CFA (Chartered Financial Analyst) is an internationally sanctioned diploma in the field of Financial Management and Investment Management catered by the CFA Institute. Chartered Financial Analysts (CFAs) are highly honored in their field of work and have profound knowledge in investments, finances, banking and so on. There is a 3 step process to become a Chartered Financial Analyst: · Enter the CFA® Program · Pass the three levels of Exam · Get CFA® institute.
CFA Charter holder is in demand not only inside the country but also outside the country. To become a good CFA Charter holder the student should have computer knowledge and have good communication skills. The students got good salary packages from companies. CFA is a good career option.
How to Become a CFA Charterholder
The completion of the CFA course comes along with huge opportunities and advantages attached to it. A candidate who has triumphantly completed the CFA course is easily presented with a big number of job opportunities as a chartered accountant or a financial advisor in fields like Accounting, Taxation, Financial Services, Auditing and many more. These jobs also promise high incomes with an average ranging from ₹ 4 Lakhs up to 40 Lakhs in India and abroad.
The minimum education requirement to apply for the CFA exam is a graduation degree in any field and work experience of at least 4 years.
To get a CFA (Chartered Financial Analyst) diploma, students need to finish the three levels of examination, which are, Level 1, Level 2 and Level 3. These examinations are usually completed by the candidates within 1.5 to 4 years depending on their capability. Candidates can be qualified for the CFA exam by conducting self-study using the material (either online or hard copy at a nominal cost) administered by the CFA institute once a candidate has been registered.
Since the exam is expressed to be difficult, there are a variety of books and other study material available and there are also numerous academies and tutoring centres that offer training for CFA preparation.
Focal Points for the CFA Course
CFA stands for Chartered Financial Analyst. The CFA course is one that commences investment and finance based skills in an applicant. It is universally perceived program that contributes a solid base to the world of investment analysis. It is an international course provided by an American-based establishment known as the CFA institute which assigns the syllabus for the CFA program. CFA gives you a look into the real investment market. While an umpteen number of candidates apply for the program every year only 40-50% of the candidates are qualified to go ahead. It is considered to be one of the most difficult courses around the world.
The duration for this course starts from 1.5 years and goes up to 4 years. Candidates are to have a graduation degree in any field and work experience of at least 4 years to be eligible for the exam. Exams for CFA are computer based and are conducted in three levels where candidates are examined twice in a year (June and December) for Level 1 and one time again (June) for Level 2 and 3. These exams are conducted to at an international level by the CFA Institute to become a Chartered Financial Analyst (CFA).
Who is the CFA program for?
Any personnel who has recently received their graduation degree with an interest in the world of finances and investments will be able to gain a lot of knowledge.
For an academician who is teaching investments and finances, this program provides them with better and more dependable credentials and also gives them profound understanding of their subject.
It is also beneficial for a professional who is working in the finance and investment industry already to gain better understanding about their profession.
Anyone interested in becoming well versed and getting educated about the world of finances and investments.
Top CFA Institutes
Some of the highly respected universities offering preparation for the CFA program are
- Narayana Business School in Ahmedabad with an average fee of ₹ 1,25,000
- Shri Chimanbhai Patel Institute of Professional Training (CPIPT) in Ahmedabad with an average fee of ₹ 66,000
- International College of Financial Planning (ICOFP) in New Delhi and Kolkata with an average fee of ₹ 40,000
- Central India Institute of Management Studies (CIIMS) in Jabalpur with an average fee of ₹ 32,500
There are also various well-known establishments offering preparation for the CFA program such as FinGuru, FinTree and IMS Proschool in Delhi, Chennai, Ahmedabad, Mumbai, etc. There are numerous internet learning gateways also which you can go to for CFA preparation like Kaplan Schweser, Soleadea, Schweser, The Princeton Review CFA, etc.
How to get a CFA certification
Level 1 of CFA
Level 1: Admission
The first step is to create an account the official website of the CFA Institute and provide the mandatory information and choose your favoured exam centre.
If the candidate is qualified and want a scholarship, they are to register early in order to submit their scholarship application.
The next step is to pay the exam fee along with the application fee if the scholarship application is not accepted. The fees, depending upon when the application is submitted, can be paid through wire-transfer, credit card, etc.
