Quick question. Where did you first learn about the CFA course?
Was it in college canteens? On subreddit pages? Or did you read about it on group WhatsApp texts?
If you have said yes to any of the above, but are still not convinced how the CFA Charter would help your career coz reading and listening to a lot of stuff around has confused you?
There have been a few rumours about the CFA course that aren’t true. Yet, if enough people repeat it, it becomes the gospel truth.
It is time to get your facts straight. Clear your head. Forget all the information you heard through unofficial sources. The right places to find authentic details is the official website, certified coaching institutes and trained CFA professionals. You can also find the truth here. Below are the seven biggest myths surrounding the course. Lucky for you, we debunk them one by one. So you get only accurate facts and no fabrication.
#1 “I don’t have a finance background. I’m not eligible for CFA!”
Let’s say, you are an Arts student who is considering a shift into the financial stream. However, everyone has told you that it is too late. Students need a commerce or finance degree to apply. Are they correct? Not exactly. Yes, the CFA is a finance-heavy course. Yes, they prefer it if you have a solid foundation in commerce. Don’t despair if you do not have one. The CFA investment foundation program (CIFP) is an online program that helps students learn basic concepts and strengthen their knowledge. Once you clear this certificate, you are eligible to apply for the CFA.
#2 “I have heard that the CFA is more difficult than the CA program.”
There is no comparison between the two. CA is, without a doubt, the tougher course. The CA exams have been structured into groups, making the exam much harder to clear than the other professional courses. Many students find it hard to pass the exams.
Did you fail one paper by one mark? You flunk out the entire group and have to submit all the papers again. It is quite ruthless, to be honest.
The passing rate is about 6 percent for both groups. This means around 94 percent of the students do not clear the CA on the first attempt. This course is not for the faint-hearted. On the other hand, the passing percentages for all three — CFA Level 1, 2 and 3 — are between 45 and 55 percent.
Make no mistake. The CFA isn’t an ‘easy’ course. You must be adequately prepared and put in a high number of study hours to pass. Interestingly, the CFA levels become easier as you clear one round and move on to the next.
#3 “My MBA degree in finance is enough to join an investment firm.”
On the surface, the above statement is true. Dig a little deeper, and you’ll discover that there are certain conditions to consider. While most employers recognise the value of an MBA degree, they also understand the hierarchy of business schools in India. If you are not from the top-rated colleges, your MBA doesn’t command quite the same respect. Also, with corporations opening up offices the world, they require professionals with specific expertise and prowess. The CFA is a skill-based course. They teach you how to manage portfolios and analyse capital markets using quantitative methods. Consider it an added asset to your degree.
#4 “The CFA course is too expensive.”
The CFA program costs roughly 2.5 to 3 lakhs and takes around three years to complete. While this can sound steep to a lot of people, the truth is you are getting value for your money. The course is extremely intensive, it teaches valuable skills and fully prepares you to handle the investment industry. The money you put down for the course will come back to you when you get a high paying job based on your CFA certification. If you structure your time efficiently, you can work at a job and on your course side by side. This way, you can continue to earn while studying. Professional courses tend to be priced quite competitively, but you are getting bang for your buck.
#5 “I need additional work experience after completing the CFA.”
If you want to become a charter holder, you must fulfill the criteria — finish all three levels of the course and 4,000 hours or 36 months of work experience. However, your work experience requirement doesn’t only start the minute you clear your exams. If you have worked in a relevant position within the investment industry before completing your CFA course, that time does not go unnoticed. The CFA Institute recognizes the time you put in at an investment advisory firm or a financial company, as long as it connects to the subjects taught in the course.
#6 “The CFA is a male-dominated course.”
There was a time when there were only men in the investment industry. Good thing we are in the 21st century now. Things have changed. More and more women are entering this field. Worldwide, around 37 percent of all CFA charter holders are women. And that number is steadily rising. The CFA also offers a women’s scholarship every year for those who wish to pursue the course. So it is an absolute fallacy to say that there are no women in the CFA program. As long as you have an aptitude for finance and a mind for higher learning, the CFA certification is perfect for you.
#7 “I think I will apply for the FRM course instead. It is easier.”
Many students seem to think the FRM and the CFA are interchangeable. Wrong. Both courses are fairly dissimilar. The FRM is a specialized program that concentrates solely on risk management. It is for students who want to become financial risk managers. The CFA has a much wider scope as it delves deeper into the world of financial analysis and investment management. You cannot substitute one course for the other and expect similar opportunities. So choose well.
Why the CFA course will dominate the financial industry in 2022
- Global corporations and MNCs in India value the CFA qualification and tend to hire certified professionals
- Your job prospects significantly increase with CFA. You are qualified to apply for the role of an equity research analyst, financial advisor, portfolio manager and investment banker.
- Gain analytical skills like quantitative methods, financial reporting and portfolio management
- CFA charter holders have a strong network of professionals who can help each other
- Seven per cent of CFA charter holders have gone on to become chief executive officers
The bottom line
There you have it. We have busted some of the biggest myths surrounding the CFA course. The reality is that this is a highly prestigious financial analysts course, offering budding investment advisory professionals a complete education. The CFA will create fantastic opportunities for your career. It will put you in a higher salary bracket, make you eligible for leadership roles and help you create a niche for yourself in the industry. It is no wonder that MBAs and individuals with master’s degrees are keen to pursue this course.
Get more accurate information about the CFA here