Whether you’re considering a career in finance or already working in the financial services business, earning one of the many finance credentials will provide you with countless benefits, including better job prospects and professional credibility.
And seeing that the finance industry is more competitive than ever, employers and recruiters are looking for a key differentiator in candidates and employees – so it’s vital that you set yourself apart if you’re serious about being successful.
There are some key areas of crossover between designations; for example, much of the Level I CAIA curriculum is referenced in the CFA program. So, whatever your level in CFA, CAIA, FRM or CMT, the chances are you will already understand some of the basic principles involved in many of the others. So why not take that understanding and turn it to your advantage?
This table outlines the similarities between various finance designations to consider as you explore your career in finance.
|What is it?||Considered the gold-standard of finance accreditations, the Certified Financial Analyst (CFA) curriculum covers a broad range of topics and the exams require a notorious amount of focus and dedication to pass.||Directly focused on one of the key areas of the finance industry, the Financial Risk Manager (FRM) Certificate is high-profile and highly respected.||Recognized globally as the key credential for any professional who works in advising and managing alternative investments.||The CMT Program prepares you to manage risk and reward in the portfolio context. From behavioral finance to quantitative systems design and risk management, you will have the perspective and tools to navigate even the most unpredictable markets.||Demonstrates that the holder has met rigorous professional standards and has agreed to adhere to the principles of integrity, objectivity, competence, fairness, confidentiality, professionalism and diligence when dealing with clients.|
|Content||Ethics, Portfolio Management, Accounting, Corporate Finance, Fixed Income, Equity Investments||Quantitative Analysis, Derivatives, Value at Risk, Credit Risk, Operation Risk, Basel Norms||Alpha and Beta Drivers, Real Estate, Hedge Funds, Commodities, Managed Funds, Private Equity, Derivatives, Funds of Funds, Risk Management||Technical Analysis, Chart Development, Markets, Chart Patterns, Candle Pattern Forecasting & Trading Techniques, Risk Management, Technical Investment Strategies, Correlation & Regression, System Design & Testing, Asset Relationships, Portfolio Management, Behavioral Finance, Volatility Analysis||Estate Planning, Retirement Planning, Investment Management, Tax Planning, Employee Benefits, Insurance|
|Organization||The CFA Institute is a not-for-profit organization based in Charlottesville, Virginia. It has over 142,000 members in 159 countries and societies in 73 countries. www.cfainstitute.org||GARP (Global Association of Risk Professionals) is the leading professional association for risk managers. Their mission is to advance the risk profession through education, training, and the promotion of best practices globally.||The Chartered Alternative Investment Association (CAIA) is a global network of more than 8,700 charter holders across more than 80 countries.||The CMT Association is a professional membership association with members in over 137 countries. This mission is to advance the discipline of technical analysis and deliver value through diverse education and networking opportunities, member advocacy and career advancement.||The CFP Board is a non-profit organization acting in the public interest by fostering professional standards in personal financial planning through its setting and enforcement of the education, examination, experience, ethics and other requirements for CFP® certification.|
|Exam Structure||Level I, Level II and Level III||Part I and Part II||Level I and Level II||Level I, Level II and Level III||The exam is a 170-question multiple-choice computer-based exam over 7 hours|
|Fees||Program Enrollment Fee: $450 Registration Fee for each Level. Standard: $950 Late: $1,380||Standard: $475 Late: $650||Program Enrollment: $400 Level I: $1250 Level II: $1250||Program Enrollment Fee: $250
Registration fee vary per level and deadline. Level I: $275; $375; $575 Level II: $475; $575; $875 Level III: $475; $575; $875
|Exam: $850 Exam & Practice Exam: $1025|
|Exam Windows||Level I – 1st Saturday in June and 1st Saturday in December. Level II – 1st Saturday in June. Level III – 1st Saturday in June.||Two testing windows: May & November.||Two testing windows: March and September.||Two testing windows: April and October||Three testing windows: March, July and November|
