How to Pass The CFA Certification

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Professionals aiming to advance their standing in finance and investment can seek academic and industry credentials to demonstrate their knowledge and proficiency. For example, becoming a Chartered Financial Analyst (CFA) is one such path open to these individuals.

For current financial employees considering whether to become a CFA charterholder, it’s worth examining what the process entails and the potential value of the certification. These individuals should also consider the relative merits of other credentials such as a Master of Science in Finance degree, and decide whether to enter such a program instead of or in addition to taking the CFA exam.

 

A CPA student studies a financial graph

 

What Is CFA Certification?

The CFA program is designed to certify investment professionals who have put significant time and effort into refining their financial knowledge and expertise. The requirements are designed to be long and difficult to complete, so hiring managers and supervisors will know credential holders have strong commitment to the industry’s underlying concepts.

The CFA program takes an average of just over four years to complete. Professionals study for the tests for approximately 300 hours, and they have to put in 4,000 hours of work in a role that directly participates in investment decisions. There are three tests. The Level I, II and III exams are administered in person in over 170 cities.

There are presently over 150,000 CFA charterholders, and the CFA Institute describes the program as “the gold standard” of investing expertise. The skills covered in the related materials include portfolio management, investment analysis, and advanced investment techniques. Because applicants must have a bachelor’s degree or professional work experience equivalent to enter the CFA program, the resulting credential is regarded as graduate level.

Charterholders often seek out roles as portfolio managers, research analysts, C-level executives, consultants, and risk managers. The top industries for these credential holders are equities, fixed income, private equity, derivatives, and real estate. While many employees in these fields are doubtless eager to demonstrate their credentials and knowledge, they must first study for and pass the three exams.

 

What Should Applicants Know About the CFA Exams?

Applying to enter the CFA program requires individuals to accumulate four years of either study or work experience. This means candidates are bachelor’s degree holders and professionals who have at least 4,000 hours of work experience. The work used for the application requirement must be from a full-time position, and students may add education together with work experience to equal four years.

The CFA Institute explained that all questions on each CFA exam are based on comprehension of the program curriculum. Each of these tests assesses candidates’ body of knowledge, built up through years of study and preparation.

The Level I Exam, offered in June and December, contains a core of questions about ethics and professional conduct, along with investment tools, asset classes, and some material on portfolio management and wealth planning. The curriculum focus for the Level II Exam is similar, with more ethics and portfolio management questions. The Level II and Level III Exam are only offered in June. Once students reach Level III, they’ll find the investment tools questions have been replaced by a much greater focus on portfolio management and wealth planning.

Passing these exams is the main requirement to become a charterholder, but there are other necessities. For example, while applicants can enter the program without completing their 4,000 hours of work in advance, they will then have to gain that qualified experience while participating. Furthermore, charterholders need two or three letters of reference from professional connections.

 

What Goes into Earning an Online MSF?

The CFA program is not the only graduate-level option for individuals seeking to deepen their knowledge and credentials in investment. For instance, a Master of Science in Finance degree may represent a faster and more versatile credential. Earning an online MSF from an accredited university is one way to highlight and enhance commitment to financial careers.

Selecting a Degree Track

Professionals seeking roles such as corporate finance officer, director of finance, wealth manager, underwriter, and more can bolster their credentials in an online MSF program. Within the general framework of such a program, it’s possible for students to personalize their experiences by choosing tracks of study. Online MSF students at Northeastern University’s D’Amore-McKim School of Business, for instance, can select either Investment Finance or Corporate Finance as a guiding track.

While the Investment Finance curriculum has significant overlap with the concepts and ideas included in the CFA program, the Corporate Finance Track is focused on other aspects of money management and decision-making, such as valuation, treasury management, strategy, budgeting, mergers, venture capital, and more. Individuals who want to prove their financial mettle without entering the investment sphere can select this path.

When investment is a student’s main area of interest, the short potential timeline and overall convenience of the online MSF program may prove to be compelling reasons to select this educational track instead of or in addition to CFA certification. It’s possible to earn an online MSF in 16 months through flexible course scheduling. Classes are taken asynchronously on participants’ own time, allowing them to continue full-time work in finance while studying.

 

Adding an MSF to a Resumé

The amount of specialization available within the MSF program includes a combination with another credential. Individuals seeking leadership roles and considering a Master of Business Administration degree can combine the MBA with an MSF, using a dual degree option to work toward each simultaneously.

Earning a graduate-level credential in finance, whether it takes the form of an MSF degree or CFA chartering, is a way to demonstrate a continued commitment to learning the best practices of investment and other key financial concepts. When applicants are seeking high-skill positions with significant competition, these additional credentials could prove to be differentiators.

The core appeal of CFA and MSF programs is similar, with each type of education providing both practical, hands-on skills and a deep academic look at the concepts that underlie today’s global markets. The former is a longer process with a close focus on investment, while the latter can take less time and is driven by expert faculty members from within the industry.

 

Learn more about the Online MSF program and see if it’s the right path for your professional development.

 

Recommended Readings

Should You Pursue a Master of Finance or CFA Certification?

Becoming a CPA: What You Need to Know

Northeastern University Online MSF program

 

Sources

CFA Institute – The CFA Program

CFA Institute – Become a Charterholder