If you are someone who has always loved playing with data and numbers to discover fascinating results, the CFA Level 1 course might be the right choice for you. Not sure who a CFA is and what they do for a living? Fret not, we will not only introduce you to this career pathway but will also provide you with a detailed roadmap to become a Chartered Financial Analyst and spend your life doing what you truly enjoy.
If you’re already convinced that CFA is the right course for you, your next step would be to prepare for this course and understand all about its curriculum, examination pattern, the application process, and other related details. Luckily for you, we’ve created a guide that will make your research process easier by giving you all the information you need.
Read on to know all about CFA Course and how you can apply for it.
What is CFA?
CFA or Chartered Financial Analyst is the designation given to students who pass all three levels (level 1, 2, and 3) of the CFA programme. The course covers equity investment, corporate finance, derivatives, financial reporting, and analysis. These competitive exams are conducted and monitored by the CFA Institute. After completing the CFA course, one can work in the corporate sector as an investment manager and a Chartered Financial Analyst.
To appear for the CFA exam, a candidate must have the below-mentioned credentials:
- Should have professional work experience of 4 years (minimum).
- Should have a bachelor’s degree from a recognized university.
- Be a final year student of a bachelor’s program from a recognized institution.
- Have a 4-year combination of professional work experience and education.
What is CFA Level 1?
CFA Level 1 exam is the first of the 3 CFA exams and is held 4 times a year in February, May, August, and November, and is computer-based. You need to complete the registration for Computer-Based Testing (CBT) and then self-schedule your exam. With CBT mode, the total testing time gets reduced to 4.5 hours. The CFA syllabus covers 10 major investment analyses and ethical subjects, giving the student a sound financial knowledge foundation for Levels 2 and 3.
Eligibility of CFA Course
If you want to enrol for the CFA level 1 examination, you must possess a valid international travel passport. This policy creates a single worldwide standard to verify candidates’ identities. You must have a bachelor’s degree from any recognized institute or should be a final-year bachelor’s program student from a recognized institute. Apart from that, you should meet any one of the below-mentioned requirements:
- You should possess professional work experience (4,000 hours), which may or may not be investment-related.
- You should have a combination of 4,000 hours of full-time professional experience and education, which must be obtained prior to enrolment for the CFA level 1 exam.
Course Duration of CFA
The CFA Institute, the exam conducting body, says that on average, an applicant needs at least 4 years to qualify for all three levels of the CFA program. According to the institute, the ideal preparation time is 300+ hours for each of the three levels.
Since the CFA level 1 is the first of 3 levels, it mostly includes introductory topics like investment analysis and ethics, which will help you develop a strong base and prepare you well for the next two levels. The study material is provided by the CFA institute which you can avail of after paying the curriculum fees.
The course curriculum for the CFA level 1 exam is divided into 18 self-study sessions. These sessions also include sample questions. The CFA institute releases 2 sample question papers 12 weeks prior to the CFA level 1 exam. Memorizing specific formulas and calculative features such as square roots, present, and future values, exponents, and annuity payments are highly recommended for performing well in your examinations.
In general, the average starting salary of a CFA is INR 6 to 8 lpa. With enough experience in wealth management and portfolio management, you may also become a Hedge Fund Manager which may help you earn a salary of INR 15 lpa.
There are numerous benefits of becoming a CFA. In addition to working in India, a CFA can also explore multiple opportunities in other countries such as the US, UK, Singapore, Hong Kong and UAE. Indian companies like Motilal Oswal and ICICI Securities as well as international companies like Goldman Sachs, Morgan Stanley and the Big 4 (KPMG, Deloitte, EY and PwC).
|Level of CFA Cleared||Average Salary (in INR)|
|Level 1||4 – 5.4 lpa|
|Level 2||6 lpa|
|Level 3||10+ lpa|
CFA Exam structure
The exam is taken in two sessions consisting of 90 multiple choice questions each. You are provided with 135 minutes for each session along with an optional break between the sessions. The ideal time you should spend on one question is 90 seconds.
