Should I study for the CFA®?

I feel like the general opinion is that the CFA is more of a "get the foot in the door" than "rise through the ranks" typa thing. If you're doing your MSF most of the shit won't be new either. You'll also probably get a lot of ppl explaining how what it teaches isn't exactly applicable to on the job, etc.

Anyway, taking into account your personal position (trying to move from Ops to ER) and the fact that you're doing your MSF, I feel like it might be a good time because not only will the two complement each other in terms of material, but it can else give you that "foot in the door" boost. Just my $.02

Networking + Making Sample Work + Keeping Your Day Job > CFA You can sit for the test once you started working.

If your end goal is equity research then I would definitely pursue the CFA. Your competition will almost assuredly be at some stage of the CFA. As above poster said, it will definitely help get your foot in the door and it shows that you have an elevated amount of interest in the field.

My advice: You should definitely take L1 at the bare minimum.

It helps on the sell side

On the buy side, you generally need one of three things:

1) CFA

2) Brand name degree

3) Ability to make money

If you only have 1 or 2, that might be enough to get your foot in the door and learn how to succeed with 3. If you already have 3, you don't need anything else, though that would be rare without direct experience.

Thanks for all the input!! Sounds like I should shoot for taking L1 this December. Anyone have a good estimate for the number of hours of studying to expect for good performance? I'm trying to judge if I can perform in my job, complete my coursework and study with the expectation of passing. I'd hate to throw away a few grad I could have spent elsewhere. Or if there are any suggestions for extra materials, Stalla, Kaplan?

^^Stalla no longer exists. They got bought out by Schweser (Kaplan).

The pass rates are in the 30's. Compare that to the bar which is in the 80's. You should approach the test with this in mind, are you in the top third in school? At your job? Among your peers? It tends to be a good predictor of success.

Not really comparable to the bar though. You study for the bar for three years in law school (I'm shocked it's only 80% -- what were the other 20% retards doing?). I agree the test is hard, but I don't think you can compare it directly to the bar. CFA is probably the hardest professional test around except for the actuarial tests.

Level 1 pass rates are low because people don't know what they are getting into. Level 2 and 3 are the real deal though. By the time you get to 3, there is no dead wood left, and most years the failure rate is still 50% or higher.

CFA is not worth it when you can alternatively take a 2 year vacation and get an MBA.

Thanks for the advice BillyRay, I've been working on networking with some junior level people in ER at my firm. Hopefully I can gain more contacts within the next year as I finish my degree.

The end goal is an internal transfer. I recently applied and was selected to interview for a role in ER but wasn't allowed to continue since I've only been at the firm roughly 1 year. Yet another hurdle, but I'll find a way to make it work.

Whatever level of Schweser you get, make sure you get the Q-Bank.

I've been studying since mid-January, have done all the Q-Bank questions, all the Schweser Notes practice questions, all the CFA material questions and 3 practice exams and I'm scoring mid 70% on the practice exams, just to give you an idea of how much material there is to cover.

My friends who have done MSFs have breezed through CFA level 1 with minimal study (less than a month of light review spread out and a week or two of heavy heavy review right before the exam). I would say your time expenditure for level 1 will be minimal if you have paid attention in class at all.

I have CFA level 1 under my belt. I can't speak to how it affects one's job search because I'm not looking to switch right now. Took it just for fun. A few weeks of Schweser and you should be good to go.

I will say that people who have passed CFA will give props for passing level 1, and mad props for passing levels 2 and 3.

I'm taking level 2 this weekend and it's the one time in my life where I think there is a non-negible probably that I fail an exam. Definitely should have started studying earlier. I got overconfident because of the positive experience I had with level 1.

My friends who have done MSFs have breezed through CFA level 1 with minimal study (less than a month of light review spread out and a week or two of heavy heavy review right before the exam). I would say your time expenditure for level 1 will be minimal if you have paid attention in class at all.

Thats reassuring, glad to know I might be 'killing two birds with one stone'

Good luck with level 2 hopefully it works out!

I finished my sophomore year of college. I am considering taking CFA I this December.

Can you guys please tell me how much it is going to take me to pass L1. The total costs including books, registration, exams fees, and any other relevant cost. Cost might be a significant barrier for me.

And where can I find the syllabus? I just want to take a look at the L1 curriculum before I spend money to register for it.

$1400. While you are in college you can get a professor with his CFA designation to sponsor you and it brings the cost down signficantly (a few hundred bucks total cost I believe...don't remember exactly).

...so get sponsored if you are a full time student.

OP, In my senior year of undergrad (business, finance concentration) I took CFA 1...studied for 1 month probably 150 hours total. It felt like a culmination of all my business classes....all the finals put into one big test. CFA recommends 200-300 hours and many people follow that.

This was just my experience....the topics were fresh in my mind (I'm also good a remembering formulas) and I was able to put in 40 hours a week studying....so take that into consideration. Past performance does not guarantee future returns.

