# Career Advice re: CFA



## rab12 (Apr 21, 2011)

Hello, 

Just looking for some career advice around a direction to take. I will be graduating with a BBA, I've already completed the CSC and writing the CPH soon.

I have aspirations to enrol in the CFA program and I'm wondering what kind of jobs I should be looking into while studying for the exams. I'm an FSR at CIBC should I continue with that, should work at becoming an FA first, should I be trying to get into Wood Gundy as an IA?? 

Just looking for the typical path of someone that has or is completing their CFA. 

I worked FT for the bank for 2 years before going back to complete the BBA and I now work PT. 

Basically should I go back FT or would I be wasting my time if I'm looking into the CFA program?? 

(I realize what I'm doing now is far from what someone with a CFA does, but is it a good start?)


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## Sampson (Apr 3, 2009)

Welcome to the forum!

There was a really good thread a few months back about this. Try the search function, and you should find it.

There were lots of examples of people with CFAs and various career paths. It certainly isn't limited to personal financial analysis, nor banks, nor investment banks.


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## MoneyGal (Apr 24, 2009)

CFA is NOT normally on the path for someone who wants to work as a bank IA. You will need/want a CFA if you want to work in a portfolio management firm, or in the back office of a larger investment firm or bank-owned firm. 

If you want to work as an investment advisor, start doing that now and do the CFA on your own time. It will open doors for you but not necessarily in the IA world - much more so in the analyst world (but a CFA, by itself, will not be sufficient to work as an analyst).


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## Square Root (Jan 30, 2010)

Agree with MG. Keep in mind the CFA is quite difficult to get( I know this first hand) and if you are not sure about career path , may be a little much to bite off. On the other hand, you may find out you have a certain talent by studying and passing the CFA? Make sure you have the required time and motivation before starting.


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## rab12 (Apr 21, 2011)

Thanks for the input guys, but I guess what I was really asking is what type of job should I be looking for to get myself on the right track for this type of career?

Thanks!


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## J3ff (Mar 20, 2011)

Sorry in advance for the long post...but here are my thoughts:

Before you pursue the CFA you should have an in-depth understanding as to the courses / topics you will be covering. You should also realize if it is something you wish to pursue or are just thinking about in passing.

While studying for the CFA you will touch on such topics as:
1. Quantitative analysis (e.g., standard deviation, covariance, probability analysis, NPV, etc.)
2. Portfolio Management (e.g., security market line, risk / return objective, etc.)
3. Fixed Income Analysis (e.g., analysis of bonds - duration, yield curve, etc.)
4. Economics (macro and micro-economics)
5. Financial Statement Analysis (e.g., ratios, pension accounting, translation, etc.)
6. Equity Analysis (e.g., dividend discount model, WACC, FCFE, FCFF, equity security valuation, etc.)
7. Derivatives (e.g., options, futures, forwards, swaps, option strategies, etc.)
8. Corporate Finance

Each topic above is a beast on its own so studying for the CFA is not for the weak heart (or mind for that matter). You will be studying for 3 grueling years (1 exam per year) with each examination level progressively getting more difficult. I'll give CFA 2010 pass rates for each level:

- Level 1: 42% pass rate

- Level 2: 39% pass rate (people usually find level 2 to be the most difficult)

- Level 3: 46% pass rate (do not let the higher pass rate of level 3 fool you, because you have to remember, everyone that passed level 3, passed level 2; and still less than 1 in 2 passed level 3. Level 3 in my opinion is THE most difficult.)

(On a more technicality note, you could earn the CFA designation in 1.5 years. For example, write level 1 in December 2011, write level 2 in June 2012, and then write level 3 in June 2013. But if you fail any level, you'll be writing for more than 3 years. The CFA also gives candidates the opportunity to write level 1 twice a year (once in June and once again in December - if the candidate was not successful in June))

Each exam comes with its own quirks. Level 1 is multiple choice, level 2 is multiple choice but in 'Item Sets' (so you read a case essentially and answer a series of questions related to the case), level 3 is short answer (morning exam) and item sets (afternoon exam). Yes, each exam is approximately 6 hours long (3 hours in the morning, 3 hours in the afternoon). You essentially study your rear end off for 1 entire year for one 6 hour exam --> and the pass rates are still only 42% (for level 1 for example). However, do not let this result discourage you as there are definitely some level 1 exam takers that are absolutely unprepared for the exam. My suggestion is, if you're not going to commit your time to study - don't waste your money. Do it right the first time and study.

Career:
Now that you are over the nasties of the exam / study detail above, you have to realize where the CFA will take you. Usually jobs that require the CFA designation include the following:
1. Portfolio Management (buy-side)
2. Equity Research Associate (i.e., researching stocks in various industries)
3. Fixed Income Analyst (i.e., analyzing bonds, preferred shares - essentially fixed income instruments)
4. Investment Banking Analyst / Associate (the corporate finance portion of the CFA material helps in this arena...but I must add that experience in corporate finance is more crucial to your success than good academic knowledge)
5. Stock Analyst (sell-side)
6. Investment Associate
7. Financial Advisor (yes, there are financial advisors out there with their CFA designation - but by no means is the CFA a requirement to become an advisor)

Essentially, any career that touches upon the core topic areas above would love candidates to have or be working towards their CFA designation. I must add that the careers above tend to have long working hours, high pressure, and are deadline sensitive. You may also be working with several rough personalities...however, the experience you get will be incredible....

If what you want is to become an investment advisor with Wood Gundy - you're better off finishing off your CPH, Wealth Management Essentials, get licensed by your company, build a book and voila! Easier said than done of course...Or you could be a CIBC IA, but in this environment you may have to meet a monthly quota of selling certain products and this might not fit your fancy...Probably pursuing the CFP designations is a more appropriate path for an IA as it is more geared towards financial planning.

