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No.
Makes sense. Thanks.
It's useful as it gives you a little bit of background on the fundamentals of finance. If you attend IBD/Research interviews they will ask you what is discounted cashflow analysis, that type of things
I'm familiar with Mergers&Inquisition's criticism of the CFA designation, but I think if you have the free time, why not do it? If you don't think it'll be helpful for I-Banking, then don't include the title on your resume.
However, I do this the CFA designation is a plus for Investment Management, if you want to keep your options open!
I think a major reason why Mergers&Inquisition dislikes the CFA is because it takes up a lot of time that could be used on other "more useful" things such as networking your way to your next job! :-)
All good points haha. In terms of asking about DCFs and fundamentals of finance, they would ask that to anyone. So I mean that said, I would be prep for that either way regardless of CFA or not. The point about CFA taking up a huge amount of time is definitely valid. There's so many things that you could be doing in the time that you'd be studying CFA.
Also, if you are still in school, you can try to audit some MBA-level finance classes, especially those focused on Valuation & Modelling, and you can put it on your resume that you audited those classes.
Most top MBA programs now have 2-credit-hour courses that you may want to audit. They are really quite useful, and it will look rather impressive on your resume.
How would you incorporate it into your resume? I'm just curious as to where you think it should go.
For example, if you have a "Relevant Coursework" section on your resume, you can list your relevant classes as usual (the ones you actually took for credit), and then after that, write something like "Audited FIN 280 - Financial Modeling (MBA level)"
Hope this helps!
Sounds good, I'll see if I can somehow incorporate that into my resume. Thanks for the advice.
Well if you plan to do your masters (not MBA) right after undergrad, you can do level I in June before your internship, and one in December or June the following year. So instantly you've got 2 levels of CFA under your belt and it shows that you're really determined to get into banking/finance jobs. But obviously that will really eat into your "free" time.
level 2/3 is only offered in june
Not sure why, but in my experience CFA in banking seems much more popular in Canada. I've never figured this one out.
I've heard the same thing, for some reason Canada seems to value CFAs a lot more. I mean Toronto is the highest CFA/capita, and second highest CFA pop after NYC in the world... Don't get it.
I read somewhere that the CFA is required by Canadian regulators for many finance positions such as research, which might explain the high CFA population in Toronto.
I'm a Canadian and I haven't heard of/seen any jobs that require CFA. I'm guessing it's just something that is now just self-perpetuating. Everyone wants to be competitive and sees that there are tons of people with CFAs, so they go for the CFA. It may not be useful but at least your not the guy that doesn't have it.
Is useful for any position in Finance. All the kids in here talking about how it is not useful haven't studied for it, so they dont know.
CFA is useful for really understanding the driving forces behind all the accounting statements and also helps you understand debt/equity structure, which is something that is valuable in banking. Also, a lot of people seem to want to transition to an HF position after some time in banking.
A CFA in the Asset Management realm is like a secret handshake among HFmanagers. Plus you impart such a high degree of motivation and self worth, more than an equally qualified candidate.
In short, there is NO WAY the CFA can hurt you. If it is not 100% applicable to your position you still have the knowledge and power of the designation. For instance, in this economy if you had two similar candidates, same GPA same course work blah blah blah, yet one was a cfa and the other wasnt, it would be clear that the CFA has worked harder and devoted more time to understanding the industry.
There is definitely a way that the CFA can hurt you. The same way spending your twenties on a desert island drinking coconut milk and picking your nose can hurt you. It's a waste of time. And time is what we have, gentlemen. If someone else is meeting, greeting and happy feeting around with various network contacts, while you are slaving away on some certification that will cause your interviewers eyes to completely glaze over, then the story will not end the way you want it to.
This is taking it a little far. It's not like you're having nightly dinners with managing directors and out yachting all weekend with hedge fund managers.
CFA takes time from reading / watching tv / hanging out with girlfriend / sleeping. I agree it's a huge waste of time, but it's not like you'd be doing anything more productive unless you were starting your own business.