|Topic areas||Level I focuses on investment tools and tests your basic knowledge and comprehension with some questions requiring analysis.||Part I is a 100-question multiple-choice exam that focuses on the tools used to assess financial risk: quantitative analysis, fundamental risk management concepts, financial markets and products, and valuation and risk models.||Level I focuses on candidates’ understanding of various alternative asset classes and tests their ability to utilize the methods used to evaluate the risk-return attributes of each one.||Level I focuses on definitions, concepts and terminology around technical analysis.||The CFP exam focuses on Risk Analysis and Insurance Planning, Retirement Planning & Employee Benefits, Investment Planning, Tax Planning & Estate Planning|
|Level II requires more complex analytical skills and a focus on valuing assets.||Part II is an 80-question multiple-choice exam emphasizing the application of the tools acquired in Part I: market, credit, operational, integrated risk, and investment management, as well as current market issues.||Level II asks you to apply your understanding gained in Level I within a portfolio-management context.||Level II requires applications of theories and concepts explored in Level I.|
|Level III requires you to apply concepts and analytical methods during essays and includes questions on effective portfolio management and wealth planning.||Level III looks more in-depth at certain areas such as ethics. Also it asks candidates to apply their practical skills by analyzing case studies and making recommendations.|
|Pass Rates or Scores||Level I: 43% Level II: 47% Level III: 54%||Part I: May: 44.5% November: 44.8%
Part II: May: 50.1% November: 54.3%
|Level I: 60% Level II: 57%||Average pass rates, over the last four administrations (two years):
Level I: 61.8% Level II: 54.0% Level III 77.3%
|CFP Exam: 64%|
|Requirements||An international travel passport (read the ID policy) and one of the following:||Anyone can take the FRM exams.||A bachelor’s degree and at least one year of experience.||The exam is open to anyone with an interest in technical analysis. To earn the designation candidates must have at least 3 years professional work experience in a relevant field.||A bachelor’s degree and completion of specific CFP coursework. (Can be waived if the candidate holds another relevant professional designation.)|
|A bachelor’s (or equivalent) degree, or be in the final year of your bachelor’s degree program, or||A bachelor’s degree.|
|Four years of professional work experience (does not have to be investment related), or|
|Four years of professional work experience and education directly prior to enrollment.|
|Top Occupations||Top occupations include: Portfolio Manager, Research Analyst, Chief-Level Executive, Consultant, Risk Manager, Corporate Financial Analyst, Relationship Manager, Financial Advisor||Banking, Asset Liability Management, Treasury, Risk Appraisal, Financial Analyst, Research Analyst, Risk Manager, Chief Risk Officer, Chief Compliance Officer||Portfolio Management, Financial Analyst, Business Development, Asset Allocator, Consultant, Risk Management, Due Diligence Compliance/Legal, Accounting/Fund Administration||Portfolio Manager, Research Analyst, Investment Advisor, Hedge Fund Manager, Financial Advisor, Asset manager, Chief Investment Officer, Investment Strategist||Retirement Planner, Estate Planner, Financial Manager, Risk Manager|
|Time Commitment||300 Hours per Level||150 Hours per Part||200 Hours per Level||100 Hours for Level I, 140 Hours for Level II, 160 Hours for Level III||200 Hours|
|Value Add||The CFA Institute says it is the Gold Standard. The CFA charter equips you not only to enter the profession, but to excel. It connects you with a prestigious network of outstanding investment professionals.||GARP says membership provides the community with engagement opportunities allowing them to have a voice in industry research, unparalleled networking opportunities, access to risk intelligence, and much, much more. GARP has 28 Chapter Directors representing 20 Chapters in more than a dozen countries.||The CAIA Association says: In the competitive alts landscape, mastery of the broad array of asset classes and the strategies and practices surrounding them is essential. By registering for the CAIA exam, you take a major step in your alternative investment education—and your career.||The CMT Association says: Earning the CMT demonstrates mastery of a core body of knowledge of investment risk in portfolio management. Our market philosophy is grounded in behavioral economics and extends beyond classical pattern recognition techniques to include quantitative approaches to market research and rules-based trading system design and testing.||The CFP Board says: Although many professionals may call themselves “financial planners,” CFP® professionals have completed extensive training and experience requirements and are held to rigorous ethical standards. They understand the complexities of the changing financial climate and know how to make recommendations in your best interest.|
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