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CFA vs basic MBA.

I must apologizes in beforehand. I know this subject is probably discussed thoroughly.

But I’d like to hear fellow AF’s opinions regarding CFA and basic MBA. And with basic MBA, I mean MBA from a basic school (not IVY or top-notch European schools like HEC, LSE, ESSEC or INSEAD etc).  

I feel as MBA is becoming more and more watered down when it comes to quality of education (and so it CFA by the sheer number of candidates earning the charter every year btw). MBAs are just everywhere nowadays and it’s hard to tell if the person actually has a real MBA or “MBA” and how much they actually know about business or finance. This past month I met with Swedish “MBA” who wasn’t able to tell the difference between floating-rate and fixed-rate debt…it was rather shocking.

So my questions is directed to AFers in managing/hiring positions…is MBA still respected? Do employers look deeply into the potential employees educational background in order to determine whether they are competent or not? What do employers think when they see that the applicant has a MBA from a never-heard-of school?

It ain't what you don't know that gets you in trouble. It's what you know for sure that just ain't so.

" Wiley's prep material was a huge part of my success." - Lindsey G., USA

It depends…

Financial Planner
BBA (Finance & International Business) 1998,
MBA (With a Global Perspective) 2011,
ChFC 2018, Completed CLU program 11/30/18
Owns an Independent RIA/Insurance Agency
Series 65, Life, Annuities, Health (Expired 6,63)

My view is if you are working in financial services then CFA. MBA is good but not if you are self funding. I worked in a big investment bank and the senior directors where of the opinion if it was not a top 5 institution internationally then it was not a meanfiul MBA but they did value CFA. 

I have worked with colleagues who have a MBA from one of the top 5 schools and have been absolutely useless but regardless it has opened a lot of doors for them.

The other versions just dont have the same impact. Worked in another place where around 30% of people had MBAs from a less well known institution (since it was paid for by the company) and no one ever got head hunted, surprising considering the pay was pretty low and they didn’t even offer a pay rise for finishing. 

I personally don’t know anyone that started an MBA and did not finish…….CFA on the other hand…….

I would say it really depends. I have done my MBA from the Ivey Business School (part of University of Western Ontario) and in Canada that is the most prestigious school there is. It has value. I used to get interviews because of that school name just. But I am also doing my CFA mainly because I feel that while the MBA opened doors and has gotten people interested in hiring me, the CFA will prove that I am not just the regular bloke who does a Bachelors, works, does a MBA, and then believes themselves to be entitled. I also always say that I am committed to lifelong learning, so what better way to prove it then to continuously upgrade your skills?

Now why I said it depends is because the school is everything. The last place I was working, I was helping in choosing potential candidates for a role and I was surprised at the criteria for school. The name means a lot because it tells you the type of education the person got. So, for example, a particular school’s MBA was marked as “do not consider”. I won’t name the school because I didn’t agree with the HR team, but basically anyone who had a MBA from that school was immediately discarded no matter how great their experience. When I asked HR why, they explained that this school skipped over basic finance skills that are important to the role.

That’s one depends. But the other one, and the more important one, is ranking against the competition. Let’s say A has a MBA from Harvard, 3 years of experience working at an investment firm based in the US, and believes that he/she is entitled to be promoted to a senior level already because of the MBA (I’m not joking when I say that I’ve seen this). Let’s say B has a MBA from some online school, a CPA, 6 years of experience in Deloitte in their Vancouver office, and now wants to transition into the finance industry and so is planning to register for CFA. Who would you hire for a role in investment banking associate role? Yeah B might have completed the MBA from some watered down school, but he/she is showing that they want to learn. They’ve done a CPA. They’re ready to do a CFA. Does it really matter where they did their MBA from then?

My point is that yes MBA is becoming watered down and very popular. It’s like every other person now has a MBA. But it should all come down to the experience around that MBA. If someone has a prestigious MBA that doesn’t make them the best candidate to hire and if someone has a MBA from an unknown university that shouldn’t automatically exclude them from the role. And as my mentor once said to me: “It’s not about getting those 3 letters after your name, but about what you want to do? Do you want to keep learning and taking on tough programs or do you just want to relax now that you’re through regular school? It all depends on you.”

Bachelors of Business Administration (BBA), Masters of Business Administration (MBA)
"People grow through experience if they meet life honestly and courageously. This is how character is built." Eleanor Roosevelt

I am toying with the idea of doing an MBA but I agree that the school rep is crucial. 