You can make the same waste of time argument for any education.While you were in school other kids were talking politics with bill clinton and discussing technology with bill gates.
I've heard that it makes you less competitive at least in the earlier years since the CFA designation implies that you're more qualified, and therefore should be paid more.
How useful is a CFA designation for IB? (Originally Posted: 10/27/2007)
hiya everyone,
I have been contemplating taking a CFA, I would like to seek opinions on the benefits and advantages a CFA Level 3 grants to the holder? How does it affect exit ops after a 2-3yr stint in IB?
Is it useful or practical at all for a career in IB/IB->PE?
Thanks!
I'm not 100% sure about this question, but it seems like alot of people I have interviewed with at the Associate and VP/Senior-Associate level have the CFA designation. My guess is if you pursue the CFA as an analyst, and work hard, you probably have a greater chance of getting invited back for a third year.
bankerbear...do you mean associates/VP's at ibanks or at PE firms?
Personally I think bankerbear's advice is terrible. How are you suppossed to study for the CFA when you are working til midnight 7 days a week? Also, CFAs are really only important for the buy side... So if you want to skip that third year, and head to PE early, then yes, it would be nice to have your CFA (level 1 passed would be acceptable I believe). But if you want to stay in banking, why bother?
It's not really advice, just an observation about associates and VPs in IB. I'm thinking if they have it, it's probably all the more important in the PE/HF world. But i'm not really sure.
Value of a CFA (Originally Posted: 09/01/2006)
Can one jump to associate in ibanking with just a CFA and several years of finance, but not ibanking?
you must be nuts
It is possible...but highly unlikely. Any chance of success if probably at the middle market level.
Usefullness of a CFA (Originally Posted: 12/12/2007)
Quick Question:
If you plan on getting your MBA, but are looking to work 2-3 years before going back to school, what are your thoughts on starting your CFA?
This is of course figuring you have the extra time to work on it? The reason I am asking, is I have a friend who is a 1st year analyst and he is working on his before office hours, and it got me to thinking...
Insight?
I'm wondering about this too, and additionally how much added benefit would you get if you say went to china and taught english for a year after a 3 yr analyst stint.
I'm thinking analyst stint, 1-2yrs in china teaching english because I think it will be awesome and I want to learn chinese, then mba/ms dual program.
Meh. I'm finishing up my MBA and just took level I of the CFA a few weeks ago. My opinion: 1. I'm not from a top tier school so I'm going to do anything I can to make me look like I go above and beyond (cause I do). 2. The test isn't as hard as they say it is. Prepare properly and its pretty easy. (Sample question: What is the maximum value of an American put? Duh.) 3. A lot of C level positions are asking that you have the CFA designation so unless you plan on being an analyst for the rest of your life...
that is along the lines of what i was thinking falcon00...
CFA - How helpful is the CFA when trying to get into IB? (Originally Posted: 09/14/2007)
How helpful is the CFA designation when trying to get into IB? I got my undergrad in Finance 3 years ago from a 2nd tier school and have been working as a bank examiner and in commercial banking since graduation. I want to pursue a career in investment banking, but realize I didn't go to a top school, i'm not in the right geographic location, and probably don't have the right experience. I know I'd have to enter as a first year analyst, and that is find with me. What would be my best option: CFA, bschool, or something else?
i would say Bschool is your best option.
However, it's always good to call everyone you know, coldcall, etc. at IB's before you go for your mba. CFA is looked good when getting a job in assett/investment management. try looking into that field aswell.
If your end goal is a top BB then you will have to matriculate into a top MBA program. To do this you will need a GMAT score in the 80% range of the schools average, strong work experience with demonstrated leadership, solid extra-curriculars-community involvement, and a well-thought out essay package. If you have a weak ungrad and/or GPA you may want to consider taking quant related courses at a university of even a community college (and obtain an A) to demonstrate your intellectual horsepower and willingness to address the weaknesses of your application.