If it is the candidate’s first time applying for Level 1 of CFA an additional enlistment fee of USD 400 is to be paid.
The deadline for the application fee along with the average cost is as given below
- Early Admission with a fee of USD 700 for which the deadline is October 2nd 2019 and the deadline for 2020 is March 25th.
- Standard Admission with a fee of USD 1000 for which the deadline is February 20th 2020 and the deadline for December 2020 is August 19th.
- Late Admission with a fee of USD 1450 for which the deadline is March 11th 2020 and the deadline for 2020 is September 9th.
It is necessary for the candidate to read and acknowledge the Candidate Agreement.
While applying for the first CFA examination, candidates are also required to submit their Professional Conduct Statement (acknowledging suitable reprimands, Investigation, litigations and so on) and it is to be submitted again before every examination and on a yearly basis.
Exam Pattern for a Level 1 CFA Examination
The exam is held in two sessions each lasting for 3 hours, morning session and afternoon session. A total of 240 MCQs (multiple choice questions) are divided among the two sessions.
The subjects remain the same for examinations of all levels, including topics like Fixed Income Derivatives, Ethical and Professional Standards and more. More questions on the ideas and devices used for management of investments and valuation purposes will be asked in the examination.
Focal Points for the Level 1 CFA Examination
Two sessions, morning session and afternoon session, with time duration of 3 hours each. Each session will consist of 120 MCQs (a total of 240 MCQs). The exam is held in the first week of June and December and an average of 43% is required to pass the examination.
Exam Weightage for a Level 1 CFA Examination
The subjects covered by the exam along with the weightage they hold are as follows
- Financial Reporting and Analysis holding a weightage of 15%
- Ethical and Professional Standards holding a weightage of 15%
- Equity Investments holding a weightage of 11%
- Fixed Income holding a weightage of 11%
- Economics holding a weightage of 10%
- Corporate Finance holding a weightage of 10%
- Quantitative Methods holding a weightage of 10%
- Portfolio Management and Wealth Planning holding a weightage of 6%
- Derivatives holding a weightage of 6%
10. Alternative Investments holding a weightage of 6%
Level 2 of CFA
Level 2: Admission
The same process of admission for Level 1 is to be followed for Level 2.
If the candidate is qualified to apply for a scholarship, they can apply for it. If the scholarship application is not accepted, the next step is to pay the exam fee after selecting the exam centre favoured by the candidate before the deadline. No admission fee is required for Level 2.
Again, it is necessary for the candidate to read and acknowledge the Candidate Agreement along with giving a copy of their Professional Conduct Statement.
Exam Pattern for a Level 2 CFA Examination
Similar to Level 1, the exam is held in two sessions each lasting for 3 hours, morning session and afternoon session. A total of 120 MCQs (multiple choice questions) are divided among the two sessions.
The attention is given to the assets valuation and the candidates should apply the ideas and devices that they have learned in the Level 1 Examination.
Focal Points for the Level 2 CFA Examination
Two sessions, morning session and afternoon session, with time duration of 3 hours each. Each session will consist of 60 MCQs (a total of 120 MCQs). The exam is held in the first week of June and an average of 45% is required to pass the examination.
Exam Weightage for a Level 2 CFA Examination
The subjects covered by the exam along with the weightage they hold are as follows
- Financial Reporting and Analysis holding a weightage of 10-15%
- Ethical and Professional Standards holding a weightage of 10-15%
- Equity Investments holding a weightage of 10-15%
- Fixed Income holding a weightage of 10-15%
- Portfolio Management and Wealth Planning holding a weightage of 10-15%
- Economics holding a weightage of 5-10%
- Corporate Finance holding a weightage of 5-10%
- Quantitative Methods holding a weightage of 5-10%
- Derivatives holding a weightage of 5-10%
10. Alternative Investments holding a weightage of 5-10%
Level 3 of CFA
Level 3: Admission
The candidates are expected to fill an admission form online via the official CFA Institute website and choose their favoured examination centre.
The subsequent stage is to select the appropriate qualification measures from the given options. Additionally, fill in your profession, employer along with the employer’s address or qualification.
