cfa for consulting?
Hi there,
I am from electrical engineering @ university of toronto and i am doing an intern at some IT company right now. i am interested in getting a job in a consulting company but they always ask for a business/financial background which i dont hv. i am wondering if passing CFA level 1 will help me get an interview in a consulting company.
Does CFA Charter Help Consultants?
The CFA charter is a sought-after designation for many industries within finance. While it is perhaps most appropriate for asset management, thousands of individuals sign up every year in order to they’re capable of surviving a rigorous study period and famously low pass rates.
If you’re looking to break into consulting, however, the CFA is not needed. Some consultants may have earned the CFA designation, but this likely happened during an earlier finance-related part of their career.
If you really want to improve your finance knowledge, here are some other recommendations to consider:
- Network with alumni from your school who work in consulting and get their advice
- Spend the time preparing for case interviews
- Learn excel skills through a financial modeling course
- Add a finance-related minor if you’re still in school
- Read:
Michael Porter on Competitive Strategy
Recommended Reading
hmm, level 1 itself will give you the business knowledge, but cfa has nothing to do with consulting and theres no point in taking level 1 without 2 and 3.
so is there a better alternative than taking cfa then? say taking a minor?
Your time would be much better spent networking. Consulting companies hire a lot of engineers, mostly for IT consulting but also for other divisions. The CFA will take 200+ hours of your time and focuses on a lot of subjects not directly applicable to consulting. A minor is a better option but I know a lot of consultants who had little formal business education before the entered the field. They prepared well for case interviews, which are the only real business knowledge tests that comes up in recruiting for many firms. I would contact alumni from your school who worked in consulting and get their opinions.
The CFA is going to take 750+ hours to clear all three levels. There are CFAs in the consulting industry but they earned the designation earlier in their careers doing something investment related. The CFA is geared towards asset/portfolio management so it doesn't have much practical application in the consulting world.
Will it give you a leg up? Always.
Hi monkeys,
I have 8 months to kill before starting my MBB gig in August in a region where it sounds as though I'll be doing a lot of PE due diligence work.
CFA level one -- good use of my time? I studied Hirstory @ HPY and have never been in the field before. I haven't used excel since high school. I'm not sure what I want to do after my 2 - 3 year stint at MBB, but I do know I want to do something productive before starting.
Thanks for your input and perspective.
Perimmon.
.
Level III CFA candidate here.
You won't get any excel skills from the CFA program. You will develop a good deal of familiarity with accounting and some of the high-level technicals of valuation. For me, the bond & derivatives part was the most novel part (the majority of what you learn about equity valuation is common sense).
All told, the CFA program will not be of very much use while you're at MBB. As 2X2 said, the "PE due diligence" is not financial due diligence, they use bankers (or in house) for that.
Where the CFA can help you a great deal is if you're looking for a hedge fund (or maybe PE) job after 2 years, but I imagine that level I only won't give you much of a leg up.
Honestly I don't think the CFA program is right for you, given what you've said about your interests. If you're still interested, I'd suggest, ahem, acquiring the schweser notes and reading a few chapters & practice problems (don't start with ethics though), and see if you like it. If you don't find it fun I guarantee you won't finish.
If you're really looking for something to do to educate yourself before starting at MBB, I'd suggest reading: Porter's Competitive Strategy (dry, but very very good) Buffett's Letters to Shareholders (witty and very insightful) The Innovator's Dilemma.
These are all cliches, but they call them classics for a reason.
Silver Banana for the excellent personal advice given to me. Thanks a ton!
CFA in Management Consulting (Originally Posted: 09/15/2011)
Hey Guys, Currently got a job as a 1st year analyst at a big4 firm, and am trying to find non-MBA methods of enhancing my CV (5 years of B-School is enough for me). Is CFA respected in the consulting field? would it be enough to bump up to a top-tier firm, if coupled with some decent projects? I understand it has a pretty low pass rate (around 40%?) but i am assuming that is because people do it while working full time - has anyone completed it and have anything to say on the matter?
Post a decent response and you will be greatly rewarded!
