Haters will hate! My view about CFA...

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Micholien

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I came across the level II results thread and was shocked by how many people have been at their 3rd attempts or more.
I will say the following; while I admire (truly admire) your drive and commitment and even felt somewhat happy when i read about that guy that passed in the 7th attempt, I find it kind of ridiculous. I mean this is level 2 only so i am sure some of them have also missed level 1 and may also miss level 3. Dont you find it ridiculous that you have been in this for already 4+ years (minimum 1 level 1 and 3 level 2) and are not even done yet. Like you will have sacrificed a minimum of 5 +years studying this shit.
The most ridiculous is when on top of that people are doing it to join an industry they dont even know basically because they re not in it. I mean you dont even know if you are gonna like it and you are making yourself miserable for 5+ years to do something that might even find miserable (that is if that charter even gets you in). I think for those not in the industry, you guys should do an MBA instead and intern one summer at at investment firm and see at least if you like and then maybe pursue the charter. Or you should before taking another level actually do the job and start researching companies and write investment pieces, that way you can see if you can do the job, if you like it and also recruiter will prefer that to a no investment related experience candidate having passed any level but having nothing to show for it.
Now for the outrageous #s of attempts (3 or more per exam i think), here is why I think this is insane. I am from france and i am going to compare that to our medical school system. In France after high school you join med school and after the first crazy intense year of study there is a big exam that is curved and only about 15% of people pass and get to pursue their medical career (surgeon, doctors or dentist). If you miss that exam you can reatke it the next year but if you fail again you are done!! You will not become a doctor…. (actually you can take it again 5 years later or so I believe). I think this is a very efficient system because while it crushes some people dreams, it also helps you decide that this may not be for you and also (maybe not a 100% guarantee) that the most driven/and smart combo will go further (always this does not always guarantee they ll be the best doctors but its like everything else). Would you not prefer having the best doctors taking care of you or at least the prospects that the best students those with most potential were given the chance?
I think the same way about the CFA. Would you not rather have the people with the most potential manage you your money in the future. I am sorry and I am sure there is a lot of smart people who fail this test but then it means they have not worked hard and so do I like that or do I want my money in someone like that hands? NO! I think the CFA to keep its prestige and its relevance should have some kind of rules around its #s of takes. Whatever it is whether is one miss allowed per attempts or 2 misses allowed overall, you shoudlnt be able to obtain your charter 6 or 10 years after having started (that is if it is due to exam fails) because I think anyone could at some point pass an exam by repeating the same thing over and over; I mean COME ON! that means this shit is just not for you; whether you dont get it or not study hard either way this is not for you!
Now Haters can Hate; this is just my 2 cents!
 
I forgot one thing regarding what I think the CFA should do. If not for limiting attempts, I believe then it should allow employers to see how many times ones took the exam (but I like that a lot less because lets say one that fails once will then look worse but dont think that it means much but one that fails >3 times total I am starting to question it).
 
Now that I passed Level II, I think they should make it harder :)…..
 
CFAI can keep lowering the pass rate to control the amount of people it progresses to the next level. If someone fails 5x and then passes it means they put in the required effort to succeed, and passed alongside someone who took the exam for the first attempt. There’s no requirement on speed of the exams, if it takes 20 years it takes 20 years, but that person is just as qualified as someone that did all 3 exams in 1 shot.
Also CFAI can bring in more money by allowing an unlimited number of takes. and how many people do you know took 3+ attempts? very few.
look at it this way. you can state without violating that you passed all three levels in one shot. Employers do ask how many attempts you take on each level and it does impress them when you say you’ve passed both L1 and L2 in one shot. employers can ask how long you’ve had your charter, when you got it and can piece together from that if it took you a long time etc, they don’t need CFAI to cut someone off to tell them they aren’t the top tier.
 
I understand how you feel. However, do not forget that many people simply don’t have time to study.
 
Your thinking is too French. We Americans believe in the underdog, the land of opportunity, the fighter who comes back up after being beaten down, the guy who never gives up and keeps trying.
Besides, can you really say that a person working 8 hour days who passed a CFA exam on first try “worked harder” than another person working 16 hour days who passed the CFA exam after two tries? Or compare with someone with a family and young kids?
“Would you not rather have the people with the most potential manage you your money in the future.”
Look at the average performance (raw or return / risk, take your pick) of hedge funds and the mutual funds, pretty much par with the market. One of the best mutual fund recently was a one person shop run by a Chinese guy (PhD in some bio related field) living in California, with no MBA or finance training whatsoever, who decided to turn his investing hobby into a career.
Don’t get too enamoured by what you learn in the CFA. Yes, it’s a good body of knowledge to have, but it doesn’t really make you a good investor.
 