Read and acknowledge the Candidate Agreement. Go ahead and choose the format in which you’d like to receive the CFA Study Material.
The fees can be paid through wire-transfer, credit card, etc.
Exam Pattern for a Level 3 CFA Examination
The exam pattern for Level 3 differs from the other two levels. Item Set and Constructed Response in the form of an Essay are the significant types of questions and Portfolio Management and Wealth Planning is given a most importance.
The Morning session comprises of Essay Questions that run from 8-12 questions in number with a few subparts, with a limit of 180 points. The value of each point will be given in the exam book on the day of the exam.
Focal Points for the Level 2 CFA Examination
Morning session consists of essay type questions and the afternoon session consists of 60 questions divided within 10 case studies. Each session has a time duration of 3 hours and will consist of essay type questions and MCQs. The exam is held in the first week of June and an average of 56% is required to pass the examination.
Exam Weightage for a Level 3 CFA Examination
The subjects covered by the exam along with the weightage they hold are as follows
- Portfolio Management and Wealth Planning holding a weightage of 35-40%
- Fixed Income holding a weightage of 15-20%
- Ethical and Professional Standards holding a weightage of 10-15%
- Equity Investments holding a weightage of 10-15%
- Economics holding a weightage of 5-10%
- Derivatives holding a weightage of 5-10%
- Alternative Investments holding a weightage of 5-10%
CFA Qualifications
To apply for the CFA course, candidates are required to have the following qualifications.
The candidates need to have a Bachelor’s degree in any field from a perceived university or institute though candidates coming into the course are usually from a similar foundation.
Applicants who are in the last year of their Bachelor’s degree program can likewise enroll to the CFA course but they must get their graduation degree before enlisting for the Level 2 examination.
Applicants need to have at least 4 years of work experience and candidates who are entrepreneurs or are doing internships will also be considered as work experience, given that they are paid for their ventures.
Applicants enrolling for the course need to have a valid passport.
Admit Card for CFA Exams
Candidates taking the CFA Exams are given an admit card which is provided by the CFA Institute. The admit card can only be downloaded online as there are no hard copies sent. In order to be identified and verified, it is mandatory for the candidates to carry the admit card along with a valid passport with them to the exam centre.
CFA Examination Centres
Around the world, there are about 193 areas in 95 nations that are a part of the CFA exam centres. Candidates from India can choose one the given locations:
For the exam conducted in June, Bangalore, Hyderabad, Kolkata, Lucknow, Pune, New Delhi, Bhopal, Chennai, Mumbai and Ahmedabad.
For the exam conducted in December, New Delhi, Mumbai, Lucknow, Kolkata and Bangalore.
Modifications and Inclusions in the CFA Examination
Starting from 2023, The CFA Examination for Level 1 will be held in four windows, i.e. February, May, August and November.
At least 7 days are given for each window during which the candidates can take the CFA Exam.
The candidates need to wait for a minimum time period of 6 months if they wish to retake the Level 1 Exam and there also has to be a 6 month gap before applying for the Level 2 exams.
From 2023 onwards, the exam will be led on a PC-based mode only and not the standard pen and paper mode.
Essential Dates to Remember for CFA Exam in 2020
- Admission for June starts on August 8th 2019 and for December, it starts on February 5th 2020
- The deadline for early admission for June is on October 2nd 2019 and for December it is on March 26th 2020
- The deadline for standard admission for June is on February 20th 2019 and for December it is on August 19th 2020
- The deadline for late admission for June is on March 11th 2020 and for December it is on September 9th 2020
Points to Remember While Preparing for CFA Exams
The CFA exam is considered to be one of the most difficult exams in India and across the world. Candidates pursuing the course work for the exams tenaciously, with utmost dedication. The difficulty rises along with the levels as the subject dives into details. It is necessary to keep in touch with the changing syllabus and exam patterns. Follow the study material and curriculum given by the CFA Institute. On the off chance that the candidate is choosing training or going to a coaching centre/institute, aside from self-study, it is necessary to keep practising questions repeatedly to make sure the candidate has progressed their knowledge of theory. Taking notes for every subject and solving model exams or mock tests is important for all levels. During the exam, candidates are allowed to use calculators as required. The candidate should try avoiding skipping any questions even though they will not be negatively marked. It is important for the candidate to feel comfortable during the exam so they must dress accordingly and prepare themselves to pay full attention.
