As most of you know, the difference between Level II and Level I is like night and day. I know that many people (including myself) have passed Level I without working in the financial industry. How rare is it for people to pass the Level II exam without working in the financial industry? I get the impression that this almost never happens given that even people working in the industry have a substantial advantage over those who do not, yet STILL find Level II difficult. The advantages that the people in the industry have over those who do not are: 1. The support of their bosses and colleagues: The rest of us, for obvious reasons, must keep our financial career aspirations secret. Thus, we don’t get the support of our bosses and colleagues. 2. They eat, sleep, and breathe finance: The rest of us can’t when we have that other career to work on. Have there been any studies comparing groups of CFA candidates? I suspect that the Level I candidate pool has a much higher proportion of financial industry outsiders than the Level II and III candidate pools. I’d expect the pass rate of the financial industry outsiders is somewhat lower than the pass rate of those already working in the industry. I’m guessing that for Level II, the financial industry outsiders are a much smaller percentage of the candidate pool. I expect the difference in the pass rate of the two groups of candidates to be wildly different - fairly good for the group working in the financial industry and remotely tiny for the group not in the industry. I’m guessing that for Level III, the candidate pool consists nearly entirely of people in the industry.
Dude tons of people pass both Level II and III without being in the finance industry because they think it will get them into the finance industry. They are usually wrong. The CFA exam is meant for people in the industry. Do a search, you will find a few hundred billion threads on this topic, maybe more. Want to get into finance, go get yourself a good MBA
That’s what I’m suspecting. If the industry were hiring like gangbusters, not passing Level II won’t stop me. If the industry isn’t hiring, even passing Level III won’t be enough. Given that my specialty is value investing and undervalued assets are so rare, I doubt that the industry is hiring very many value-oriented analysts right now. Even passing Level III won’t bring back the Golden Age of value investing (1974-1982). I’m signed up for this year’s Level II, but I’m not signing up for any more exams until I’m actually working in the industry. Until then, I think I should network more and do some volunteering for the local CFA group so I can gain some visibility. Also, I should try analyzing lots of stocks so I can practice and refine my value investing tactics. Even if I already had Level III completed by now, I’d still need 4 years of work experience to earn my charter. I think that once I’m working in the industry, I stand a good chance of passing Level II and Level III. If all goes well, I can pass Level II and Level III halfway through the 4 years of work experience I need.
DiehardValueInvestor Wrote: ------------------------------------------------------- > … I think that once I’m working in the > industry, I stand a good chance of passing Level > II and Level III. … I disagree for two reasons: 1) Even the broadest of finance jobs only uses about 5% of the concepts covered in the CFA curriculum. (Though an actual finance job is likely to go 10x DEEPER into those few specific concepts than CFAI does.) Working in one area of finance will teach you only a teeny tiny sliver of the broad topics you need to learn to pass the CFA exams. 2) Any proper finance job will not leave you with much free time to devote to studying. And most people find that all of the free time that they had in their early twenties quickly dwindles as they take on more life responsibility.
Wendy Wrote: ------------------------------------------------------- > > I disagree for two reasons: > > 1) Even the broadest of finance jobs only uses > about 5% of the concepts covered in the CFA > curriculum. (Though an actual finance job is > likely to go 10x DEEPER into those few specific > concepts than CFAI does.) Working in one area of > finance will teach you only a teeny tiny sliver of > the broad topics you need to learn to pass the CFA > exams. > Then maybe I don’t actually need to pass Level II and Level III. I highly doubt I’ll ever have a boss who will tell me, “You’re a lousy financial analyst because you didn’t pass the Level II exam. If only you passed it, you’d be the best.”
^ Wendy’s argument isn’t totally correct, and someone banking on it would be misled. Working in finance, you won’t directly use the entire curriculum (obviously), but it’s definitely more than 5%. This range can vary widely, so I see no point in tacking on an exact %, but the real point, is that given your exposure to so many areas of finance, equities, accounting, alternatives, quant, derivatives… etc. you become much more aware of the world of finance on a broader view and that foundation definitely helps in any finance job no matter how broad or specific. 2) Totally disagree.
greengrape Wrote: ------------------------------------------------------- > ^ Wendy’s argument isn’t totally correct, and > someone banking on it would be misled. > > Working in finance, you won’t directly use the > entire curriculum (obviously), but it’s definitely > more than 5%. We’re making different points Greengrape. I think you’re saying that a large portion (>>5%) of the CFAI curriculum will be useful to you in a finance career. I agree with that. Even if you end up in equity research, knowing about bonds, derivatives, currency hedging, etc will be invaluable throughout your career in many ways. My point is that the “opposite” effect – learning the CFA curriculum through work experience in finance – is unlikely to happen. Actually working in finance provides only a very small advantage in tackling the CFA curriculum.
