Hot Shot! Part Deux

For a chronological index of my path to the CFA, click here.

Quiz for the day…

Your colleague has heard that you’re studying for “some sort of big stock market test” and asks you more about it. You respond that it’s to become a Chartered Financial Analyst. He replies, “Ah! My brother is one of those, a Certified Financial Planner…”

Your response:

    (a) “Ah! Right! Small world!”
    (b) “Ahhh… Riiiiiight… similar…” And if pressed you describe the CFA program as “a little more rigorous”.
    (c) Icy silence. Mouth hanging open in disbelief.
    (d) “Oh reeeeeally? And I hear you have a master’s degree in electrical engineering. Well guess what, my brother is an electrician too!”
    (e) Sending them to this link.

Aw come on… I have to pick on the competing programs! 😈

Finnish Line

Before leaving for Finland I remembered how interminably long it took the CFA Institute to ship my Level I study guides to me (well it wasn’t that long, but I was dying to get them) so I registered for Level II the night before our departure. The thinking was that they’d arrive a few days after we returned.

And to my horror the first time I checked email in Helsinki, I already had a shipment confirmation. It had been less than 48 hours! I pictured returning in 2 weeks (in the middle of hurricane season) to a moldy, falling-apart box of study guides that looked like they’d been recovered from the Titanic.

And while we did return from the so-called better side of the arctic circle in the middle of a tropical storm, a neighbor had kindly rescued my new litter of soon-to-be constant companions.

The first thing I looked at upon arriving was the weight listed on the box. It’s 19 pounds versus Level I’s 18.1 pounds. Just like it says on my toothpaste, 5% more for free!

On the whole, the topics aren’t that different. Let’s compare…

So it’s mostly the same stuff, but (according to Wikipedia)…
• Level I emphasizes tools and inputs and includes an introduction to asset valuation and portfolio management techniques.
• Level II emphasizes asset valuation and includes applications of the tools and inputs in asset valuation.

During registration for a CFA exam, you have to complete a sort of questionnaire about your current work experience. Like last time, question after question I’m checking “Does Not Apply” and “Not Applicable” to inquiries about my assets under management, stock analyst duties, etc. The fact is, I’m still a full time electrical engineer.

When I first registered for the program a year ago, I considered the required 4 years work experience in order to earn the charter a bridge I’d cross when I got to it. My thinking at the time was that I may in fact never fulfill it, which didn’t matter since my prime directive for being in the program was the investing education I’d get in the process of passing the exams. Sort of like Jim Rohn’s old adage of (I’m paraphrasing)…

Try to make a million dollars. Not for the wealth itself but for the person you will become in the process.

The reason I thought I may never complete the work experience is that it has to be from full-time positions. This conflicted with my dream of diversification of income streams, all from a collection of part-time duties (a little engineering contracting, a little asset management for friends, a little blogging for adsense, a little daily trading of my own).

A year later I’m starting to re-think this. It’s a sizable effort to complete these exams so it would be a shame to never get to the finish line and get the charter in hand. Plus I really love investing, why would I not want to do it full time? So unless something better comes along, I’m now kicking around the idea of slowly converting my LLC from part-time engineering to full-time asset management and investing research. I’ve already had a few nibbles as to when I’ll be “open for business” but have stalled so far as I think I might need a Series 65 or something first in order to be legal.

I inquired with the CFA Institute about whether you can fulfill the work experience working for oneself. I was told that self-employed candidates can indeed apply for the charter, though they examine each person’s history on a case-by-case basis to determine what they’ll accept and what they won’t (same goes for working for someone else).

For all of my fellow candidates out there with a new set of study guides looking for a shot in the arm or a kick in the pants to get you moving, here’s a quote (of the many I’ve come across) that indeed actually works to motivate me on a day-to-day basis.

If I repeat today’s actions 365 times, will I be where I want to be one year from today?

I don’t know why this one is particularly powerful for me. Maybe because I admire who said it – Roz Savage – who is, as we speak, rowing solo across the Pacific Ocean…

This time around I am hoping to keep track of the total number of hours I spend studying, just in case that’s helpful for future candidates. My current plan is to log at least 1.25 hours a day. As I’m sure to miss this goal either partially or completely on some days, the hope is that this will average out to at least 1 hour per day, putting me slightly above the 250 hour minimum suggested number of preparation hours by the CFA Institute.

If I study 1.25 hours today, and repeat (almost) 365 times, will I be where I want to be on exam day (June 6, 2009)?


For a chronological index of my path to the CFA, click here.