CFA Exam Intro

The Chartered Financial Analyst (CFA) designation is an international professional certification offered by the CFA Institute (formerly AIMR) to financial analysts who complete a series of three examinations. To become a CFA Charterholder candidates must pass each of three six-hour exams, possess a bachelor’s degree (or equivalent, as assessed by CFA institute) andhave 48 months of qualified, professional work experience. CFA charterholders are also obligated to adhere to a strict Code of Ethics and Standards governing their professional conduct.

The CFA Exam Introduction

The CFA designation

The CFA is a qualification for finance and investment professionals, particularly in the fields of investment management and financial analysis of stocks, bonds and their derivative assets. The program focuses on portfolio management and financial analysis, and provides a generalist knowledge of other areas of finance.

The CFA designation was first awarded in 1963.As of August 2010, CFA Institute has more than 101,000 members around the world, including more than 89,000 CFA charterholders.

The predecessor of CFA Institute, the Financial Analysts Federation (FAF), was originally established in 1947 as a service organization for investment professionals in its societies and chapters. In 1990, in hopes of boosting the credential’s public profile, CFA Institute (formerly the Association for Investment Management and Research or AIMR) was created from the merger of the FAF and the Institute of Chartered Financial Analysts (ICFA). Many Financial Analysts (FA credential) were grandfathered into CFA charterholders without taking any of current levels as a result of the 1990 merger between the ICFA and FAF.

The CFA program began in the United States but has become increasingly international with many people becoming charterholders across Europe, Asia and Australia. By 2003 fewer than half the candidates in the CFA program were based in the US and Canada, with most of the other candidates based in Asia or Europe. India and China have shown some of the highest growth from 2005-2006 with increases of 25% and 53% respectively in the total number of charter holders.

Requirements

The basic requirements for participation in the CFA Program include

1. The basic entrance requirements for the CFA Program include:

• You must have a bachelor’s (or equivalent) degree

• or be in the final year of your bachelor’s degree program at the time of registration*
• or have four years of professional work experience (does not have to be investment related)
• or have a combination of professional work and college experience that totals at least four years. Part-time positions do not qualify, and the four-year total must be accrued prior to enrollment.

3. Find an available test center location.

4. Create an account or log in to enroll in the program and register for an exam.

Candidates generally take one exam per year over three years (assuming a pass on the first attempt). Fees as of December 2009 for all three exams range from $710 to $955, depending on the date on which the candidate registers to take the exam, plus an additional $400 to $480 for program enrollment for new members. Exams are challenging, with only 42% passing the Level I, 39% passing Level II, and 46% passing Level III exam in June 2010.In 2006, Europe achieved the highest average pass rate for the Level I, II and III of the exam with an overall success rate of 57% of candidates versus 54% for the USA and 49% in Asia and Pacific.