I appreciate your views and the time you took out to put in your post. I agree with your suggestion that an MBA + Finance job internship is possibly the best way to go for ‘outsiders’ who are trying to gain a foothold in this industry. Substituting the CFA exams instead of the MBA maybe cost effective, but it won’t achieve the desired results as expected for everyone who attempts such a thing.
Nevertheless, not many people take the CFA exam and proceed to work for the charter just to increase their chances to get into the finance industry. Everyone’s objectives can be different. Even ‘outsiders’ can use the CFA to gain knowledge about the industry and basics of finance. If you take the learning angle into consideration, MBA is too expensive for that. Also, I have seen so many people drop out of the program after trying once or twice. Only serious contenders stay put and don’t lose hope if a setback occurs in the CFA journey. Surely these people know what they are doing. I would encourage that.
And like EddieChen said above, many working professionals simply don’t have the time to study because of the difficult economy where work (and of course) family comes before most things. People in the finance industry are extremely stressed out at work and that is one reason that one can find many people in this industry too not clearing exams.
 
westlake wrote:
Your thinking is too French. We Americans believe in the underdog, the land of opportunity, the fighter who comes back up after being beaten down, the guy who never gives up and keeps trying.
Besides, can you really say that a person working 8 hour days who passed a CFA exam on first try “worked harder” than another person working 16 hour days who passed the CFA exam after two tries? Or compare with someone with a family and young kids?
“Would you not rather have the people with the most potential manage you your money in the future.”
Look at the average performance (raw or return / risk, take your pick) of hedge funds and the mutual funds, pretty much par with the market. One of the best mutual fund recently was a one person shop run by a Chinese guy (PhD in some bio related field) living in California, with no MBA or finance training whatsoever, who decided to turn his investing hobby into a career.
Don’t get too enamoured by what you learn in the CFA. Yes, it’s a good body of knowledge to have, but it doesn’t really make you a good investor.
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You make a good point westlake and I agree with your rationale (except my french thinking ;) ) but i guess my argument goes far beyong what I wrote and trying to write only the main points didnt really establish my thoughts perfectly.
I dont believe cfa gonna make you a greater investor by itself, I believe to be good it goes way beyond the charter which remain like any other texbook way too theoritical but provide great tools to get better tho. I just think for both cfa charters and for these porr people spending 3+ years to clear a third of the exam, a limit would benefit both. The charter has already become a lot less meaningful and will continue to be less. For people taking it thinking thats their ticket to a better life in the buy/sell side of finance and think that its worth 5 6 or more years of sacrifice its absurd. Then Again I agree that there are exceptions to the rule and people not having time (then dont take it until you have more time and focus on your work and family for now) or people just really passionate and maybe already in the field that still cant pass for x or y reasons (bad test takers or some stupid shit).
However it remains that with a different policy on #s of attempt or disclosure to employer on #s of attempts it took (which i rmeind you you can lie about there is noways for them to verify due to privacy and CFA has said that they dont consider attempts and score to matter so they wont release it), it will help people who fail multiple times and basically force them out of the program, a decision they might struggle to take themselves because they know they eventually gonna get it.
 
By the charter being less meaningful ==> look at the #s of job that requires the charter today. People get fooled that if you get the CFA you will get the job because its required; the reality is a lot of jobs now requires that charter more ebcause there are so many CFAs today that they know they can ask that as a requirement and still have numerous competitive CFAs applicants ==> the ultimate decisions then is made on the rest of your resume and past experience investment experience and then the CFA in that case just got you the interview but reality is you are still far behind in terms of the rest of their needs!
 
Micholien,
France is missing out on some great doctors because they failed the test twice.
I used to be the “topper” in every exam (no bragging) but I could see my classmates who studied harder with all their heart and got less GPA than me, were in reality better in my field than I was. Exams are only 10% of the story, choosing based on exams is a lazy system designed to lessen the headaches for administrators. This goes for CFA, GMAT, GRE, AGRE, etc but for all except CFA, the admissions process can also consider coursework.
And now I have a lot of work experience and lead people, I can see that those who are passionate and hardworking are better at their jobs than the “flash-in-the-pan” good exam-takers (including me, but I’ve improved). Someone who tried 5 times and passed probably has a better understanding of the curriculum.
I’d feel quite confident placing my money in the hands of someone who passed CFA after multiple attempts. as long as they conformed to my idea of an ideal money manager. Puts my interests first, works hard, checks and rechecks his assumptions and research, etc. I am more weary of the high IQ braggarts who would think of me as just another muppet.
 
