Thousands of CFA candidates sit exams

(June 6, 2005) The last-minute cramming is over for those taking CFA exams. More than 77,000 people around the world challenged one of the three different levels of the Chartered Financial Analyst program this past weekend.

The six-hour exam tests four major topic areas including ethical and professional standards, tools and inputs for investment valuation and management, asset valuation, portfolio management and performance presentation.

According to the CFA Institute, only one in five candidates successfully complete the program for start to finish. Level one exams are administered twice a year in June and December while levels two and three are administered once a year in June. Currently there are 107,000 people registered in the program.

“In the 1940s, Benjamin Graham first wrote an article about the idea of creating the CFA program that would give the professional designation a charter. One reason that he and others were very involved in that effort was to take what was viewed as an analytical and quantitative set of activities, bring it to the level of a profession,” said Jeff Diermeier, president and CEO of CFA Institute.

“You’re dealing with people’s lives, their incomes, and their ability to live out their lives happily. There is a myriad of things that needed to be brought together. It wasn’t a simple statistical exercise. So through the creation of the CFA program in 1963, the CFA Institute has been involved in clearly accomplishing that major goal — that is to elevate our industry to the level of a profession.”

In Canada, 7,504 CFA candidates were enrolled to sit for the exam in 16 test centres, including Calgary, Coquitlam, Edmonton, Fredericton, Halifax, Kelowna, London, Montreal, Ottawa, Regina, Sainte Foy, St. John’s, Toronto, Victoria, Winnipeg, and Yellowknife.

Interest in obtaining the professional designation is on the rise. And this year more than 50% of CFA candidates live and work outside of North America. This weekend, 38% of all exam candidates were from the U.S., 22% from Asia, 15% from Europe and 10% from Canada. With 4,953 people challenging the exam, Mainland China had the largest number of candidates from outside of North America, a 41% jump from last year, followed by Hong Kong with 4,584 candidates, Britain with 4,326 candidates, South Korea with 3,042 and Singapore with 2,479 candidates.

Currently, more than 64,000 investment professionals in 112 nations and territories hold the CFA charter. A survey released last week by CFA Institute and Russell Reynolds suggested that investment professionals with the CFA designation earned significantly more than their peers. The median compensation for CFAs is expected to be $130,000 this year, compared to $103,500 for those without the designation.

Exam results will be released in August.

Filed by Kate McCaffery, Advisor.ca, kate.mccaffery@advisor.rogers.com