How much finance should I be comfortable with?
I am in the verge of registering for CFA Level 1 Exam. Should I rather spend my money and time going thru Real Estate Financial Modeling course or Argus certification?
I want to learn more about real estate finance, but I feel like CFA doesn't cover them a lot. And, at the same time, I feel like REFM or Argus will require some of the real estate finance knowledge. Would knowing basic basic finance concepts be ok for going thru the REFM course or Argus certification?
I don't know which one I should go for. My indecisiveness is killing me. Please advise me.
PS. I know this kind of question has been covered by many threads; I read thru them and the comments, but still couldn't find the right answer.
CFA provides a good grounding for financial concepts and certainly adds credibility across the board, I imagine. I've never seen a RE job posting that mentioned CFA, but if I was interviewing someone with it I would be pretty confident they knew at least some pretty fundamental and advanced finance theories/formulas. I know people who have worked on Wall Street for years and still lament when they have to study and take the CFA, even though they probably know the material best. So, there's that. However, see below.
Anecdote: I know someone on the structured finance/debt lending for a MM bank. they could have been joking, but they said "I'm one of the many finance guys that has a CFA and doesn't 'use it." Take that with a grain of salt, but I feel like the CFA is a bit tailored to very specific securities, hedging strategies, equity research/investments than your more plain vanilla debt lending, especially when it comes to real estate.
Everyone above me pretty much hit the nail on the head, however I do have to make one cryptic observation.
In this industry, I am honestly perplexed by the large amount of people who truly don't have a simple understanding of how capital markets work. I am not expecting someone in acquisitions, to have an innate knowledge of the math behind a CDS swap - however, he/she should be able to understand how the markets affect CRE.
At the end of the day, an investment decision should go beyond on whether it has a good cap rate or levered IRR. You need to have a strong macro-view to formulate your investment thesis.