CFA® vs Actuary level of difficulty
What is the CFA® and Actuary Exam?
The CFA® (chartered financial analyst) exam is designed to test the competence and integrity of financial analysts. This is a 3 level exam, with the first level testing basic knowledge and comprehensions questions on investments, the second emphasizing complex analysis and valuations, and finally the third level requiring synthesis of all conceptions and analytical methods for applications in effective portfolio management/wealth planning.
The Actuary exam on the other hand, tests a wider variety of in-depth knowledge. These tests include: a probability exam, financial mathematics exam, models for financial economics exam, SAO models of life contingencies exam, statistics and probability exam, and construction/evaluation of actuarial model exam.
CFA® Exam Vs Actuary Exam
As to which exam is more difficult, @saxxyman" provides an in-depth firsthand experience about both:
Having taken some of both, personally I would say actuarial exams were harder. The actuarial exams test for depth whereas the CFA® exam tests for breadth. In addition, actuarial exams are much more heavily mathematical as in you need to learn probability distributions, probability theory, calculus, etc. so if you're not coming from a strong quantitative/math background, it's not something you just simply study for a few hours and pass...
Ultimately it depends on what you want to do in your career, as the career paths are quite divergent for the two exam series.
If you have any more comments regarding your experience in CFA® vs actuary exams please comment below!
Actuarial exams are probably a little tougher, especially if you don't have at least some of the coursework behind them. But if you are working as an actuary most companies give you study hours (work credit for hours spent studying on your own) where I doubt if any firms are giving people study hours for CFA.
There is definitely overlap but these tests lead to fairly different career paths so the decision of which exams to take should be based on that and not on which exams are more difficult. I would not base the career path decision on the difficulty of exams.
At my company at least it is possible, though difficult, to move up in the actuarial department without any exams. If you can do the work, if people like you, they will find a spot for you even if you don't have the letters after your name.
Having taken some of both, personally I would say actuarial exams were harder. The actuarial exams test for depth whereas the CFA exam tests for breadth. For example, in the MFE actuarial exam, they test you on options, but you have to memorize the actual Black Scholes formula, calculate the entire binomial tree and then price the option and the payoff. CFA, on the other hand, would give you all those numbers and just have you price the payoff, as an example. In addition, actuarial exams are much more heavily mathematical as in you need to learn probability distributions, probability theory, calculus, etc. so if you're not coming from a strong quantitative/math background, it's not something you just simply study for a few hours and pass.
And on top of that, you have 5 exams + modules for the associate credential (ASA) and then 2-4 exams + modules for the fellow credential (FSA), so in terms of career time commitment, it is generally longer though the tests are offered more frequently but many of my old colleagues failed exams a few times and the modules can take 6+ months. You can look up how long it takes the average actuary to become fully credentialed, but I think it's 7 years of test prep...
If you talk to actuaries, the CFA stands for 'certified failed actuary' =p but both exams require you to be serious and put time into them, and are doable if you are diligent. It just gets tougher when have to work long hours.
Ultimately it depends on what you want to do in your career, as the career paths are quite divergent for the two exam series. Quite frankly nobody's going to care which exam series is harder - they want to know how serious you are about the particular career path and what relevant things you've done to get there. If you're looking to have prestigious letters next to your name, you're better off getting a PhD, not either of these exams.
Wow the actuaries sound so intense... Good news is CFA and actuaries are only about 5% of the cost of a PhD program. You also dont have to quit your job and lose that income as well..
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You have to be FINRA sponsored (by a member firm) to take series exams. Simply put - employer sponsored.
CFA gives breadth, not skill. you will not be a better picker than what you were at the beginning. yes some accounting stuff may be useful if you do some deep value and distressed stuff but in general everything is just an inch deep.
5.
CFA at 42 want to be an actuary? (Originally Posted: 09/12/2014)
I am currently a VP level Quant analyst at a bank. I have a CFA. But I have never been taken too seriously by bank or funds. I am thinking about passing actuary exam. I only have 4 to take with my CFA. But I do not want to commit career suicide or become an entry level actuary. I want to leverage my background. So my question:
Thanks a lot.
without a sponsor
i dont think any company would hire you for entry level jobs if you are 42. for experienced hired, it depends on what you have done at the bank. if you did lots of risk modelling, you may have a chance. some famous actuaries are head of risk management for major financial firms. i know entry level actuaries got paid while taking exams. their raise is directly linked with how many exams passed.
I guess I do not want to take entry level job then. With CFA and bank risk modelling experience (about 4 years) under belt, will I be able to land a more senior level actuary position? Or will I have a shot if I pass all the exams? Will I overqualify that way?
i do think you have a shot at a senior level position. but i am not sure if it will be an easy transition. last few actuarial exams are pretty hard. idk if it is worth efforts though. also idt you will be paid better than your current position either. if you dont like ur current bank, switch to a differnt bank. it is an easier path than the one you proposed.
Senior actuary gets paid 200k+. Definitely more than what I am getting. Besides, I feel jobs at banks are insecure. Attritions rates are high, they have the younger the better attitude. While in insurance, it seems actuary with more experience is better. It is a job that ages well.
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