Do you have any idea what the CFA tests? If not then you should look into it then realize it's not related to MC at all
as shorttheworld described... a CFA designation has nothing to do with and will do nothing for your potential career in MC... this is the CFA program described in a very shortten manner...
The Level I study program emphasizes tools and inputs, and includes an introduction to asset valuation, financial reporting and analysis, and portfolio management techniques.
The Level II study program emphasizes asset valuation, and includes applications of the tools and inputs (including economics, financial reporting and analysis, and quantitative methods) in asset valuation.
The Level III study program emphasizes portfolio management, and includes strategies for applying the tools, inputs, and asset valuation models in managing equity, fixed income, and derivative investments for individuals and institutions.
no MECE, no Decision mapping, no NPV, none of the stuff you need to get into MBB
WOW no NPV analysis in the CFA???? really?????
.
CFA is designated towards the Investment Management (Buyside) where you'll be a stock-picker more-or-less. Having a CFA for consulting is utterly useless, Although business school doesn't sound like the right way, it is a definitive way to jump into consulting.
Relevance of CFA in Consulting (Originally Posted: 08/27/2009)
Fellow Monkeys, After about 9 months in Commercial Banking, I'm about to begin my career in consulting, a full time role in KPMG Business Performance Services in Lagos, The commercial capital of my country, Nigeria. Im curious about two things however, Kindly clarify.
(1) Ive read on the CFA website that the CFA qualification is also useful in consulting firms...I was just really wondering; In what division of a consulting firm would the CFA be valuable...Im guessing its the Private Equity or corporate finance Practice but I just want to be sure...
(2) Im intereseted in one day working in the Private Equity Practice of a top consulting firm like McKinsey or Bain and Company and in the long run moving on to a Private Equity firm...To achieve this, I intend to pursue a top MBA in the U.S...Will the CFA also be a valid qualification given my ambitions?
By consulting, they mean "investment consulting." This is very different than the strategy or operations consulting practices of McKinsey/BCG.
Your KPMG role sounds like an operations one. That stuff will not qualify for the CFA.
CFA is not that important for PE. It is useless for strategy consulting with the brand name consulting firms
CFA for an MBB Management Consultant (Originally Posted: 04/08/2012)
Hi, I'm a 1st year associate at one of the MBBs (Europan office). I don't have an MBA (I transitioned directly from Analyst to Associate) and I have an engineering background.
I've been trying to land a job in Private Equity in the last year and although I got really close to it (interviewed with 3 megafunds and always got to the final rounds) I didn't make it to get an offer.
I'm just wondering if taking the CFA level 1 might help in the future both for PE or for other finance related positions. Remember: I don't have an MBA and have an engineering background.
Thanks!
It will not. Don't do it to yourself, it's not fun and your time is better spent networking.
Oreos - that is the best thing about reading WSO, I too was looking at doing a CFA and the conventional wisdom is, as you point out, to network and spend that effort doing other things.
I should caveat by saying that L1 will do nothing, but the full charter will make a difference; however, it's a big commitment. I'm revising at the moment and it sucks and can say that when I passed L1 my career prospects went no where, it was a nice conversation point but did nothing other than that.
The only reason I did it was because I had the opportunity for it to be paid for by my firm and I had the time (nice working hours). If you're already working hard (e.g., finish at anything later than 8:00pm) then save yourself the trouble and go get coffee with that MD who went to your school.
EDIT: I just thought I'd procrastinate by augmenting my post. I think the CFAI have a great product going, from a business prospective. People see it as a well regarded, rigorous program which they can complete without forgoing earnings like full time school and which is assumed to lead to career progression. The buy-side like their employees having certifications because when raising/managing funds letters after names and prestigious institutions are well received. So demand is very high (just attend an exam to see how many people there are), without having to actually do anything or being truely accoutable for the quality of education.
But when it comes down to it most, if not all, concepts which are of any real value would be learned within the first 3 months of any FT job; without having to cram useless concepts, spending agonizing amounts of time and effort in revising and with no need to pay the CFAI for the pleasure.
