Top 10 Rankings: Useful Designations
Morning monkeys,
Like many of you on WSO, I'm studying for yet another CFA exam (level 2, yay?) and as I'm shaking off the cobwebs in my brain I find myself wondering: is this the best designation? The answer is simple: no. But that's simply because there is no "best" designation, but there are "useful" designations which is what this list will hope to capture. That being said, is the CFA charter a particularly useful designation? Yes and no. It's well regarded in many areas of finance and business, but that's about it. There are many aspects of a designation that need to be considered when determining how useful it is, for example: Can it get me a job? Can it get me promoted? Can official documents be signed by someone without said designation? Getting your CFA charter will probably help with the first, almost certainly with the second, but not with the third. These are always things to consider when pursuing a designation.
Now, some ground rules, we'll limit ourselves to the job functions on WSO. Sorry JD & MD, you won't be considered. However, graduate level degree programs will, but only in the broadest sense (i.e. only "MBA" will be considered, which means both "University of Phoenix MBA" and "Wharton MBA" are in that category). Naturally, everyone's rankings will vary depending on their background and career preferences, so feel free to list your own!
On to the ranking!
10) Ph.D. - Sorry doctorate, but since my own set of rules require ambiguity within a degree program, the rather useful mathematics sub disciplines are getting lopped in with the psychologists. That being said, if you're getting a Ph.D. in economics, finance, applied mathematics, pure mathematics, physics, statistics, or really anything technical, you can probably lever that into a good job. If you're really set on that Ph.D. in medieval literature, apply for SNAP now.
9) CFP - Some may balk at the inclusion of the Certified Financial Planner designation in this list, but it's use shouldn't be discounted too quickly. Will it get you that coveted FO IBD role you've always dreamed about? Probably not, but someone has to sell financial products on the retail side, and those people oftentimes have CFP designations, making it not entirely useless for getting into finance.
8) CIIA - The Certified International Investment Analyst may be less known to many on WSO, but it is sometimes described as the European version of the CFA charter. To many of you, this may seem ridiculous since the CFA charter is a global designation, and you'd be right. The CIIA will always be in the CFA charter's shadow, which is what holds it back in the rear of the top 10.
7) CAIA - The Chartered Alternative Investments Analyst should probably be higher, but due to it's fairly limited scope, it's usefulness is not terribly high. Over time, especially with some of the effects of Dodd-Frank pushing insurers and banks into alternative assets in search of yield, it's poised to become more useful in the future.
6) FRM - In my opinion, the Financial Risk Manager is a real up and coming designation. I'm beginning to see this more and more on job postings alongside the MBA and the CFA charter. Good company to hold for any designation. The FRM still has to go through some growing pains, as it's only been around since 1997, but it's looking to be a promising designation going forward.
5) MFin - The MFin is a regular favorite among many here on WSO, but the reason it's not ranked higher is due to its limited value on the job market. Its usefulness appears to be limited to correcting a bad undergrad GPA, in order to enter into more competitive programs, namely target MBAs. Beyond that, it's utility seems limited, which is why it's ranked #5 as opposed to #4 or #3. Many will disagree with me here.
4) ASA/FSA - Some will question this ranking, but I've included the two actuarial designations that qualify for membership in the academy for one particular reason: legal protection. The only people who can sign actuarial memoranda, among other official documents in the insurance industry must be members of the American Academy of Actuaries. Having legal protection for your designation is incredibly useful for job security, as well as for getting a job. While the actuarial world is moderately shrinking, particularly within life and pensions, health is on the increase, and the SOA has recently expanded their program to include quantitative finance and enterprise risk management. Both very useful to the world of finance.
3) MBA - The MBA is the single most useful degree for finance. If we limited this to "Target MBAs" it would be ranked higher, possibly #1. But, since we're attempting to be as general as possible, the MBA suffers because of its commoditization over the past few decades. The real value with an MBA comes from the vast networking opportunity the degree program offers, which suggests that online MBAs and University of Phoenix MBAs are completely useless, as you can't benefit from this inherent value. This is the only reason that the MBA is ranked where it is and not higher.
2) CFA - I'm probably being something of a homer here, as the reality is that a target MBA will get you into a Wall St. firm much faster than the CFA charter will. However, the CFA charter is highly regarded and while it may not get you into the Wall St. firm of your choice, it'll set your resume apart from your competition. But, it's not a golden ticket by any stretch of the imagination. From what I understand, the CFA charter's usefulness is found with those who are already on Wall St. It's value is well understood and will probably help you get promoted depending on your job function. Additionally, for those trying to transition into finance, it's rigorous program will give you the academic background that is absolutely required for many positions.