In a nutshell, you do NOT need your CFA to become an investment advisor. It will certainly give you more credibility (academically) but certainly not a necessity. However, holding your CFA designation as an analyst, portfolio manager, etc. (jobs I outlined above) - it's almost a right of passage; if you can't get your CFA over a certain period of time (i.e., within 3 years as an example), it's likely you won't be staying in that job for long.

Anyway, my final advice is, have a sense of where you want to go career wise. Then decide what educational designations you'll need to tackle to make you the best person in that career.

I hope this helps. 

Oh yes, on a side note Rab, your post makes it sound like you're going to quit your job to study for the CFA. You definitely do not have to do this - you could work full time and still write the CFA exams.


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## MoneyGal (Apr 24, 2009)

Great post from J3ff!!


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## rab12 (Apr 21, 2011)

That was an unreal post from j3ff, very good insight as to what to expect. Thank you, however and I don't mean to sound ungreatful but it didnt answer my question, I understand it is a difficult program and need to be fully committed but I'm not after what to expect from the exams. 

Unless working while studying for the CFA is a bad idea, I'm trying to get an idea as to what to be looking for in a job at this point in time where working towards my CFA is something said company will want me to do. 

If you have or are doing your CFA what is your current job, or what type job did you start out with?


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## Square Root (Jan 30, 2010)

MoneyGal said:


> Great post from J3ff!!


+1


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## J3ff (Mar 20, 2011)

rab12 said:


> That was an unreal post from j3ff, very good insight as to what to expect. Thank you, however and I don't mean to sound ungreatful but it didnt answer my question, I understand it is a difficult program and need to be fully committed but I'm not after what to expect from the exams.
> 
> Unless working while studying for the CFA is a bad idea, I'm trying to get an idea as to what to be looking for in a job at this point in time where working towards my CFA is something said company will want me to do.
> 
> If you have or are doing your CFA what is your current job, or what type job did you start out with?


Hahaha...I'm still not sure if I quite understand your question. So you're looking for a job where working towards your CFA is something the company wants you to do? If this is your question, please refer to the list of jobs in my previous post that outlines the jobs that demand a CFA (e.g., portfolio manager, equity research associate, etc.) If this is not your question, you'll have to be more direct...

To answer your other questions in the latter part of your post, I am currently a level 3 candidate in the CFA program. Although I have put it on hold to finish my CMA designation. 

Hmmm, rather personal questions from the job front that I personally would prefer not to disclose publicly. But I can say that I started out very much like yourself with completing the CSC and CPH as the first educational courses under my belt. I began my career as an Investment Representative.

If you're wondering if the CFA designation will get you the job you so desire...this answer becomes a little more cloudy. I won't lie, the CFA designation is slowly becoming saturated (i.e., many people are writing and passing) and sadly, the high calibre jobs tend to be given to those individuals that not only hold a CFA designation but possibly a graduate level degree as well (e.g., MBA, MA, etc.) There is absolutely NO guarantee that getting your CFA will mean you will get the top Bay street jobs (e.g., portfolio manager, equity research analyst, investment banker, etc.) The CFA has become almost a requirement if you plan to tackle these top Bay street jobs. 

You can view the CFA designation as a benchmark of sorts...if you're currently writing the CFA exam or have the designation already, you can apply to those jobs (emphasis on the words 'can' and 'apply'). If you have never written or have no idea what the CFA designation is, don't even bother applying because chances are your application will not even be looked at. It's very similar to the GMAT, yes, having an incredible GMAT score will definitely get you an interview, but it does NOT guarantee you will get into the MBA school of your choice. For example, you could have a 700+ on your GMAT, get the interview, and not be accepted. There's more to getting a job than simply a designation or fantastic academic achievement. Ok, my comparison of the GMAT and the CFA is like comparing apples and oranges but what I'm trying to get is, the CFA designation is not a guarantee you will land a coveted job. Your network, your soft skills, coupled with your knowledge and experience will get you the job.

Getting your CFA designation is only the FIRST step. You'll still have to earn the experience and you'll still have to trudge through the dirt to get to the gold. In other words, if you have ZERO experience but a CFA designation - that's a great start, but don't expect to be VP of Investment Management in 1 year or once you pass the CFA. The more likely path you'll probably take is start out as an investment analyst (junior position), work your way up to senior investment analyst, then become director of investment management, then senior director, then if you're still lucky (and building that strong network, developing your soft skills, and people like you), then you'll become the VP of Investment Management...

Ok, if I'm WAYYYY off from what you're trying to get at...then I do apologize in advance.

Hahaha...but I can tell you that attaining your CFA is definitely NOT going to hurt your career...


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## MoneyGal (Apr 24, 2009)

One of my brothers is an equity analyst (buy-side). He does not have a CFA but he has about two decades of related experience in his industry (exploration and production oil and gas). It's possible to climb the ladder without a CFA, but you need a related area of expertise.


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## rab12 (Apr 21, 2011)

Thanks j3ff!! 

Those are the types of answer I was hoping to get, thanks for taking another stab at it. I can see how my original question was a bit confusing, I wasn't trying to get educational advice so much as I was trying to get career starting point examples. I bought the CFA up because from what I've research about the CFA is that people with jobs that sound interesting to me hold this designation.

I was basically wondering of going back to the bank FT was a waste of my efforts to progress in a finanical career where I'd be looking to move away from a retail banking/branch banking. All those job titles from your first post all sound great to me, I just realize that you don't start in those roles typically, it was a where to begin question if those titles are the goal and I think you answered my question. 

ps- sorry for asking questions that require too personal of an answer


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## J3ff (Mar 20, 2011)

My pleasure . No need to apologize!


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