You need to pay 450 USD as a CFA enrolment fee at the start of the process. Following enrolment, you must pay an exam fee each time you register to take an exam (levels 1, 2, and 3). The registration fee for each exam is 700 USD.
Books to study CFA
Although the study material provided by the CFA Institute is comprehensive and highly helpful, you can also take help from a few reference books to understand the concepts well. Two well-known books for the CFA level 1 exam are Wiley’s Level 1 CFA Program Study Guide and Kaplan SchweserNotes CFA Prep Book.
Career Scope in CFA
Completed the CFA course but confused where you’d fit in the wider financial world? Don’t worry, companies worldwide value the CFA qualification for the positions and responsibilities they take over in the financial business. Some of these responsibilities include portfolio management, analysis, private wealth, and consultancy.
Let’s take a look at some of the job opportunities you can grab after CFA.
1. Investment Banker
Investment Bankers assist customers in raising capital for their businesses. They also execute different valuation methodologies, provide suggestions for product offerings, private equity deals, and cultivate connections with new and existing clients in order to grow the business and acquire funds, among other things. To generate funds, they need good financial abilities, a thorough understanding of financial principles, and strong sales skills. To operate their businesses, all corporations and organizations require capital. As global markets boost investment levels and baby boomers enter their retirement years, demand for investment bankers is predicted to rise. The average income of an investment banker in India is 9,42,633 INR pa. Furthermore, investment banking specialists are frequently compensated through commissions on the financial products they offer, and success in sales can lead to better pay.
2. Risk Manager
Sounds like an interesting profession, doesn’t it? Well, it truly is, because with great risks, come great benefits. A Risk Manager is responsible for any kind of financial risk situation of a company. Their job responsibilities include regulating and managing the organization’s risk-related factors to evaluate prospective losses. Risk Managers are in charge of running liability programs, collecting risk data, minimizing risks as needed, planning and directing the Risk Management program. Risk Management has traditionally been restricted to finance and insurance. However, events such as the financial crisis, the Covid-19 outbreak, and several business failures have raised awareness about the necessity of risk managers in a company or organization. The average income of a risk manager in India is 1,00,546 INR pa.
3. Portfolio Manager
In an organization, a Portfolio Manager is responsible for managing the fund’s assets, developing and implementing the fund’s investment strategies, managing and controlling day-to-day portfolio, and other management activities. They are also in charge of the fund, whether a closed, open, mutual, hedge, venture capital, or exchange-traded fund. A Portfolio Manager’s annual income in India is 10,23,679 INR pa.
4. Market Research Analyst
A Market Research Analyst monitors and evaluates data from many sources concerning forthcoming and existing market needs for various items to develop conclusions that are then given to the clients. Their job involves exploring several strategies, gathering useful insights, and experimenting with different offers to come up with the one that brings the best results in terms of product sales. With the evolution of technology, the role of a Market Research Analyst has switched from going to places and talking to people in-person to being on their laptops/PCs and finding useful data on the world web. In India, a Market Research Analyst earns 3,37,726 INR pa on average.
The Chartered Financial Analyst is a globally recognised qualification in the field of finance and investment. If you have recently completed your graduation or are appearing for your final semester, you may be eligible to become a CFA. Interested? We highly recommend checking out our Chartered Financial Analyst (CFA) course.
Who has more salary CFA or CA?
In India, the average income of a Chartered Financial Analyst is 6,88,945 INR pa while a Chartered Accountant earns 8,06,154 INR pa. Thus, a CA gets to make more income than a CFA in India in the same organization.
What is the pass rate for the CFA Level 1 exam?
According to the CFA Institute, historical passage percentages for both Levels 1 and 2 have ranged between 40% and 50%.
Can a Data Analyst become a CFA?
Yes, a Data Analyst can become a Chartered Financial Analyst. Fraud detection, risk management, credit allocation, and algorithmic trading are just a few examples of how data science may be used in finance. If you are a pro at data analytics, you can definitely apply your knowledge in financial analysis.