A Little 11th Hour Motivation

It’s easy to get burnt out as you enter the final weeks of studying before the CFA exams. Most likely, you’ve already got a few hundred hours of studying under your belt and those voices inside your head are questioning if it will even be worth it.

Sometimes it helps to step back, take a breath and look at the big picture. Ask yourself, why are you taking the exams.

Why are you going after a charter where only about 19% of candidates are able to complete? Each of us may have a slightly different motivation for seeking the designation.

Many want to earn more money or just be able to get a job. Others want to be able to be better analysts or perform better in their career. For others, it is just a natural progression in continual education.

Then, there are some with entirely too much time on their hands and nothing else to do. To each his own.

Like most, I started studying for the CFA for a combination of the reasons above. I had fairly good experience in corporate finance but less in asset management, which was where I wanted to work.

Besides this, I’ve always felt strongly about continuing education and believe that if you are not running faster than the next guy then you’ll be the first one eaten when the lion comes!

Since I passed the exams and earned the charter, I have been amazed at the number of projects I’ve picked up in my consulting business. The reception of the CFA designation by my clients has been extremely positive, especially by those that have tried the exams.

Glenn Buggy of CTPartners called the designation a, “badge of honor,” in a recent article on eFinancial Careers and said that, “To be able to play in the game now, you have to have the most modern financial tool kit that you can.”

A recent survey taken by the website found just over 43% of job postings for portfolio manager cited a requirement or preference for the CFA charter or candidacy.

Earning your charter alone is not going to get you a six-figure job, but it will certainly get your foot in the door for an interview at many places.

The most recent Institute Membership Compensation Survey I could find was from 2007, but both base and bonus compensation compares favorably to even today’s salaries for non-charterholders.

While research is not inconclusive, there is evidence that charterholders perform better in their line of work as well.

Research by Fortin and Michelson in 2006 found that, on average, analysts who hold the CFA charter provide 3.78% ‘tighter’ forecast accuracy than non-charterholders.

Research by Franco and Zhou in 2009 found that charterholders score higher on a dimension of timeliness and that performance is higher and statistically significant.

Your charter will put you in good company as well. Professionals like Abby Joseph Cohen, Sir John Marks Templeton, Bill Gross and (of course) Ben Graham all found value in the charter and its principals.

While these great investors were not great just because they held the designation, or proposed it in the case of Graham, their determination and work in earning the charter helped them achieve their status.

What is your motivation for the long hours and hard work? Use the comment section below to tell your story. Your motivation may help someone else keeping going.

Just four more weeks. Hang in there! ‘til next time, happy studyin’

Joseph Hogue, CFA

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