In short, you should not do a CFA for investment banking. If you would like a designation that will help you to get an analyst or associate level position at an investment bank, I would suggest pursuing the CI designation. The CI (Chartered Investor) designation is granted by the CI Institute, and tests you on your financial modeling and valuation skills in an investment banking and private equity context. There are three levels for the CI Program, just like the CFA:
LEVEL I :
Comp Company Modeling
Comp Transaction Modeling
DCF Modeling
Financial Statement Modeling
LEVEL II :
LBO Modeling
Merger Modeling
LEVEL III :
Advanced LBO Modeling
Advanced Merger Modeling
Is the CFA exam worth it? (Originally Posted: 01/24/2011)
Is the CFA exam worth taking or is it better to take it when you are sponsored by a company? I just graduated from college and am currently unemployed. I have basically a year from now until graduate school where I am getting a masters in computational finance. During this year, should I take the CFA exam or just wait until after graduate school when I have a job?
I would say wait till you have a job. I interned at a hedge fund and everyone there didn't take their CFA Level 1 until they were out of school.
take it now. Take advantage of the time off you have when you're not in school or working. It costs $1000 per level, which is not that much money so if you can afford it while you're unemployed and would be so far ahead of the competition who are working full time and barely have time to study. You'll regret it if you don't at least take level 1 now
If your end game is to work for a hedge fund, mutual fund, some type of investment management shop, etc... then you should absolutely take the CFA. The CFA credential is not going to magically open any doors, but it will certainly help. A lot of the local CFA societies have scholarships for candidates. I'd definitely check there first so you don't have to foot the $1,400 fee alone.
The CFA is less $1,000 per level, except Level 1. The first exam includes a one-time program entry fee of $500ish. Each level after that is between $600-800 depending on when you sign up.
Some local societies give out scholarships. I'm still in school and plan on taking it. I think that I will have much more free time then when I am working full time.
Your unemployed and have a year till school starts and want to take it. A ton of people I've spoken with say CFA is much more of a requirement in certain industries (AM) and somewhat pointless in others.
It is worth it if the industry you are pursuing thinks it is valuable.
CFA and the future ibanker (Originally Posted: 03/04/2007)
I was wanting to study for the CFA, but I was looking into it, and I hear that people who take the CFA exam go into investment management. Is this true? Could the CFA help a future ibanker? Thanks in advance.
No, only equity research or buyside. IBD does not really look at the CFA with any sort of respect. It's like going into IBD with a JD. Cool, but doesn't really mean anything.
CFA for ibanking valuation (Originally Posted: 06/05/2007)
I know that CFA is mainly for investment management and equity research. Yet i'm just wondering if passing the CFA exam will prepare one well for the IBD valuation(DCF,LBO...)tasks ? Or ibanking actually requires much more analytical skills than those required by CFA with respect to the M&A and corporate finance knowledge ? Thanks.
It will prepare you, but IB valuation is no rocket scheince, although some ibankers will try to justify their existence by claiming that it is :) Most of it is more familiarity than technique and you should be just fine with what you learn on the job. If you plan to stay on as an associate, most of what you'll need is higher level back of the envelope thinking.
"Living the dream 24/7 on http://theallnighter.blogspot.com"
Yeah, i think CFA does cover more materials in both depth and breath than ibanking does. Although IBD does give you more money early on at junior levels than CFA oriented jobs (equity analysis or investment management), the skills that CFA sets you up in the long run will eventually give you a bigger pay than the banking people.Top portfolio managers make significantly more money than MD's.
any other comments ?
This question has been asked and answered since 1960s.
No, it's not a ticket into IBD. It doesn't go that deep into valuation, either. Just a casual glance at the level One syllabus would answer your question.
Level 2 goes significantly deeper, but at level 1 the valuation elements are merely superficial.
The common phrase for the CFA is "A mile wide, a foot deep". 1,300 pages for each level, covering FSA, Econ, Ethics, Stats, Corp fin, Alt. Inv., Derivatives, Debt instruments...etc............etc...etc.
I just think portfolio management has a better future than IBD. It's more intellectual,whereas banking is more hardwork and dedication.
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