CFA,Degrees,certificates may open doors at the best of times… but one still has to walk through them , which is where real hardship lies and most fail (including me). Using CFA exams as a barometer of potential investment success is a silly administrative convenience adopted by the finance industry for marketing purposes. Once you have done a level of CFA, in my opinion, you should be in no doubt that the only thing the cfa programme is, is a standard collection of references to processes and theories that for the most part have been proven not to work, or only work under very constrained conditions that do not mimic reality to warrant direct application. So once you have passed the three levels of the CFA, you would have proven your dedication to the field but not necessarily your passion, your ability to memorise material and pass exams but not necessarily your ability to generate abnormal returns.The cfa , like other certificates and degrees are just like driving licenses, it may allow you to operate a vehicle but you may not be any good at it.
 
CFA is like an ornament - its not a mandate. Its an ornament which can be bought if you put in XXXX hours of hardwork. So there is absolutely no harm in allow people to repeat.
We should not compare CFA and MBA - MBA is a degree and hence has this limitations of # years to complete etc. CFA is a certificate (or similar to it), people who wish to write can write it as long as they clear it. The CFAI doesnt clear you because you are writing it for 7th time or 3rd time. The same standard applies irrespective of # times you try.
IMHO, I am happy the way CFA tests are (after being enlightened by USJ2 and his friends in another thread on why some things cannot be done by CFA)! And I read somewhere that there are people who failed the exam in Band 10 consecutive years. The only difference between me who is a pass and he/she who is a fail - is probably 1-3 questions. I have no shame in saying that if I wrote the test on a different day, that person in band 10 could be in my shoes and I could be in his/her shoes.
 
Well I too, am French, and whilst I see Micholien’s point, I doubt that the ability to sit the CFA and clear all levels on the first attempt implies that you’ll fare better than those who fail once (that said, I cleared level 1 and 2 on first attempt). How many of us all can still remember all of what’s been learned from level 1 and 2? Isn’t it short term memory we use? I can fairly say that most of what I’ve learned, I’ve learned by cramming…
“Culture is what remains once you’ve forgotten everything”… I think that the saying unfortunately applies to the CFA curriculum. I mean I do use some of the material, but who can say - aside those who work for the CFA institute - they use all or most of it?
 
mad’moiselle wrote:
Well I too, am French, and whilst I see Micholien’s point, I doubt that the ability to sit the CFA and clear all levels on the first attempt implies that you’ll fare better than those who fail once (that said, I cleared level 1 and 2 on first attempt). How many of us all can still remember all of what’s been learned from level 1 and 2? Isn’t it short term memory we use? I can fairly say that most of what I’ve learned, I’ve learned by cramming…
“Culture is what remains once you’ve forgotten everything”… I think that the saying unfortunately applies to the CFA curriculum. I mean I do use some of the material, but who can say - aside those who work for the CFA institute - they use all or most of it?
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+1
 
KoolSIM wrote:
Nevertheless, not many people take the CFA exam and proceed to work for the charter just to increase their chances to get into the finance industry.
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You are wrong. Have you seen the poll results on CFAI website? There are MANY people trying to use the CFA exams to get into the finance industry.
 
iteracom wrote:
KoolSIM wrote:
Nevertheless, not many people take the CFA exam and proceed to work for the charter just to increase their chances to get into the finance industry.
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You are wrong. Have you seen the poll results on CFAI website? There are MANY people trying to use the CFA exams to get into the finance industry.
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+1. I am one among them. Ive 10 years in IT and 2+ years servicing CT scanners/MRI machines/Ultrasound scanners and Xray machines :)
But Ive got a few networks who believe in me and can help me get into the industry. Well am hoping it does help me, if it doesnt not a problem - Ive learnt something new and will move to get to another industry. Well, I might even open a centre for CFA studies :P
 
some very good arguments are being made here from both sides and there is not much i can add to it. Just throwing a question to Micholien. My brother cleared level all three levels the first time of asking after putting in no less than 1000 hours of studying in each level (and these are very conservative figures) and he barely scraped through each level. I know a friend of his who had identical scores in all the subjects but somehow failed (band 10) after putting up less than 100 hours of studying in level 3 last year. Add the fact that my brother has never been employed by a financial institution unlike his friend who has 5 years of handson experience. who would you rather have to be your money manager? My brother or his friend?
 
Comparing CFA to Med School is absurd. I take my job seriously but I know I’m not saving lives.
I do not care if the person who can earn me 25% / year took 50 years to pass the CFA or does not even have one at all. Frankly, I take exception to those ppl who brag about 1st attempt passing or only needing one week to study. I would steer clear from them managing my money and definitely not hire them.
The world has plenty of bookworm nerds. Don’t need any more. Frankly, we need a level 4 personality exam IMO.
 
Why are there so many tree lined streets and leafy lanes in France? The Germans like to march in the shade.
I saw a beautiful French rifle the other day. Never fired and it was only dropped once.
Look at the AF motto and lose the attitude pal.
 
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