Difference between CFA and CA
Though both the programs are exceptional, the CA exams are considered to be relatively easier. Depending upon the candidates’ interests they could opt for any one of the courses.
Some of the significant differences between the two programs are:
- CFA stands for Chartered Financial Analyst and CA stands for Chartered Accountancy
- The CFA exam is conducted by the CFA Institute while the CA exam by the ICAI (Institute of Chartered Accountants of India)
- The average time taken to complete the CFA program is 1.5-4 years while the CA program takes around 4-5 years
- While the CFA course is universally recognised the CA program is not.
- The average annual income for CFA is INR 12 Lakhs to INR 20 Lakhs and for CA it is INR 7 Lakhs to 20 Lakhs
- The average admission fee for CFA is INR 1-2 Lakhs and for CA it is under 1 lakh.
- The CFA program aspires to give standard training and education in the field of investments and financial analysis. The candidates complete the course after passing the three Levels, i.e. Level 1, Level 2 & level 3 and the CA is accredited in the world of commerce and accountancy and the exam is to be qualified in a number of rounds, i.e. CA Foundation, CA Intermediate and CA Final.
CFA Curriculum
CFA exams of all levels deliberate over the same mandatory subjects. Candidates are expected to study each subject carefully in order to pass the examinations. Even if the focus is given mostly to the same ten subjects the level of difficulty rises with each level.
The subjects along with their description are as follows:
- Portfolio Management and Wealth Planning deals with the significance of portfolio management and wealth planning.
- Finance Reporting Analysis deals with understanding the usual procedures and regulations of financial reporting.
- Quantitative Analysis deals with Descriptive Statistics, Probability Theory and features decision making in Investments.
- Ethics helps you understand the importance of professionalism and principled behaviour in the investment world.
- Alternative Investments introduces you to the world of investments in real estates, hedge funds, infrastructure, etc.
- Derivatives aides in understanding the fundamentals of derivatives and their market
- Corporate Finance guides you on aspects of corporate governance.
- Fixed Income Analysis deals with getting educated about fixed income securities, elements that risk these securities and how to maintain the level of security along with the estimation methods.
- Economics helps in understanding the stipulations ad grants of people and their firms.
10. Equity Investments deals areas of the economy that handle the security markets, indexes and equity investment.
CFA Jobs and Job Descriptions
After successful completion of the CFA program, candidates can apply for high paying professions including government jobs and jobs in private sectors too with an average salary of INR 8-20 Lakhs.
Given below are some of the CFA jobs and their descriptions:
- Chartered Financial Analysts are answerable for breaking down financial portfolios and making suggestions based on the equivalent. They set the monetary objectives and recognize the key strides to accomplish them. They get an average annual salary starting from INR 9.35 Lakhs
- Market Research Analysts are expected to give an interpretation of the data provided to them by the employer. They get an average annual salary starting from INR 6.50 Lakhs
- Portfolio Managers are usually assigned to private clients whose financial and investment status is to be handled. They get an average annual salary starting from INR 8 Lakhs
- Business Consultants are expected to handle an organisation’s financial statements and assist them in achieving their goals. They are also expected to handle business related problems and provide possible solutions.
- Investment Managers help clients in to make money by making the right investments.
- Private Bankers keep up the relationship with the bank’s customers and screen their requirements. They give the credit, advances and provide the customer with numerous solutions.
And the list goes on.
Future in CFA
Getting jobs which pay handsomely is smooth in the investment and financial analysis industry and it is a big deal in anyone’s career. A certified candidate is likely to earn more than a person who is not accredited. After the completing the CFA program the aspirant is now opened to diverse careers in major industries like investment and financial analysis, banking, insurance, mutual funds and many more.
Due to the globalization and increased industrialisation, the CFA program has been holding an increasingly huge appeal. Practically all the renowned organizations lean toward assigned CFAs than different experts as they are exceptionally prepared and skilled in this field.
The most advantageous aspect of the CFA program is that it is recognized and accepted worldwide increasing the chances of getting into high paying professions and allowing the candidates to get a job in not only India but abroad too.
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