1) CPA - Okay, don't laugh, but the CPA absolutely deserves to be in the #1 slot. Sure, accounting is boring, and yeah, some CPAs are a little weird, but there's tremendous value with this designation. The CPA is legally protected up the wazoo, the number of documents that have to be signed by a CPA are legion. Additionally, the number of financial firms that employ or contract a CPA is pretty damn close to 100%. Getting it isn't easy either, you need 150 hours of study or a master's degree (unless you're in California who has a different rule) and then there's a bunch of tests that must be completed in a set time frame. Will you enjoy the work as a CPA? Maybe not, but that doesn't take away from it's usefulness. The world will always require CPAs and having the designation will provide both job security and a leg up on the competition.
What do you monkey's think? What are your top 10?
Comments
I don't like your criteria.
I don't like your criteria. The question shouldn't just be whether it can get you a job, but how good that job will be along with its long-term potential. The CPA is so useless in the long-term that many (even accounting professionals) stop paying their dues and allow it to lapse.
And a JD should be considered as law is very relevant to investments. Lloyd Blankfein, for example, has a JD.
CFA > CPA
CFA > CPA
mike, I know this list is
mike, I know this list is your personal opinion and I see you've stated that "target MBAs" are pretty damn useful. You have some insightful explanations in regards to the placement of these degree in your rankings and you're absolutely correct in saying that the world will always require CPAs.
Having said that, I would rather take a top-25 MBA over a CPA because 1) I hate accounting, 2) I never want to work in accounting, and 3) I hate accounting. Sure, accounting is the "language of finance," but as a finance major, I can't stand it for some reason. I'm assuming that the majority of people who post on this website would rank an MBA/CFA/MSF higher than a CPA.
Side-note: Even though I'd never get an online MBA, you'd be surprised what an online MBA can do. A guy who works in my Mom's lab (a respected clinical lab) earned an online MBA, worked hard, and got promoted to a supervisor position. He now makes close to $80k before bonus/OT. I don't expect him to get promoted to CFO anytime soon, but that's not bad for an online MBA.
Great list. Just one thing
Great list. Just one thing about the CPA. It's very useful IF accounting is what you want to do. Completely agree with the job security part. Accountants will always be needed and until the field gets infected by the prestige bug- anyone can do it. That being said, considering this is WallStreetOasis.com and not Big4Oasis.com, I question it's spot at #1. As I'm sure you know as a CFA candidate, that program more than covers the accounting you need to know from a finance perspective in FRA. Just my $.02
Could you comment more on the
Could you comment more on the relative value of CPA for someone who wants to work in finance but not as an accountant. Say one has completed the accounting hours and has the opportunity to sit the CPA in his state, would that be worth much in an IBD environment or a fund (mf, pe, or hf) environment? Perhaps compared to the CFA, which you have at #2.
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FrankD'anconia: Great list.
Great list. Just one thing about the CPA. It's very useful IF accounting is what you want to do. Completely agree with the job security part. Accountants will always be needed and until the field gets infected by the prestige bug- anyone can do it. That being said, considering this is WallStreetOasis .com and not Big4Oasis .com, I question it's spot at #1. As I'm sure you know as a CFA candidate, that program more than covers the accounting you need to know from a finance perspective in FRA. Just my $.02
Agree with this. Kind of S&T specific, but the Chartered Market Technician (CMT) exam is up and coming and is actually useful if you are looking at markets. Even if it doesn't help you get a job it adds a different way of looking at things and might even help your PA.
wallstreet_sniper: CFA >
CFA > CPA
Just because this is a Finance dominated forum doesn't make this statement true. The CPA is more widely known than the CFA and can be seen as a value added designation across a broader number of functions/industries/companies/etc.
Asset Management is the only place that the CFA is commonplace and is borderline required... Even browsing monster/indeed i see more preferred qualifications that say CPA than CFA... even for finance jobs.
Not saying CPA is #1 just saying its fair to be ahead of the CFA
PoissonProcess: Could you
Could you comment more on the relative value of CPA for someone who wants to work in finance but not as an accountant. Say one has completed the accounting hours and has the opportunity to sit the CPA in his state, would that be worth much in an IBD environment or a fund (mf, pe, or hf) environment? Perhaps compared to the CFA, which you have at #2.
If you're interestd in working in IBD/PE/HF I would be surprised if the CPA offered much value. The only reason I ranked it #1 is because my scope is fairly broad, and with that in mind, it's tough to deny the incredible value that the CPA has built over the years. It's only downside is that you have to be an accountant :).
"My caddie's chauffeur informs me that a bank is a place where people put money that isn't properly invested."
This definitely depends on
This definitely depends on your personal background and personal goals even within the WSO-niche.
However, I agree that in a general sense this is somewhat accurate.
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I just wanted to add that the
I just wanted to add that the CFA designation is most useful when combined with networking. On its own, it's not going to do anything to get you a job. I know quite a few CFA holders in back office positions that lack the proper soft skills and network to get them where they want to go.
mikesswimn: PoissonProcess:
Could you comment more on the relative value of CPA for someone who wants to work in finance but not as an accountant. Say one has completed the accounting hours and has the opportunity to sit the CPA in his state, would that be worth much in an IBD environment or a fund (mf, pe, or hf) environment? Perhaps compared to the CFA, which you have at #2.