DhVI, how can you be so sure that your passing Level III won’t bring back the Golden Age of value investing (1974-1982)?
greengrape Wrote: ------------------------------------------------------- > ^ Wendy’s argument isn’t totally correct, and > someone banking on it would be misled. > > Working in finance, you won’t directly use the > entire curriculum (obviously), but it’s definitely > more than 5%. This range can vary widely, so I see > no point in tacking on an exact %, but the real > point, is that given your exposure to so many > areas of finance, equities, accounting, > alternatives, quant, derivatives… etc. you become > much more aware of the world of finance on a > broader view and that foundation definitely helps > in any finance job no matter how broad or > specific. > > 2) Totally disagree. I also disagree with Wendy. I work in a specific area of an alternative asset class. So you’d think that 99% is irrelevant. I’ve actually learnt tons on the job that has made very little in this year’s Level 2 curriculum appear difficult or unfamiliar. The fixed income section this year was reasonably relevant & interesting in a broader macro sense, and I have *nothing* to do with fixed income on a day to day basis. Having said that, my view (and the view of my colleagues who have the charter), is that anyone with financial reporting (accountancy) education or work experience has a bit of a head start over those who don’t. At the end of the day, it’s not rocket science, it’s just a competition to see who can absorb and retain an enormous amount of useful general (financial) knowledge. Finding 300 hours and staying motivated for 300 hours is the key challenge, not the content.
Captain Windjammer Wrote: ------------------------------------------------------- > DhVI, how can you be so sure that your passing > Level III won’t bring back the Golden Age of value > investing (1974-1982)? This made me LOL
Captain Windjammer Wrote: ------------------------------------------------------- > DhVI, how can you be so sure that your passing > Level III won’t bring back the Golden Age of value > investing (1974-1982)? This made me LOL
I don’t see why someone who isn’t in finance can’t pass Level 2. The question is why are you taking CFA exams if you are not in finance?
dmiller385 Wrote: ------------------------------------------------------- > Captain Windjammer Wrote: > -------------------------------------------------- > ----- > > DhVI, how can you be so sure that your passing > > Level III won’t bring back the Golden Age of > value > > investing (1974-1982)? > > > This made me LOL haha
ohai Wrote: ------------------------------------------------------- > I don’t see why someone who isn’t in finance can’t > pass Level 2. The question is why are you taking > CFA exams if you are not in finance? I’m surprised ohai, you’ve been here long enough to see all the newbs thinking passing the cfa exams is a sure-fire way of breaking in. unless you were being sarcastic… and I didn’t catch it.
Nah, I understand that people think CFA will help them get finance jobs. It just seems weird to me that people believe that their lives will be so much better after they get a job in some bank - so much that they are willing to spend hundreds of hours working on some credential conferred by a random private (and somewhat sketchy) organization.
Passing CFA is like getting a decent score on SAT/GMAT/LSAT/MCAT, all it takes is ability to takes test and retain material
I passed L2 while not officially in the business. So it can be done.
ohai Wrote: ------------------------------------------------------- > Nah, I understand that people think CFA will help > them get finance jobs. It just seems weird to me > that people believe that their lives will be so > much better after they get a job in some bank - so > much that they are willing to spend hundreds of > hours working on some credential conferred by a > random private (and somewhat sketchy) > organization. It’s all about the money.
ohai Wrote: ------------------------------------------------------- > Nah, I understand that people think CFA will help > them get finance jobs. It just seems weird to me > that people believe that their lives will be so > much better after they get a job in some bank - so > much that they are willing to spend hundreds of > hours working on some credential conferred by a > random private (and somewhat sketchy) > organization. It’s no different then people who think passing the CPA exam will get them a job in public accounting.
bchadwick Wrote: ------------------------------------------------------- > I passed L2 while not officially in the business. > So it can be done. ^ Don’t listen to this newbie, I’ve never seen him before. No one has ever passed LII without working in the industry. Ever. I know it seems statistically improbable, but you have to trust me on this. Besides, if it wasn’t true would I be able to just post it on the internet? No. CFA > MBA