L2 in two days...;(..can't wait for the first beer sat evening....and then the following 14.

Re the importance of it, it didn't help me get any interviews, helped at times in the interviews (but you have to play it right...people not in the program will be very skeptical and it can even hurt you if you act special for having it). It's starting to help me now in the office as I am taking L2 and some senior people and other analysts give me a "wow, this guy is serious" look when I tell them. (a lot of people act like they like valuation and investments....but they really don't and don't know how to look at a company and figure out what the numbers actually mean/ develop a thesis). As I am looking for different opportunities outside my analyst program, cfa is helping (helping...by no means making things happen). I'm interested more in HF.....PE they wouldn't give a rats ass.

Are there any sort of fee waivers for FT college students? None of my professors have a CFA. Can I get someone with a CFA charter to sponsor me for a reduced price?

Level 1 isn't an absolute must but it will be VERY helpful as you're applying for and interviewing for research positions. ER takes it as a sign that you're committed to the investment research industry.

The MSF will allow you to greatly reduce the necessary study time. Usually people put in 3 to 4 months for the CFA but depending on the curriculum you won't need nearly that much. Depends on how heavy your curriculum is in things other than pure finance - specifically accounting/financial statement analysis, statistics, and economics. Accounting/FSA is the most important of those for Level 1, so you would need a couple weeks to really get at that if its not part of the MSF program.

As for December vs. January, if you really aren't too worried about schoolwork than definitely take December. But being finished in March would leave you plenty of time to relax a little then ease your way into studying for June. People in ER don't care which one you take, just depends on when you want to get started with the interview process.

I'm taking level one on Saturday, and currently hating my life, but I think in the end I will be happy that I at least tried. Seeing that you have a finance background, it should not be too difficult for you. I would at least try level one while the material is fresh on your mind, for a mere $1500 you would be stupid not to. I will also note that if you are planning on going into equity research, the entire level one curriculum more or less assumes that you already work in that arena, simply by the situational questions that are offered in review materials. I have a leg up on the FR&A, FI, and Econ sections because of my current job and my undergrad, however the other material is relatively new to me. With regards to level one "getting your foot in the door", I can honestly say it probably won't help you one bit if you already have real world experience, chances are you will be able to talk to any concepts that come up during an interview with your current role and your schoolwork. Passing all three levels will open up many doors, however. Bottom line, the longer you wait to do it, the harder it will be/more it will suck because the material will get pushed further back in your brain and once you start working you will have less time to study.

Yes, if you're in your senior year. Otherwise, it's a little too early.

Don't buy any books yet. They change them every year and now make you buy them when you register.

It can't hurt starting to learn the basics via free study guides (investopedia, analystnotes, etc)

Aren't the interviews for summer internships starting in the Fall? If not already?

Those are sincere questions btw.

Andy,

I realize this. But remember B-school students have a diff system for recruiting ... it begins in late October and goes through till December.

Any advice on the questions I asked?

R

cfa charter is not useful for the consulting and ib roles you are aiming for. if anything it will make you look like you don't know what you want to do.

Thanks for the quick feedback whatwhatwhat. Can you also answer the question considering the IB hiring climate and being not part of the traditional OCR for internships how I can stand out for the SA 2012 programs?

Tons of guys at my bschool wrote the CFA exam during 1st year. But part-time recruiting is so, so different from full-time, I'm wondering if you honestly have a shot at changing careers in this economy coming out of a part time program? Do MC / IB recruiters honestly consider part-time students? Do these part timers historically get internships, and does anybody in the class actually land in careers like consulting or IB? I'm honestly curious.

Tons of the guys who are starting up at my BB post-bschool have CFA1 on the resume now. Especially the career switchers as they use the CFA to prove deep interest / knowledge in accounting and finance. And you should be tailoring your resume for each company, so you can always take it off the resume for certain jobs.

If this is Chicago then you can network in the city, get an internship during the semester (much better than CFA) and take it from there.

Yes this is Chicago @ JMu. When you say network in the city to land internships? Are you talking about off-cycle internships? Send me a PM and we can discuss.

@ gamenumbers: Part time recruiting is diff than Full Time recruiting for internships. But people do make the switch to MC in part time program. IB is harder but there are a few cases of this also.

You did bring up an excellend point of CFA level 1 being taken by career switchers to show interest and deepend knowledge in the field. However, if I am concentrating in Finance at this school - do I need to prove anything additional?

I also realize for MC I don't need the CFA. So I guess my question is for BBs.

thanks guys. Anyone else in the forum knowledgeable to answer this? R

Yes, off cycle (unpaid) is your best bet. Even if you're a career changer, I think an off-cycle internship (or even networking) is much better than spending time studying for the CFA. You still have time and Booth has a sick alumni network in Chicago. Use that to land an IB/MC off-cycle and work your butt off. Even if you don't get a top bank summer internship, you'll have enough experience/contacts to shoot for BB/MBB for FT in '13. It's not doing to be easy but is definitely doable.

