Prospectin’

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

I’ve been getting a good bit of emails concerning life after the CFA program – specifically what can be expected in terms of employment after passing all three exams (or maybe even only the first or second).

People obviously want to know whether the CFA program is going to be worth their time and money in terms of opening financial employment doors, enabling a career switch, etc.

Volume II
All Hail Volume II!

In short, I don’t really know the answer to any of these questions because (in a nice way) I don’t really care.

I think I’m maybe sort of like the student majoring in Art History or Religious Studies who knows that it may be difficult to find a job later on, but is so passionate about the subject that he can’t help but take the risk.

Well… maybe that’s not the complete picture. First of all I don’t think the prospects are as dire as they are for Art History. And I guess I do have the following ideas floating around in the back of my brain:

    (1) With my engineering / algorithm development background along with passing the 3 CFA exams, I could probably get my foot in the door as a quant somewhere.

    (2) Or I could start my own business managing other people’s money. According to this link you don’t really need any sort of certification to do this (in the USA). But having passed one or more CFA exams can only help in attracting clients and making sure you basically know what you’re doing. Maybe this would even count towards the required work experience for the official CFA designation?

    (3) The stuff I’m learning in the program should make me a better private investor, so even if I can’t break into investing I’d expect to at least recoup the money spent on the program by not making any (more) significant errors managing my IRA and HSA.

    (4) Finally, many of the lessons learned in the program carry over into other areas of life. The quantitative methods and statistics sections have already made me a better engineer. And knowledge of economic & business principles could maybe be seen by an employer as partially (though certainly not completely) MBA-ish.

Well I managed to finally finish up Volume I and am on page 41 of Volume II (Economics). The sections so far on elasticity have been fascinating. I think I now understand another reason behind why stores have sales. Disregarding other factors (e.g. clearing shelves for next season’s products) it seems a sale could tell you whether you’re selling your products at the right price.

By temporarily changing the price of a product and keeping track of the corresponding change in quantity sold (or revenue made), you can determine where you are on the elasticity curve. That can give you a good indicator as to whether you should raise or lower your regular price to maximize revenue (see total revenue test).

This stuff shouldn’t be new to me. Funny thing is, I took both macro- and microeconomics in college but remember almost nothing! There was a large set of old test problems floating around and the word on the street was that if you basically tossed the textbook aside and just concentrated on working the old problems, you’d have a much easier time passing the tests (true).

Sound familiar? 😐

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

18 thoughts on “Prospectin’”

  1. making fun of art history majors huh? lol. i’m just kidding around. good luck with your cfa studying! ps. i’m not an art history major. i’m a commerce (accounting/economics/finance) major.

  2. in my opinion, anyone taking the CFA exams without any previous experience for the purpose of working in the field should realize that you are trying to use the exams to get in the back door. That door is locked…passing the exams are a tool…you still have to figure out how to use that tool to pick the lock.

    The front door seems to be internships and a top buis school MBA..or of course having uncle Bob work in the field.

    But once you sneak in the back it is my guess you will fit right in at the party and no one will ask how you got in. (and you will have saved yourself a ton of $).

    The lock is not easy to pick but with the right effort it is my belief it can be done.

    Good luck to all on the exams and on the job search.

  3. Ah well yellow19man my wife has an art degree and she managed to find work!

    Thanks for the post anon. Reminds me of an interview I read with author Elizabeth Gilbert (Eat, Pray, Love) about breaking into writing. Paraphrasing: “… doing so is like finding a cheap apartment in New York City. It’s impossible, and yet everyday people manage to do it.

    -Lumilog

  4. Hey man, good luck with your studies! I wrote level 1 today and feel confident. Try to answer as many past papers as you can when reviewing. (SchweserPro was useful to me here.)

  5. Hey,

    I just started reading your blog and I find it very interesting. Myself, I am also writing the CFA level 1 in June. I already have a Bachelor of Commerce with option in Finance whit extensive classes in economics and public finance, however. I see great progress and I am very happy for you. Furthermore, I appreciate you writing about your path towards this gold standard, I certainly will keep reading. I will tell you though, as someone who already study the curriculum in university, that the study will get much more interesting when you start studying capital market theory, portfolio management, and derivatives. Word of caution too, I stronly suggest you start using the Texas BAII plus financial calculator, it is more flexible with a more comprehensive worksheets: bonds, amortization, TVM etc… I work in the financial district and I have never met someone who preferred the 12C over the BAII plus, it is simply more efficient and those seconds saved will matter on the day of the exam.

    Take care, I will keep reading.

  6. Thanks for the info anon. Can’t wait to get to the more advanced topics you mentioned. Chomping at the bit!

    Yes I’ve had quite a number of people now tell me to switch to the BAII+. I most probably will around the first of the year. I’m in the Economics section now and not really using the calculator much so I haven’t made it a high priority. 🙁

    Good luck with your studies and thanks for writing!
    Lumilog

  7. Good news for me! Work have agreed to pay for the exam and a prep course. Prep course is by BPP (in the UK) and consists of 5 days of learning, 3 days of revision, a maths booster course (with free BAII calculator), Shweser Pro study notes and a mock exam with mentoring afterwards.

    Got my CFA books on Thursday (not received Schweser yet) and blasted through Ethics and GIPS. The ethics examples were a bit obvious weren’t they? I skipped most of them! Now onto TVM……

  8. I also just wrote Level I this past Saturday and have found your website to be extremely helpful for insights on the CFA. In hindsight, it might’ve been a good idea to focus on problem sets, but, honestly, I felt that the exam focused alot on the concepts above all else and that, as they say, the ‘devil’s in the details.’ I would have liked to spend more time on concepts (the Schweser books were very helpful though in my studies as another person commented above).

    Best of luck to you, Lumilog; I’ll look forward to reading your blog as you continue on your path…..

  9. Thanks for the comments, Craig. Yes the ethics were mostly straightforward for us saintly types! 🙂 Good luck with TVM – I think you’ll find it more interesting.

    Wishing you much luck on passing, Bob!

    -Lumilog

  10. Hi Luminous,
    Keep up the great work in your blog. reading other people’s post here actually inspired me to pursue my CFA. Found your blog when i was researching about CFA. am in a similar position with people having no background in accountancy/finance/business. but that is not going to deter us to pursue this track :).

    You can always switch to BAII. Its very easy to use and along with some online tutorial you can solve pretty much anything. I havent tried a host of problems, just TVM, a few stat problems, annuities. so easy to use.

  11. Well your prospects for joining the CFA program are very good if you’ve got the cash! …but I assume you were talking about job prospects.

    As you’ve no doubt heard, the financial sector has had a huge # of layoffs. Perhaps having a CFA will become more of a prerequisite than a differentiator.

    As a current Level II candidate, I can say that my CFA experience has resulted in my getting nibbles of interest and interviews from a couple asset mgmt firms. But the current economy seems to be keeping everyone in a holding pattern, with neither Yea nor Nay decisions being made regarding hiring.

    Just a continued “let’s touch base again in a month”…

    -lumi

  12. Well, you have handles quite a good issue with humor and light way. I appreciate it. You can have a look at my blog also for some CFA related info.

  13. having passed all 3 exams you should know you dont have the charter until you have 4 YEARS of qualifiable experience where you are involved in an investment process at least 50% of the time at work or you are in a financial reporting function.

    Having the exams are great along with your experience but it won’t add any value until you have 48 months of qualifiable work experience. CFA isn’t just about passing the tests its about experience in the field as well.

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