CFA Full Form

A CFA that stands for is a worldwide recognised professional qualification awarded by the CFA Institute (previously the Association for Investment Management and Research) that examines and certifies financial analysts’ capability and integrity. Candidates must complete three tiers of tests covering economics, financial management, ethics, accounting, and security analysis. The CFA charter is generally considered as the investment analysis field’s gold standard and is among the most esteemed distinctions in finance. The CFA institution, with 9 locations worldwide and 156 confined member organisations, awards accreditation. 

Qualify CFA

An applicant must satisfy one of the given educational criteria prior to qualifying for a CFA charter holder.

1. The applicant must have four years of professional job experience, a bachelor’s degree or must be studying in the last year of a bachelor’s degree, or a four-year mix of work experience and study.
2. The bachelor’s course must be finished before applying for the Level II test for the undergraduate qualification.
3. Candidates must have completed the evaluation in English, have an international passport, meet the proficient behaviour admission criteria, plus reside in a participating nation in addition to having a high school diploma.

After fulfilling the enrollment conditions, the candidate should necessarily pass all three levels of the CFA program in sequence. The aspirant must next become a member of the CFA institution and clear yearly dues. Lastly, they ought to attest that they follow the CFA Institute’s policy of ethics along with professional conduct every year.

CFA Exam Levels

Qualifying the CFA Program tests necessitates a high level of discipline and substantial study. With the exclusion of Level I, which may also be conducted in December, the three tests are only offered once a year in June.

Despite the fact that the tests can be attempted several times as necessary, each exam usually needs students to prepare for more than 300 hours. Many applicants are discouraged from continuing the CFA Program after not passing one of the three levels due to the significant amount of time spent studying. To acquire a charter, each candidate must pass all three tests and have four years of qualifying job knowledge in investment management.

Level I Exam

The CFA Level I test is given in June and December of each year. Its focus is on study utilising the tools from the applicant Body of Knowledge’s ten topic areas. Equity investments, professional and Ethical standards, economics, derivatives, financial analysis and reporting, corporate finance, mathematical techniques, fixed income, portfolio management, alternative investments, and wealth planning are some of the topics covered.

Level II Exam

Only once a year, in the month of June, is the Level II test administered. It stresses the use of investing techniques and concepts in relevant circumstances and focuses on the valuation of diverse assets.

Level III Exam

Only in June, is the Level 3 test conducted. By challenging the applicant to combine all of the concepts and logical methodologies throughout the whole program, its focus is on successful assets planning and portfolio management.

Average Salary of a Chartered Financial Analyst (CFA)

A Chartered Financial Analyst’s average pay is ₹6,82,300 per year (36,960 per month), which is ₹2,94,800 (+76%) more than the national average wage in India. The average starting income for a Chartered Financial Analyst is ₹3,92,500. The top-paid employees can earn up to ₹16 Lakh. The lowest-paid chartered financial analysts are Level 1 Chartered Financial Analysts, whereas the highest-paid chartered financial analysts are Level 3 Chartered Financial Analysts.

Limitations of the CFA Charter

The CFA charter is well-respected, well-known across the world, and a challenging task to complete. It is not, however, a surefire road to wealth and glory. Before you take the leap, think about the disadvantages of getting one. The CFA isn’t a panacea for a sagging career. If you’re registering in the program to amp up a stalled career, you should first look into other possible causes for your stagnation.

Obtaining a CFA charter requires a significant time commitment—at least 300 hours every year for 3 years is recommended—or much extra if you do not pass and opt to retake a test. You’ll probably have to make sacrifices in terms of time with friends and family, along with the chase of activities you like. And even if you put in all that effort, there’s no guarantee that you’ll get the job.

Although money might not be in great distress, this is something to ponder upon. A candidate for Level I will be charged a single time program enrollment fee along with an exam enrollment charge. Levels II and III candidates must also pay a registration fee. You’ll also have to pay for the study programs and books you’ll need. Each time you take the examinations, you should anticipate paying quite a few thousand dollars.

Conclusion 

A chartered financial analyst (CFA) is a worldwide recognised professional qualification granted by the CFA Institute. Candidates must pass three challenging tests, have a bachelor’s degree, and at least four years of relevant experience to become a CFA charter holder. To acquire a charter, each candidate must pass all three tests and have four years of qualifying job experience in investment decision-making. A CFA is a certified investment professional who advises people, firms, and other organisations on investment strategies and portfolio management. Obtaining a CFA charter does not guarantee you a job, but you are more likely to advance in your profession if you have obtained your charter.