If you're interestd in working in IBD/PE/HF I would be surprised if the CPA offered much value. The only reason I ranked it #1 is because my scope is fairly broad, and with that in mind, it's tough to deny the incredible value that the CPA has built over the years. It's only downside is that you have to be an accountant :).
I would agree... Though it does add SOME value.. just not much.. I have been told that "it wont get you the job or be a differentiator, but it also isn't a harmful or a bad thing".. I am slightly biased as I am taking the CPA and at this point opted out of doing the CFA
I also agree that it adds the MOST value as an auditor/accountant
calikid3820: wallstreet_sni
CFA > CPA
Just because this is a Finance dominated forum doesn't make this statement true. The CPA is more widely known than the CFA and can be seen as a value added designation across a broader number of functions/industries/companies/etc.
Asset Management is the only place that the CFA is commonplace and is borderline required... Even browsing monster/indeed i see more preferred qualifications that say CPA than CFA... even for finance jobs.
Not saying CPA is #1 just saying its fair to be ahead of the CFA
Not necessarily. Although a CPA license might get you into a position in a wider number of industries, your function in those industries (if hired for your CPA) is going to be as narrow or even more narrow than functions where the CFA adds value.
You have to look at the overall supply and demand of the respective industries. A lot more jobs list CPA, but there are also about 6 times as many CPAs as CFA Charterholders in the US. The fact that both designations enjoy similarly low unemployment rates suggests that the demand for CPAs does not outstrip supply any more than it does for CFAs (and since the latter are better paid, the opposite may be true).
The OP addressed "usefulness". I suppose the CPA is more useful as far as mobility goes. But the CFA goes further as far as the quality of jobs available.
Ask anyone who has taken the
Ask anyone who has taken the CPA exam before, it's not difficult at all and it barely teaches you anything you haven't already learned in school. On top of that they also throw in stuff about government accounting and "economics" and "technology" that are all covered at such a high level you forget it all as soon as you step outside the testing center.
All in all the CPA is more of a mechanism to filter people out who aren't necessarily good test takers. Much more is learned on the job than through a test, but that's well known and has been discussed ad nasuem.
[quote=inkybinky] calikid38
[quote=inkybinky]
Not necessarily. Although a CPA license might get you into a position in a wider number of industries, your function in those industries (if hired for your CPA) is going to be as narrow or even more narrow than functions where the CFA adds value.
You have to look at the overall supply and demand of the respective industries. A lot more jobs list CPA, but there are also about 6 times as many CPAs as CFA Charterholders in the US. The fact that both designations enjoy similarly low unemployment rates suggests that the demand for CPAs does not outstrip supply any more than it does for CFAs (and since the latter are better paid, the opposite may be true).
The OP addressed "usefulness". I suppose the CPA is more useful as far as mobility goes. But the CFA goes further as far as the quality of jobs available.
The "quality" of the jobs though is completely subjective dependent upon a persons interest, and also don't forget there are more CEOs and CFOs who started as Big 4 Auditors with CPAs then there are CEOs or CFOs with CFAs from AM/HF/etc.
But back to the essential point of the post... Yes the CPA is more useful than the CFA
Ask anyone who has taken the CPA exam before, it's not difficult at all and it barely teaches you anything you haven't already learned in school. On top of that they also throw in stuff about government accounting and "economics" and "technology" that are all covered at such a high level you forget it all as soon as you step outside the testing center.
All in all the CPA is more of a mechanism to filter people out who aren't necessarily good test takers. Much more is learned on the job than through a test, but that's well known and has been discussed ad nasuem.
Agreed.... I work in Finance and passed FAR and BEC in the fall
Dude, MFin below that
Dude, MFin below that actuarial bullshit?! Tell that to the guys from the MIT and Princeton programs.
Don't see the CHP (Certified
[quote=calikid3820] inkybin
inkybinky: Not necessarily.
accountingbyday: inkybinky:
adapt or die: Dude, MFin
"My caddie's chauffeur informs me that a bank is a place where people put money that isn't properly invested."
mikesswimn: adapt or
mikesswimn: adapt or
adapt or
"My caddie's chauffeur informs me that a bank is a place where people put money that isn't properly invested."
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Wasserstag526: inkybinky:
inkybinky: Wasserstag526:
I've got a CFA and MBA, but
Triple Ph.D
My supervisor at the
I was wondering where you'd
I'm of the opinion that CFA
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It's nice to see the CFP
great post. the rankings of
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missing: I was wondering
"My caddie's chauffeur informs me that a bank is a place where people put money that isn't properly invested."
D M: mikesswimn: What do
"My caddie's chauffeur informs me that a bank is a place where people put money that isn't properly invested."
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"My caddie's chauffeur informs me that a bank is a place where people put money that isn't properly invested."
D M: mikesswimn: What do
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