Finance on your finger-tips, pronto

Nelson Lacy

There are basically three common concerns that obstruct the growth of finance graduates. Firstly, that the curriculum isn’t adequate to prepare them for the industry. Secondly, students get discouraged when they think that they aren’t capable enough of standing out in the crowd. Third, the most common concern — Should I consider an MBA next?

The third question has changed over the period of time and there have been certain updated MBA programmes that are worth considering. The worth of an MBA is declining today from what it was two decades ago. Applications are dropping, tuition fee is up, more and more programmes are shutting down, and most importantly, the very notion of the value of a generalist degree in business is being questioned, giving way to replacements offering a concentrated curricula and sharper focus.

As the landscape of university degree programmes has shifted, so have the choices available for finance students looking to build their human capital. And here the news is good. Those eyeing to enhance but also streamline their learning would be smart to consider professional designations that are designed to provide what millennials want most — relevant knowledge presented in a way that’s easy to access, has short duration, is relatively inexpensive, and at the end builds-out your resume. 

What designation(s) are best for you to pursue? Try this: google "top professional finance designations" and see what comes up.  For example, according to the Corporate Finance Institute, the leading six designations, in alphabetical order, are 

Chartered alternative investment analyst

The CAIA Association is globally recognised as the credential for professionals managing, analysing, distributing and regulating alternative investments, defined through different asset classes given by hedge fund trading strategies, private equity investment opportunities.  With respect to general characteristics, these asset classes typically occupy the north-east corner of the risk premium curve, appealing to high net worth investors seeking both return enhancement and diversification. CAIA Charter holders must pass two levels of exams and cost about $2,500, and successful exam candidates that hold a bachelor's degree must also have one year of relevant work experience.  The CAIA designation is relatively new - the Association began in 2003 -- and in a relatively short amount of time has awarded over 10,000 Charter holders globally.  

Chartered Financial Analyst

The Chartered Financial Analyst designation confers the CFA Charter to candidates who pass three levels of exams and meet work experience requirements. The curriculum is built from the CFA institute body of knowledge covering areas of traditional finance such as financial analysis, equity and fixed income security analysis, economics, portfolio theory and analysis and professional standards and ethics. 

The examinations can be completed in as few as 18 months with the typical candidate taking four years at an average total cost of about $3,000. The CFA designation has achieved explosive popularity in India with a record of just short of 22,000 candidates having registered for exams in June of 2018.  

ICAI

The Chartered Accountant of India designation is a degree conferred to qualified accountants in India.  The ICAI curriculum covers subjects such as quantitative aptitude, economics, law and all areas of accounting.  It takes a minimum of four years to complete the three levels of exams (entrance, intermediate, and final), although many candidates spend longer amounts of time, with an average total cost of about $600.  The ICAI is the most popular designation in India and has membership of about 250,000, about evenly split between practicing and non-practicing CAs.

Financial Modeling and Valuation Analyst

The Financial Modeling and Valuation Analyst designation programme provides applications of accounting, financial management, valuation, and modelling skills.  Students must successfully complete courses and demonstrate mastery of the topics through completion of the course materials, quizzes, and assessments.  The cost of the designation is about $750.

Certified Financial Planning

The Certified Financial Planning designation is awarded to individuals holding a bachelor's degree from an accredited university and who completes coursework in financial planning.  The curriculum is broad, covering areas such as insurance, investments, tax, estate and retirement planning.  The CFP designation requires all candidates to pass one exam that costs about $1,000, while also requiring a three year work experience requirement in India.  There are less than 100,000 CFPs globally, with estimates for India difficult to estimate.

Financial Risk Management

The Financial Risk Management designation is issued by the Global Association of Risk Professionals (GARP) to candidates successful in passing a two-part exam and who meet a work experience requirement in risk management.  The program follows the major strategic disciplines of risk management including quantitative analysis, models, and risk management in areas such as market,credit, operational, and measurement risk.  At a cost of about $1,500, there are about 30,000 certified FRMs globally.

—The writer is Director of Examinations, CAIA Association