I think the MBA is really nicely  geared for career transitions and stepping into high level C-suite / Directorship roles. It’s about management and leadership skill building, with some detailed finance electives along the way.

In terms of skill set, CFA and MBA is a killer combo (up there with CFA/ACA (Or in US CPA). CFA builds the bottom up technical details and miniutia. Details details details. MBA is the other way around, coming in from a high level and building real life practical skills necessary to excel in management roles. I believe the two together is an incredibly powerful combo.

MBA’s are watered down because of all the online ones and plethora of schools offering this and that. Therefore, getting a solid GMAT score (700+) and working towards getting into a top ranked school should be the main game if you are going to spend the money to go down this route, so I would not put the effort in unless you are relatively certain you can get at least a top 20-30 world ranked school. 

There are some schools which may not be as good but still have rich history which I would probably look at. Take Cambridge or Oxford in UK - neither of these schools is an amazing MBA college (they are famous for mathematics / sciences and literature) but the names of these schools are iconic and I believe would still hold weight (notable alumni) despite not being famed for their Finance expertise.

.....woof

People denounce MBA degrees by saying they are “a dime a dozen” these days.  I find that as a funny criticism because if that’s the case, I sure wouldn’t want to be left without one…

I didn’t say it was “dime a dozen”, I said it was becoming watered down. When my aunt did her MBA almost 20 years ago there were really just 2 types of schools: top-notch and not-top-notch. Not every school offered MBA and there sure wasn’t anything like an online MBA. Today almost every university with a business program of some kind has a MBA and there are online MBAs. Heck after I finished my MBA I got invited to take part in about 20 different online MBAs costing between $2,000 and $10,000 CAD that ran for a few months only. That’s why I say watered down.

Also different countries have different requirements for completing MBA which doesn’t really make it comparable. For example, in some countries you can do a MBA right after your Bachelors. But in the case of the CFA, it is the same standards and requirements everywhere so it makes it more comparable.

I would be the last person to denounce the MBA degree given that I hold one.

Bachelors of Business Administration (BBA), Masters of Business Administration (MBA)
"People grow through experience if they meet life honestly and courageously. This is how character is built." Eleanor Roosevelt

There’s a story in the FT today about a financial director enrolling in an MBA program in his 60s.  Google it if you’re interested.

If you’re looking for connections and to improve your CV, it seems obvious to me that you should obtain an MBA from a reputable school.  If you’re just interested in the curriculum - you could consider an online course - or just read some textbooks - you should be used to self-study by now.

My statement was not in response to you.  It was a general statement about the sentiment I have been seeing lately.  I agree with what you said.

Okay I don’t know why I just felt it was directed at me. :)

Bachelors of Business Administration (BBA), Masters of Business Administration (MBA)
"People grow through experience if they meet life honestly and courageously. This is how character is built." Eleanor Roosevelt

USAHighlander wrote:

People denounce MBA degrees by saying they are “a dime a dozen” these days.  I find that as a funny criticism because if that’s the case, I sure wouldn’t want to be left without one…

good one!

I like how you think.

hence, i got both mba and cfa haha

Be yourself. The world worships the original.

The two are not comparable.

The average number of years it takes a CFA Charterholder to receive the charter is 4 years (CFAI statistics) - I know people spent 7 years on this!

However it is probably 2 years for the MBA. (Masters of finance or so is even less)

In the FT today: Business education: have we reached peak MBA?

https://www.ft.com/content/d8ec7cd6-d153-11e8-a9f2-7574db66bcd5

cfapasss wrote:

The two are not comparable.

The average number of years it takes a CFA Charterholder to receive the charter is 4 years (CFAI statistics) - I know people spent 7 years on this!

However it is probably 2 years for the MBA. (Masters of finance or so is even less)

LOL 7 years!!!! by that concept maybe CFA is more prestigious than doctors and certainly lawyers!! hahaha.

Let Me Ask You This…What can a person with a CFA charter do that a non CFA charter cannot do????

You know in the legal world, you need a law degree and pass the bar exam to do any legal work….Even in accounting, CPA are the only ones who can sign off on company audits, 10ks, tax returns etc……You can’t just go to the local library and read 18 books on brain surgery and take a few exams with 40% pass rates and operate on a person…you need to take the MCAT, 4 years of med school, residency, board exams, then and only can you do anything with your medical degree….