MBB=McKinsey, Bain, BGC. They are consulting firms. You likely won't get BB/MBB off cycle internships. You should target boutique IB/MC firms.

you wont get the cream of the crop opportunities from a part time program is what hes saying.

Check the profiles of seniors at your firm and then decide if its something useful to fast track your career. It's best to give it now as things are fresh from undergrad.

Not useful, not within IBD anyway. Progression is very structured unless you are a rockstar at your job. WIth regards to exits, it might help marginally, but PE shops are going to care more about what you've done instead of whether or not you have a CFA.

I could be wrong, but this is my understanding. I haven't really seen too many senior guys with CFAs. Who knows, maybe they have it but it isn't evident on their titles/business cards.

When I met with people from say, advisory practices at the Big4, they flaunted their CFA/CPA and whatever other licenses they had in all their titles and business cards. It seemed as though everyone was certified in some way shape or form.

Bankers I've met don't really seem to care...

To shift roles, the CFA is a good bet. Most banks will pay a proportion of the CFA fees, some only after you clear a level, but worthwhile asking.... I know a MD who shifted from accountancy to banking and highly recommends the CFA to aid any such transitions. BUT be warned, views on the CFA vary from bank to bank - some couldn;t give a toss, others will view it as a +ve. I guess what really matters is if any of the snr guys on ur team have done it. If yes, they'll typically want the juniors to do it....

If you have a charter and decent experience, you may become an associate without doing an MBA (which is cost- and time-efficient). But passing some of the levels, esp. level 1, doesn't mean anything at all (well, of course you gain knowledge, but I mean apart from that).

if for IB interviews (not for OP, but for others), your interviewer most likely won't care.

But, it's a good refresher for all your basic bus. courses + I thought it was a good way to even out the playing field against ivy kiddies as well.

I took L1 in Dec and passed. It's a tough test, and you can kiss goodbye to about a month of weekends leading up to it. It'll be time consuming, but assuming you graduate mid-May, that's not a huge deal. Just know what you're getting yourself into.

Also, I have to disagree with most of the people above who say that it isn't very relevant. I took it because I got a scholarship from a professor, and midway through was thinking "this is a bunch of crap...I'll never use this. I should just wing it." Then I started to get into the financial statement portion, and realized that had I known a lot of the concepts reviewed as in depth as I do now this past summer, I would have kicked a lot more ass as an SA. While all of the material isn't completely relevant, a lot of it is, and knowing it will make you significantly better as an analyst.

That being said, few bankers have the CFA and it's more of an inv. management credential. BUT that doesn't mean you shouldn't do it. If you want to go the HF route post analyst, it is a great signal. If you're not sure banking is for you, it keeps your door open to IM. Also, if you're a liberal arts student, its a great signal that you're serious about finance. I'd weigh all of this into consideration and, thinking about what you personally want to do in the future, make an educated decision.

Glad traders don't need this.

you might want to wait until you start your job. most major banks reimburse cfa fees.

Usually, your school or your regional chapter will offer you a scholarship if you're still a student when studying/taking for the CFA. That'd be my motivation for studying/taking it earlier rather than later, that fact that it would be free

ananalyst:

I know CFA doesn't help that much

I think that's a very uneducated thing to say. A charter commands a huge amount of respect on the buy side. You put those 3 letters after your name and it pretty much says 'I am a financial wizard'.... making it through the full 3 levels requires absolute mastery of the material.

It goes without saying that working your way to your CFA (and certainly, having your charter) will make you stand out on B-School applications. Applicants to the top-tier are a dime a dozen these days.

I would be interested to hear if any CFA's on this board are having difficulty finding employment in our current environment. I can venture a guess...

I was recently laid off from IB and trying to stay in the field right now is difficult. I had some opportunity to relocate and some smaller shop offers, but had no interest. I decided instead to go to the buyside. EVERYWHERE that I interviewed asked me about CFA. Even if I had had level 1 and been on my way to level 2 it would have helped tremendously. I ended up with a job on the buyside, and stressed in the interview process how interested I was in pursuing CFA.

Just want to give you a different perspective because while the CFA may not be the most helpful credential in banking, it may not be your choice whether or not banking is your career - and if/when you cross that road it is always nice to be more qualified for potential transitions.

def. do agree.

alumni have told me...

finish gmats by sr year since you're still in study mode

finish level 1 as soon as you graduate (still fresh in your head)

I would doubt such statements as "CFA doesn't help much" and the like. Being a CFA charterholder, I may assure you that senior people give you (and what you say) a certain amount of respect, and the knowledge you gain while studying is extremely helpful even at the sell-side. Besides, having completed the CFA program is actually one of the very few ways to progress without being required to get a top-tier MBA.