CFA pass rate article

Jan. 28 (Bloomberg) – A smaller percentage of candidates passed the first test of the Chartered Financial Analyst exam, a three-step process aimed at gaining a hiring edge as job losses accelerate in the financial-services industry. Thirty-five percent passed the initial test, down from 39 percent last year, the CFA Institute said in a statement today. Almost 50,000 people worldwide took the first stage in December, a 25 percent increase from a year earlier, the Charlottesville, Virginia-based institute said. “The number of hours candidates spent studying the material” is the main reason the percentage of people who pass varies, Bob Johnson, the institute’s deputy chief executive officer, said in an e-mail. Candidates take the exam betting the certification can become a path to better jobs, higher salaries and a deeper understanding of finance. The not-for-profit CFA Institute recommends candidates spend at least 250 hours studying for each test phase. It costs about $2,500 to complete all three levels. Demand for the certification rose as job losses mounted in the financial-services industry. Employment in New York City’s securities industry fell 10 percent to 168,600 in December from 187,800 in October 2007, the New York state comptroller said in a report today. The state will have lost as many as 225,000 jobs and $6.5 billion in securities industry-related tax revenue by Oct. 31, the state has said. Test Topics To qualify for CFA designation, a person must be employed in a financial job, such as a broker or an analyst, and have four years of relevant experience. Topics range from ethical standards and securities valuation to financial statement analysis and portfolio management. About 20 percent of candidates who begin the test process will become charter holders, a designation now held by 86,968 people, according to the CFA. About two-thirds who take Level III successfully complete the process. The CFA program started in 1963 and stems in part from proposals by Benjamin Graham, a pioneer of value investing who mentored Warren Buffett, for a rating system for financial analysts.

Wait… CFAI is not-for-profit ? I’m going to need to see a cash flow statement before I believe that.

dlpicket Wrote: ------------------------------------------------------- > Wait… CFAI is not-for-profit ? > > I’m going to need to see a cash flow statement > before I believe that. Have at it: http://www.cfainstitute.org/aboutus/reports/pdf/2008annualreport.pdf

About two-thirds who take Level III successfully complete the process. I dont get this stateemnt. Does this mean that 33% of people who have passed Level 3 never actually become charteholders??? or is the key word “TAKE” which is another way of saying 33% of people who have completed level 2 never go on to complete the rest ??

IH8FSA Wrote: ------------------------------------------------------- > About two-thirds who take Level > III successfully complete the process. > > > > I dont get this stateemnt. Does this mean that > 33% of people who have passed Level 3 never > actually become charteholders??? > > or is the key word “TAKE” which is another way of > saying 33% of people who have completed level 2 > never go on to complete the rest ?? It means 1/3 fail L3.

IH8FSA Wrote: ------------------------------------------------------- > About two-thirds who take Level > III successfully complete the process. > > > > I dont get this stateemnt. Does this mean that > 33% of people who have passed Level 3 never > actually become charteholders??? > > or is the key word “TAKE” which is another way of > saying 33% of people who have completed level 2 > never go on to complete the rest ?? I would interpret it as the latter. Those that pass L2 but don’t pass L3, or those do not complete all the paper work to get the charter after passing L3. It’s possible this number includes the sad souls who never get the work experience after passing all 3 levels - if I fell into this group I would go to Charlottesville fully armed).

no, it’s saying 33% of people who actually sit for LIII never complete the process… "It costs about $2,500 to complete all three levels. " That’s wishful thinking…

The article was updated. http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aB41Lx90Jojk “About 20 percent of candidates who begin the test process will become charter holders, a designation now held by 86,968 people, according to the CFA. About two-thirds who take Level III successfully complete the process” But it is most likely referring to the people that take the LIII exam but never become charter holders (regardless of if they pass the exam or not). Edit: Actually, they are probably just referring to the number of people that pass LIII in comparison to the number of times LIII has been taken by individuals. CFAI exam stats: http://www.cfainstitute.org/aboutus/press/pdf/1963-2008A_candidate_examination_results.pdf 108,234 / 165,712 ~ 65%

Sounds to me like if you take L3 once, there’s a 66% chance that one of two things will happen: 1) You will pass, or 2) You won’t pass, but you will pass later on. And a 33% chance that either: A) You won’t pass and give up right there, or B) Will try again but not pass and eventually give up. How many pass L2 and then go on to L3 can’t be gauged by that statement, but I’m sure CFAI has the numbers on that too.

Folks, this is Bloomberg’s crappy writing. They probably took the L3 pass rate.

You do realize Non-Profit, doesnt imply/signify that the company doesnt earn a profit, that is stupid to think that. Non-Profit companies need to reinvest their profits into the company vs giving them out to owners (dividends for example).

A bit unrelated… I am surprised to read more people are signing up for the exam in this challenging environment. I thought it would be the opposite and people would spend more time working harder than studying to save their jobs. That’s my case at least… can’t really afford to spend too much time on this thing right now.

A bit unrelated… I am surprised to read more people are signing up for the exam in this challenging environment. I thought it would be the opposite and people would spend more time working harder than studying to save their jobs. That’s my case at least… can’t really afford to spend too much time on this thing right now.

Right… In fact, most non-profits prefer to call themselves “not-for-profits” because it emphasizes that the purpose of their actions and any charges they may levy is to deliver some service or social good, not to expand equity on the balance sheet. I used to work in not-for-profit work and always found myself having to point out that it’s tough work, because “not-for-profit” work is also “not-for-loss” work. You have to be able to pay your staff a decent enough rate to retain them, and you have to cover your costs, and you need to invest in strengthening the organization (as in resiliency in the face of uncertainties). But you’re not trying to create money for your owners. By the way, non-profits are also allowed to have profits on some activities - they simply need to pay taxes on those profits. For philanthropic organizations, like Sierra Club or Amnesty International, that usually is a public relations problem more than a legal or a tax problem, but for industry associations like CFAI it’s not really an issue.

non profit = profits goes to all the employees :slight_smile:

That sure would have been nice.

Nike Wrote: ------------------------------------------------------- > non profit = profits goes to all the employees :slight_smile: so investment banks are non profits.

" The CFA program started in 1963 and stems in part from proposals by Benjamin Graham, a pioneer of value investing who mentored Warren Buffett, for a rating system for financial analysts. " I did not know that .

I guess that would explain why the program is so oriented toward fundamental analysis and relatively light on technicals and quantitative management.