Successful investors recognize the importance of education and knowledge when it comes to managing financial assets. But while they may spend countless hours learning about markets, securities, and associated risks, investors often overlook the qualifications of the professionals whom they hire to manage their money. If you work with investment advisors, they will have access to the most personal details of your finances, so their credentials should matter to you. There are a number of reputable credentials that financial professionals in different disciplines may hold, but none are as rigorously focused on investment knowledge as the CHARTERED FINANCIAL ANALYST® (CFA®) designation. Understanding the significance of the CFA® charter, and the process to obtain the designation, can be useful information when choosing an investment advisor.

Tradition

In the late 1940s, Benjamin Graham, often called the “dean of investment analysis,” first proposed a “Qualified Securities Analyst” designation for members of the growing investment profession.

Knowledge and Experience

To become a CFA® charterholder, a candidate must pass a series of three practice oriented, six-hour examinations, taken in sequential levels over at least three years. Core elements of the CFA® curriculum include investment tools (economics, financial statement analysis, quantitative analysis), asset valuation (analysis of debt investments, equity investments, derivatives, and alternative investments), and portfolio management (both institutional and individual, including performance measurement). Importantly, each examination includes a thorough section testing knowledge and application of ethical and professional standards. Achieving passing scores on all three exams is no small feat. Each of the six-hour examinations takes, on average, approximately 250 hours of intensive study and preparation. As rigorous as the curriculum and examinations are, the CFA Program requires more than academic preparation. Before they earn the right to use the CFA designation, candidates must have at least three years of acceptable professional experience in the investment decision-making process. Additionally, they must fulfill CFA Institute’s membership requirements and commit to uphold the stringent Code and Standards.

Ethics

The integrity of investment advisors is of the utmost importance. Their skills and advice directly impact the financial well-being of their clients. That is why every CFA® charterholder and CFA® candidate is required to sign an annual statement declaring their adherence to the Code of Ethics and Standards of Professional Conduct. The Code and Standards require them to act with integrity, practice in a professional and ethical manner, exercise independent professional judgment, and put client interests before their own.

To learn more, please call our Portfolio Manager, Cliff Hodge, CFA® at 864-421-6845 or submit a contact form.

Menu