CFA?? anyone can take it and pass rates hover around 40% on a 3 choice multiple choice exam lol.

Be yourself. The world worships the original.

infinitybenzo wrote:

cfapasss wrote:

The two are not comparable.

The average number of years it takes a CFA Charterholder to receive the charter is 4 years (CFAI statistics) - I know people spent 7 years on this!

However it is probably 2 years for the MBA. (Masters of finance or so is even less)

LOL 7 years!!!! by that concept maybe CFA is more prestigious than doctors and certainly lawyers!! hahaha.

Let Me Ask You This…What can a person with a CFA charter do that a non CFA charter cannot do????

You know in the legal world, you need a law degree and pass the bar exam to do any legal work….Even in accounting, CPA are the only ones who can sign off on company audits, 10ks, tax returns etc……You can’t just go to the local library and read 18 books on brain surgery and take a few exams with 40% pass rates and operate on a person…you need to take the MCAT, 4 years of med school, residency, board exams, then and only can you do anything with your medical degree….

CFA?? anyone can take it and pass rates hover around 40% on a 3 choice multiple choice exam lol.

infinitybenzo

I gave you statistics..you uttered BS

The malfunction in your brain system is obvious. I highly recommend an immediate mental checkup.

cfapasss wrote:

infinitybenzo wrote:

cfapasss wrote:

The two are not comparable.

The average number of years it takes a CFA Charterholder to receive the charter is 4 years (CFAI statistics) - I know people spent 7 years on this!

However it is probably 2 years for the MBA. (Masters of finance or so is even less)

LOL 7 years!!!! by that concept maybe CFA is more prestigious than doctors and certainly lawyers!! hahaha.

Let Me Ask You This…What can a person with a CFA charter do that a non CFA charter cannot do????

You know in the legal world, you need a law degree and pass the bar exam to do any legal work….Even in accounting, CPA are the only ones who can sign off on company audits, 10ks, tax returns etc……You can’t just go to the local library and read 18 books on brain surgery and take a few exams with 40% pass rates and operate on a person…you need to take the MCAT, 4 years of med school, residency, board exams, then and only can you do anything with your medical degree….

CFA?? anyone can take it and pass rates hover around 40% on a 3 choice multiple choice exam lol.

infinitybenzo

I gave you statistics..you uttered BS

The malfunction in your brain system is obvious. I highly recommend an immediate mental checkup.

Actually, everything you said and I said are true…Neither of us uttered BS. Your “stats” are true and my stat are true as well….

wait…are you the one who uttered the BS, “CFA is one of the hardest exams to pass” on one of the threads here on AF?? hahahaha….so 40% average pass rate on multiple choice exam is one of the hardest exams? mmm kay….

Be yourself. The world worships the original.

Please note there are 3 types of MBAs.

1. MBA from a top 10 school.

2. MBA from an ok school.

3. MBA from a crappy school nobody cares about.

CFA is better than #2 and #3.   The real debate is CFA vs. a top 10 MBA program.

at this point I think the CFA is better than #1.   #1 is good for networking, and getting recruited into an internship, etc.

but obviously the CFA material is much harder than the MBA ( finance concentration) programs.

Trader609 wrote:

Please note there are 3 types of MBAs.

1. MBA from a top 10 school.

2. MBA from an ok school.

3. MBA from a crappy school nobody cares about.

CFA is better than #2 and #3.   The real debate is CFA vs. a top 10 MBA program.

at this point I think the CFA is better than #1.   #1 is good for networking, and getting recruited into an internship, etc.

but obviously the CFA material is much harder than the MBA ( finance concentration) programs.

as much as I think the CFA program helps your prospects, etc…I’m not convinced that it is “better” than HBS, Booth or a Wharton.  The fact is we will never really know, but the average opportunity coming out of those school are probably better than the average CFA charter opportunity.  At least I’m willing to bet.

Not to mention that someone graduating from one of those also has the opportunity to get their CFA charter.  Can’t say the same for a charterholder who gets denied from one of those schools…

Trader609 wrote:

Please note there are 3 types of MBAs.

1. MBA from a top 10 school.

2. MBA from an ok school.

3. MBA from a crappy school nobody cares about.

CFA is better than #2 and #3.   The real debate is CFA vs. a top 10 MBA program.

at this point I think the CFA is better than #1.   #1 is good for networking, and getting recruited into an internship, etc.

but obviously the CFA material is much harder than the MBA ( finance concentration) programs.

