Friday 25 January 2019 3:12 pmCFA Institute Talk

Changing industry, changing skill-set

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These are articles written by professionals for investment professionals. They are contributions from external subject matter experts who do not work for CFA Institute, but may be a CFA charterholder as well as a member of a CFA Society. All are experts in their field and strive to deliver useful insights that help investment professionals make better decisions.

In the 1990s, the skill-set required by asset management professionals was vastly different. The investment universe consisted primarily of equities and bonds. Alternative asset classes like hedge funds and private equity were accessible only to high net worth individuals and some particularly sophisticated pension funds.

Balanced managers were hired to outperform benchmarks, not produce outcomes. And investment professionals were hired from various disciplines outside of finance.

Now, of course, all that has changed. Globalisation, demographic trends, a low yield environment, and technological drivers means the industry has become far more specialised and outcome-orientated.

“We live in a much more data-rich society. The skill-set required for investment professionals has become much more about data analytics and understanding and manipulating large data sets efficiently,” explains Sarah Dudney, client partner at The Buy-Side Club, the talent strategy and recruitment firm.

It is no surprise then, to see that financial designations have had to evolve over the last 25 years. Take the Investment Management Certificate (IMC), for example. The qualification, which turns 25 this year and is offered by CFA Society of United Kingdom, is now more quant-focused than it has ever been. Themes like ESG and ethics are also playing a wider part in the curriculum, which they did not do 25 years ago.

“We have a panel of practitioners and academics who work in the industry and feed in their opinions to keep us relevant. It’s important that we address how the industry is evolving in what we offer,” says says Tim Scholefield, chair of the IMC Panel at CFA Society of United Kingdom.

Jeremy Smith, head of benchmark exams at Kaplan Financial, which provides training for the IMC, says it is about providing much needed context to new entrants into the industry. “To me, the qualification would allow new entrants to add context to where they fit into the industry and to their role. It’s not about having all the answers, but it’s about knowing when to ask questions,” he says.

Graduates of the IMC say it can help in different ways. For Ben Harrop, change manager at Schroders, it was about understanding the industry. “I arrived in Schroders after sixteen years in the British Army in September 2018. As I work on programmes that affect multiple parts of the business, I felt an understanding of the asset management industry (including formal qualification) was vital in terms of helping me learn the language of the industry and gain credibility working both internally and with external third-parties,” he explains.

He believes the IMC will help with his career progression. “Going forward the qualification will potentially enable lateral movement within Schroders, as it demonstrates an understanding of and aptitude for investment management,” he says.

For Doina Ceban, who is working in an investment risk role at an insurance company, it was about getting some insight into investment management as a whole. “I graduated with an economics degree and the IMC was really targeted for an investment professional. There were specific sections on risk and return. It talked about different risk modelling techniques and analysing an investment in terms of risk and reward trade-off, so that was helpful,” she explains.

According to Dudney, a qualification is like a ‘good housekeeping badge’ that gives participants a fundamental framework to understand the key principals in the industry. “On top of that everybody has to understand the complexities of the business, whether it’s passive, or developments in active, trends going on in ESG, or data analytics. You have to have a real polymath mind and you have to be relentless in learning and asking what things mean for investment,” she says.

Want to find out more about future proofing your career with the Investment Management Certificate? Sign up for a free webinar on 26th February 2019 – hosted in partnership with CFA Society United Kingdom and Kaplan.