Why the investment credential is moving fast to stay relevant

THE Chartered Financial Analyst (CFA) programme aims to produce individuals with a good understanding of the key techniques, major asset classes, and ethical and professional standards most needed in today’s investment industry.

The course is made up of three progressive levels of study. Level I focuses primarily on testing investment tools, Level II on asset valuation, and Level III on portfolio management. And the curriculum centres around ten core topics, including portfolio management and wealth planning, quantitative methods, and economics.

Over the last decade, and not solely because of the financial crisis, the curriculum has had to adapt significantly to a changing investment industry. And these changes have started coming faster. In 2007, the Education Advisory Committee of the CFA Institute began to conduct its evaluation process continuously rather than every five years.

The past decade has particularly seen a sharp shift in the CFA programme’s focus away from simple accounting to a more holistic analysis of companies’ financial reports. This is intended to reflect the increasing importance of corporate reporting standards in both the investment industry and society as a whole.

In addition, the weightings given to individual asset classes in all levels of the CFA programme have shifted to reflect the increased use of derivatives and alternative investments in the industry. The increasing complexity of investment products has also resulted in a greater demand for non-investment professionals, like those in client services, to be CFA accredited.

But while the ability of the CFA charter to keep up with underlying movements in the market is attractive, there are still alternative credentials on offer that deserve consideration.

The Certificate in Investment Performance Measurement (CIPM) is a specialist qualification for investment professionals with a specific focus on investment performance evaluation. In response to the financial crisis, the CIPM curriculum has also changed. From 2013, for instance, candidates will be taught new skills designed to help them better evaluate and select investment managers for their clients.

Opinions are mixed about the relevance of the CIPM outside of performance measurement, however. Jim Trotter, executive director at investment analysis firm MSCI, took the CIPM programme to complement his 26 years’ experience in the industry. He says that the new weightings make it “a relevant qualification for more than just performance professionals; many roles in investment forecasting can benefit.” But Colin Kay, head of performance at HSBC securities services, disagrees. He says the CIPM is “too specialised to be of widespread interest to those outside of the industry.”

At the other end of the spectrum, the Claritas Investment Certificate is a graduate-level course that gives students a much more basic grounding in the investment industry, with modules in investment instruments, industry structure, and serving client needs. It was created in response to the growing market for investment knowledge from people who work alongside those in investment roles – including consultancy, legal, PR and IT professionals.

But although an evolving qualification can assist new entrants in accomodating themselves to the changes facing the invesment industry, there is still a burden on professionals themselves to adapt. All these qualifications depend on an interest in continuing education. While investment credentials are a useful means of demonstrating your understanding of the new world of investment, they can’t do so on their own.


Aims to provide a foundation in investment analysis and portfolio management, along with a degree of practical knowledge.

To enroll in the programme, candidates must have a bachelors degree or equivalent.

Exams are held in June, with an additional sitting in December for Level I students.

Costs vary depending on what time of year candidates register, but range between $1,080 and $1,585 (£670-£985).


Aims to teach the practical skills and knowledge required to evaluate and communicate investment performance.

There are five core topics, including performance measurement, performance attribution and ethical standards.

Exams are held twice a year in April and October, so it is possible to complete the course in one year.

For first-time candidates, course enrolment (including exam registration and curriculum ebook) will cost $1,950 (£1,210).