Don't do it. The CFA is not helpful for the jobs it was intended for (AM / ER / HF) and is actually less than worthless for PE after you factor in the massive opportunity cost. The whole program is kind of a sham. Source: I am a charterholder. The best way to get into PE is to learn how PE works, network, and kill the interviews. CFA is nothing but a path to pain and disappointment.
since you've already been to final rounds for megafund positions you should try to understand what went wrong in those interviews
Thank you for all your valuable insight. Not sure what went wrong during the interviews, PE recruiting in the UK is just so competitive.
For the last fund I interviewed with I got the bad news directly from one of the interviewers (not from the headhunting company) and he just could't find a single thing that went wrong. He just said that the pool of candidates was very competitive.
The fact that I don't come from an IB background and that I don't speak any really valuable EU language (I'm an Italian native speaker) is kind of a disadvantage for me.
Value of CFA in Consulting (Originally Posted: 01/03/2013)
I know that the majority of CFAs in consulting work within credit risk. However, has anyone or know anyone the other possible lines where CFAs provide value in the consulting world?
I think it is more relevant for business consulting, because after all the research skill set is transferrable. I'm preparing for L2 right now, and I find it useful for industry analysis and firm valuations.
I would like at it this way...
Financial consulting: CFA is helpful for obvious reasons
Economic consulting: (a) securities litigation, e.g. NERA, CFA is helpful because you can apply your knowledge of securities valuation to the work these consultants do and in the industry it is an importation qualification for these consultants since their bread and butter is to speak as experts before arbitration panels and judges. (b) in certain types of consulting that requires regulatory analysis, e.g. power markets consulting at Charles River Associates, CFA is helpful because consultants who are sometimes asked to provide real asset valuation given their expertise in the field (this kind of overlaps management consulting - next).
Management consulting: hard to say, but I agree with above that industry analysis and valuation (you learn a lot of this in CFA L2) will help. I would like to hear what others who are in this field have to say about that.
Also, kind of outside of the question but still worth thinking about: if your ultimate goal is to move from consulting to investment management or research, especially in traditional/conservative investment management or research and you have the time, then CFA may help to you transition from consulting to investment management
C
CFA in consulting - worth it? (Originally Posted: 12/05/2014)
Is it worth pursuing a CFA while in consulting? The alumni job board at my firm seems to have a lot of postings that will accept a CFA in lieu of an MBA. How would a CFA effect exit ops?
Exit opps to what? Other consulting jobs? 2nd/3rd tier shops like Accenture love CFAs from what I understand, not sure about MBB.
No, exit ops outside consulting (sorry, should have been more clear). Like PE, HF, etc.
Mid-tier consulting -> buyside is going to be very hard with either. MBA might be more helpful for PE/VC; CFA for HF/AM. BUT it can't hurt (other than losing 1000hrs).
I don't think it matters much within consulting. For exit opps, depends what you want to do. I know I guy that left MBB for PE with a CFA, not sure when he got it though.
Est fuga ad voluptas doloremque fugiat tempora. Et omnis et rerum. Corporis est dicta et explicabo qui esse tempora. Est consequuntur et porro voluptatem neque cupiditate.
Eveniet unde quia excepturi explicabo voluptas repellendus qui. Dolore sapiente praesentium dolor ad perspiciatis. Facilis quas in sed reiciendis sed quo atque. Delectus tempora sed nam quae cumque rerum cupiditate. Culpa rerum blanditiis tempora sed ea. Quo aut aut tenetur et quas nemo modi.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...
Atque et corporis qui cum rem. Expedita sed nemo consectetur repellat quo sed commodi. Est minima nobis aut pariatur.
Accusamus voluptas velit earum error. Voluptatibus expedita cumque quia ea iure sit neque. Maxime ut corporis sapiente ipsam et laudantium doloribus. Quis nobis fuga incidunt maiores voluptatibus ipsa vitae. Explicabo sit dolore dicta molestiae sed.
Eveniet eligendi non quae molestias repellat totam incidunt. Iste eum ut quasi omnis nemo rerum. Facere deserunt accusamus minima facere enim enim est. Dolores quo sed quaerat sed.