
1. Level I: 42%
2. Level II: 46%
3. Level III: 54%
December 2013 Exam Pass Rate: Level I: 43%
Candidate pays once for the enrollment and regular exam registration fees for each exam. Following are the fees for the June 2015 exam:
• Program Enrollment Fees = $ 450
• Exam Registration Fees = $ 825
• Total Fees = $ 1275 (Approximately Rs. 76,500 (60 Rs./$ as exchange rate))
For the above fees, as a candidate you get to write the June 2015, CFA Level – 1 exam and you are also given 6 curriculum books (fees included in exam registration fees), to study for the exam. These books reach your place within 8 working days of enrollment with the CFA Institute.
As a candidate you can enroll for an exam any time. So once you have decided when to appear for the exam, you can register with the institute for that exam date
To get started with the CFA program, you need to register with the CFA Institute. Also, you can get in touch with Proschool for any other queries, related to the CFA program. Proschool has both classroom and online classes to enable you for a CFA® career. The course is designed to help you, understand and make business decisions related to the investment industry. Proschool will be training you for Level I of CFA® exam. This course is simple to understand with relevant industry examples and case studies with interactive explanations to help you succeed. Our study material and practical training is based on the CFA® curriculum. You can opt for a weekend, weekday or an online course module.
The focus area of CA is Auditing, Accountancy, and Taxation whereas
the focus area of CFA® is Investment Banking, Equity Research, Investment
Advisory Services, Portfolio Management, Wealth Management, etc.
is statutory qualification in India whereas CFA® 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® only after graduation.
CFA® passing rate is between 40% and 50% whereas the passing rate for CA is typically less than 10%
The CFA program is investment oriented. Doing CFA means getting into
Investment Banking, Mutual Funds, Derivatives, Portfolio Management,
Equity / Debt Research, Financial Services, Fund Management for large
institutional investors, Banking Industry etc. It has more emphasis on
the analysis and research side as compared to accounting.
contrast, CIMA is an 'accounting qualification' for those working
outside public accounting (i.e. audit) It is more about accounting and
related issues within finance departments and companies.
about financial analysis. It less oriented towards the technicality of
accounting, and focuses more on its financial interpretation.
is more quantitative with respect to the treatment of its topic than
CIMA is. CFA® will touch upon derivatives with some depth for instance,
whereas CIMA mainly focuses on their accounting significance.
Both the qualifications are recognised across the world. The focus of
the CFP curriculum is to make financial plans for an individual whereas
the focus of the CFA curriculum is to plan investments for corporate,
portfolios and/or institutional investors.
CFA charter holders
work in financial areas that deal with institutional investments where
as CFP charter holder is 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: CFA is oriented towards financial research and analysis whereas the CFP looks at investment planning for individuals.
Duration: CFA® takes at least 2 years to complete, while the CFP can be completed within a year.
the CFA 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,
You can start pursuing the CFP after the 12th while you can sit for the
CFA level 1 only after graduation or during the final year of your
Expenditure: Total expenditure of the CFP along with
tuition fee is INR 50,000 to INR60000, CFA expenditure is between INR2
lakh to INR 2.2lakh.
Commitment: Compared to CFP, the CFA exam is tough and requires more time commitment.
Average salary just after completing the CFP is in the range of INR 2
lakh to INR 4 lakh on the other hand after CFA it is in the range of INR
3 lakh to INR 5 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. There is also a
work experience requirement. Check this website for more details.
Work Experience: In both CFP &
CFA®, you need to meet certain education and work experience
requirements. You need to have 4 years of relevant work experience for
the CFA® and 3 years of relevant work experience for the CFP
While CFA® gives strong theoretical knowledge about Investments, and how
investment decisions are made, Financial Modeling is all about the
practical aspects that culminate in investment decisions. Financial
Analysts work with Excel sheets and use their extensive knowledge to
forecast valuations for companies, markets, industries, etc.
Without an MBA degree from a reputed B School, it is tough for engineers
to get into finance, but with the CFA®, it is possible because the CFA®
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®.
engineering background gives him/her quantitative problem solving skills.
Along with this if she/he has a CFA® she/he is a perfect match for the
investment industry. A typical job offered to an engineer with a CFA charter is sales or a trading job.
If you're good at numbers and
have an interest in finance, you should do the CFA®. Financial
engineering/quantitative finance is a field where they like to hire engineers.
1. CFA® is cheaper compared to an MBA, it costs about US$3000 (Rs 2
lac to 2.2 lac) for the three levels, an MBA costs around 5 lacs and
2. You do not have to take time off to do the CFA program; it is a self-study program, where as the MBA is a fulltime program
With an MBA it is more about the Management and it covers broader
subjects ranging from HR, Marketing, Finance, Operations, Strategy,
International Business, e - commerce etc.
4. The CFA program
provides charter holders with specialized skills, such as Investment
Analysis, Portfolio Strategy and Asset Allocation. The MBA program
covers many things by just scratching the surface, while the CFA program
covers one thing with a lot of depth.
The CFA charter is respected as a standard of professional credentials
within the global investment community. CFA is an internationally
recognized designation. The exam started in 1963 in USA and has become
globally recognized in 176 countries. The CFA program leads the
investment profession globally by setting the highest standards in
ethics, education and professional excellence.
Financial Analysts work for investment banks, mutual fund firms, hedge
funds, brokerage houses, boutique money managers, etc.
across the globe know the value of the CFA charter and recognize the
CFA® charter as the standard of professional excellence. Therefore, CFA®
gives you the edge and the advantage in the global employment market.
If you're interested in portfolio management, investment research,
advisory services, or investment banking, then CFA® is an option that
you must consider.
CFA® teaches you about valuations, investment banking etc. In Financial Modeling, you will learn how to use your conceptual understanding in the practical world of finance where you prepare financial models of a company to know its valuation.
CFA® is a well-renowned international qualification in the field of Investments. CFA® is an indispensable qualification for professionals who are looking for a long-term career in Investments. CFA® 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® 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®, because it will help them prepare the foundation for CFA® at the same time it can help them get a job in Equity Research, Financial KPOs, etc.