El Oh El

Oh yeah for sure mang!!!! Getting the CFA charter is much more difficult than getting an MBA from Harvard because,

HBS students have an average GMAT score of 94th percentile and have undergrad GPA higher than 3.4 along with quite successful corporate ladder climbing experience along with extra curricular activities.

CFA on the other hand, anyone with undergrad can sign up and self study to take the CRAZY LOW 40% pass rate multiple choice exam!! Network? pfff who needs that when you just passed a 6 hour exam at some convention center along with 767 IT and BO Indians? AND CFA is so much cheaper and upon passing you get a personal visit from CEOs of Goldmanng and JP Murgan to help them turnaround their active mgmt business.

Be yourself. The world worships the original.

infinitybenzo wrote:

Trader609 wrote:

Please note there are 3 types of MBAs.

1. MBA from a top 10 school.

2. MBA from an ok school.

3. MBA from a crappy school nobody cares about.

CFA is better than #2 and #3.   The real debate is CFA vs. a top 10 MBA program.

at this point I think the CFA is better than #1.   #1 is good for networking, and getting recruited into an internship, etc.

but obviously the CFA material is much harder than the MBA ( finance concentration) programs.

El Oh El

Oh yeah for sure mang!!!! Getting the CFA charter is much more difficult than getting an MBA from Harvard because,

HBS students have an average GMAT score of 94th percentile and have undergrad GPA higher than 3.4 along with quite successful corporate ladder climbing experience along with extra curricular activities.

CFA on the other hand, anyone with undergrad can sign up and self study to take the CRAZY LOW 40% pass rate multiple choice exam!! Network? pfff who needs that when you just passed a 6 hour exam at some convention center along with 767 IT and BO Indians? AND CFA is so much cheaper and upon passing you get a personal visit from CEOs of Goldmanng and JP Murgan to help them turnaround their active mgmt business.

You’re barking at the wrong tree. Trader609 was talking about pure financial toolbox coming out of a top 10 MBA program vs. CFA. Obviously, a guy with a Harvard MBA has better career prospects than the average charterholder, but that doesn’t mean that the finance curriculum at Harvard is more difficult than the CFA program. 

If you're the first out the door, that's not called panicking

I live and work in Europe. Here`s what I understand so far.

If you live in the US, the CFA is pretty well established and recognised so a good step forward. Besides, the US has very well developed capital markets so more opportunities I guess. Perhaps US forum mates would share an opinion btu I think it will be higher prized than a low-mid uni MBA.

If you live in Europe, definitely an MBA. Several of my former classmates work in large banks and they all say the same - on interviews (bank Directors are mostly from Western Europe) they`d take a candidate with a finance degree from a local university (they`re sub 1, 000 rank in the QS Global Rankings) anytime over a CFA. This indeed shook my motivation to pursue the CFA charter and I will probably go for a different education path. Besides, capital markets in continental Europe are not that much expanded as in the US and in the UK you have the CISI which my UK friends claim is preferred by employers.

Scanspeak wrote:

I live and work in Europe. Here`s what I understand so far.

If you live in the US, the CFA is pretty well established and recognised so a good step forward. Besides, the US has very well developed capital markets so more opportunities I guess. Perhaps US forum mates would share an opinion btu I think it will be higher prized than a low-mid uni MBA.

If you live in Europe, definitely an MBA. Several of my former classmates work in large banks and they all say the same - on interviews (bank Directors are mostly from Western Europe) they`d take a candidate with a finance degree from a local university (they`re sub 1, 000 rank in the QS Global Rankings) anytime over a CFA. This indeed shook my motivation to pursue the CFA charter and I will probably go for a different education path. Besides, capital markets in continental Europe are not that much expanded as in the US and in the UK you have the CISI which my UK friends claim is preferred by employers.

From pure finance knowledge perspective, I’d say that CFA beats pretty much any MBA program. MBA programs’ focus is much broader than the CFA curriculum and its focus is not directly on finance knowledge. In my opinion, having a mediocre MBA or  being a Chaterholder usually gets you an interview in Europe. After that, it depends on the position. From my own perspective, CFA (L3 candidate) has been way more helpful than my MBA. In the interviews I’ve been in, I’ve usually gotten a few pretty difficult questions relating to technical finance stuff (derivatives valuation, quant stuff), which I could not have not answered if I had not been in the CFA program. 

If you're the first out the door, that's not called panicking