Is CFA useful for corporate financing?

The Chartered Financial Analyst (CFA) is an international professional title provided by the CFA Institute and awarded after completing three exams. This is a prestigious title in finance and investment, and anyone interested in a career in corporate finance should consider this. In some cases, CFA is a worthwhile risk, while in other cases, it is more advisable to pursue a Master of Business Administration (MBA) or even the title of Chartered Alternative Investment Analyst (CAIA).

It is not easy to obtain the CFA title, and the time, energy and money required to obtain the title are considerable. It takes more than four years and approximately US$2,400 to pass the test. However, please be aware that your employer may incur expenses or reimburse you after you pass the exam.

Corporate Finance in the CFA Exam

CFA is divided into three levels, usually referred to as L1, L2, and L3 for short. As of 2020, 10% of the first exam covers corporate finance topics.The second exam is different from year to year, but corporate finance topics usually cover 5% to 10% of the exam.The third level usually has no corporate financing focus.

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Portfolio management, stock research and hedge funds

As a general qualifier, the CFA title never hurts. However, some parts of the course are more applicable to corporate finance careers than others. Corporate financing is a somewhat vague term, but the CFA exam covers typical areas in this field, such as working capital management, budgeting, leverage, foreign exchange, and all related research.

The CFA Institute has self-reported data for self-holding certificate holders. As of 2017, there were more than 160,000 certificate holders at that time.23% of CFA professionals worldwide are portfolio managers. Specifically, this proportion has risen slightly to 24% of the US CFA. The second-highest position in the report is a research analyst, with a global share of 15% and the United States accounting for 16%. No other specific function gets more than 7%.

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Hedge fund analysts usually perform similar duties as stock researchers for large fund managers, and the CFA designation can help credential professionals trying to break into investment buyers. This may or may not be considered company finance, depending on the location of the job. For example, corporate finance in the United States is often synonymous with financial planning, accounting, and analysis. However, in the UK, corporate financing has further expanded to investment banking or hedge fund activities.

Is your employer a licensee?

Whether you pursue CFA may depend on the company you want to work for. Suppose you want to work for a multi-billion dollar company or even a multinational company with a large financial department. If the company’s treasurer is a CFA charter holder, which is more likely for large companies, then CFA may be useful. Adding this name to your resume should help you fight against the career development of non-CFA candidates, and the training involved in preparing for the CFA exam should help advanced functions often required by large companies, such as foreign exchange trading or international stock research.

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The scope of CFA courses is very wide, not particularly in-depth. For many professional occupations, such as corporate accounting or capital financing, a more specific degree or title may be more useful. For many corporate finance jobs, it may be better to have a master’s degree in finance.

If you just started

Many Fortune 500 financial and investment companies use MBA as a filter for applicants. MBA is more costly and usually requires more total time to complete than CFA.In addition, the total number and range of opportunities for young professionals with an MBA degree are much broader than those for young professionals with a CFA.


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