Is the CFA worth it?

Yesterday Billy, one of the L3 Candidates in our custom course, asked me if the CFA designation has helped in my career and if so, how. Here's my answer.

Other than building a business on top of the CFA exam (a pretty direct use case), I think I've gotten value out of my CFA in a few ways. 

Earning the CFA designation gives you a community

First, there is a network of other Charterholders and past Candidates that all know exactly the dedication and hard-work it takes us to pass all three levels. That's a community, a brotherhood. 

And sure, one benefit of a community is that it can help in networking and job hunting. In fact, that just happened to me last week. 

I was trying to get advice from a senior exec at a different company and it turns out that she had been with her now husband while he was studying for L2 and L3. Her connection to the ",CFA" after my name is what got her to talk to me in the first place and our connection over the pain of the process was a great, genuine icebreaker.  

The CFA vs. an MBA - A helpful credential

The CFA designation also has real brand value. The quality and breadth of the exams, the difficulty of passing, the community we just talked about, and the dedication and reputation of the CFA Institute all set Charterholders apart from other designations. 

Let me put it this way....I have a master's degree from the University of Cambridge, one of the top universities in the world, but early in my career I still think it was the CFA designation that immediately put me on par with top-tier MBA Candidates, even when not in a directly investing related capacity. And yes, in some ways that's because it tells a more direct story than my MPhil in Economic History from Downing :).

The content of the CFA curriculum gives you a broad base of knowledge

We should probably talk about the content of what you're learning too. The set of investment material that you're forced to learn is broadly useful, even if its hard to see that when you're studying all the time. 

That utility is not just on the macro. I've worked in a variety of analytical jobs where the mix of accounting, investing, and corporate finance I learned is constantly useful. It's invaluable to always have a broader context when setting goals and putting together all the different pieces of the puzzle. That's true whether you're a bond manager with a basic understanding of derivatives or alternatives or an accountant with a sense of corporate finance. Now I'm not saying the CFA is required to get this broad base of knowledge, but it was definitely helpful.

Going back to the MBA thing, some folks who have both say that the CFA knowledge base is often more advanced than many of their B-school classes. That could be true, I don't know about that personally. 

But I can tell you one thing. I would put money on the fact that we've done more calculation questions than them. And I know, because it's been proven, that there is value to memorization/drill based learning that is impossible to replicate without putting in the time.      

The meta benefits of the CFA exam process can have spillover effects

Outside of reputation, community, and knowledge there's also some meta benefits to going through the exam process. And really, what I'm talking about when I say that are habits. 

As a Candidate I learned to be disciplined about my time and to be productive in micro-increments (I often talk about this as "macro-managing" your life and "hacking study time"). If you walk out of the CFA candidate process knowing how to own your calendar and be disciplined/consistent about creating extra work time without ruining your life that's powerful stuff. The rest is gravy. 

I really believe that, so let me say that one more time but in a different way that probably resonates with you. No spring has ever been quite as painful as the two Springs (and one Fall) where I combined a full time job with trying to pass all three levels in 18 months.

I admit it didn't help that I had a very long distance girlfriend for some of that (then again, maybe that was helpful in getting me to pass). Thanks Mica!  

(And yes Billy, learning to sleep more again is probably a good idea when you're done). 

So what's the bottom line? 

I started studying for L1 thinking I would be a portfolio manager. A few years after I passed the exam I was running my own company (this one) and working as an exec focused on G2M strategy and revenue operations in a high growth Fintech startup. No matter where I've worked, the combo of what the CFA forced me to learn and the reputation boost its given me have always been useful. 

So that's my take and my story. But the real question is, what do you want your story to be? 

Hope that helps,

P.S. Step 1, whatever your answer to the last question, Chapter 1 of that story is passing. That's where we come in