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2004-2005 CFA® Program 1

2004-2005 CFA® PROGRAM

Sponsored by:


Chartered Financial Analyst®

A Symbol of Integrity and Professional Excellence

®


What is the CFA Program?

Rigorous Self-Study Program



Three Levels and Three Exams

Level I – Knowledge and comprehension of fundamental investment tools and concepts

Level II – Application and analysis focused on asset valuation

Level III – Synthesis and evaluation of client needs and portfolio management issues

Ethical and professional standards are emphasized atevery level.



Practical, Relevant Education

Practitioners at every step of the process



Learning Tied to Current Practice

• Determines topics taught in the CFA Program

• Conducted every five years: next in 2005-2006

• Involves investment practitioners worldwide: Regional Expert Panels and member surveys

• “What knowledge and skills are needed by an investment professional?”

• CBOK, curriculum, LOS and exams all based on what practitioners need to know


Benefits of the CFA Program

Knowledge



Respect and Credibility

Most common occupations of CFA charterholders

• CEO/Principal • Investment Counselor • Chief Investment Officer • Investment Firm Manager • Equity Analyst • Portfolio Manager • Fixed Income Analyst • Portfolio Strategist • Investment Banker • Sales/Marketing Professional



Diverse Career Opportunities

Mutual Funds / Investment Companies 25%

Brokerage / Investment Banks 19%

Investment Management Counselors 14%

Commercial Banks / Trust Companies 13%

Consulting Firms 6%

Insurance Companies 5%

Other 18%



Opportunity – Top 24 Employers

• Bank of America • Mellon Financial Corporation • Barclays • Merrill Lynch & Co., Inc. • BMO Nesbitt Burns, Inc. • Morgan Stanley • CIBC World Markets • Northern Trust Corporation • Citigroup • PricewaterhouseCoopers • Credit Suisse Group • Prudential Financial • Deutsche Bank • Putnam Investments • Fidelity Investments • RBC Financial Group • Goldman Sachs • Scotia Capital • ING Groep N.V. • State Street • J.P. Morgan Chase & Co. • UBS AG • Lehman Brothers • Wellington Management



Earning Power – The CFA Premium

Non-Charterholders

CFACharterholders

The CFA Premium: US$40,000

Median Total Compensation for CFA Institutemembers with 10+ years experienceSource: 2003 Compensation Survey

$163,000

$203,000


Global Passport: The CFA Charter

Growing Non-US Numbers

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000

45,000

1990 1993 1996 1997 1998 1999 2000 2001 2002 2003

AsiaCanadaEuropeOther



Members’ and Candidates’ Locations

68,378 Members and 129,389 Candidates Worldwide*

United States & CanadaMembers: 52,058Candidates: 65,726

EuropeMembers: 7,492Candidates: 19,373

Asia & Mainland ChinaMembers: 610Candidates: 6,899

Latin AmericaMembers: 457Candidates: 2,125

Pacific AsiaMembers: 6,608Candidates: 29,777

Africa & Middle EastMembers: 1,153Candidates: 5,489

* as of December 2003



Global Perspective



International Recognition


The CFA Course of Study

CFA Body of Knowledge™

• Ethical and Professional Standards

• Quantitative Methods • Economics • Financial Statement Analysis • Corporate Finance

• Analysis of Equity Investments • Analysis of Debt Investments • Analysis of Derivatives • Analysis of Alternative Investments

• Portfolio Management

Investment Tools

Asset Valuation


40%

40%

10%

10%

50%

35%

5%

10%

50%

30%

15%

5%

The CFA Course of Study

Three Levels – Topic Areas

Approximate Percentage Breakdown

Level I Level II Level III

Investment ToolsAsset ValuationPortfolio ManagementProfessional Standards


Preparation for the CFA Exams

Self-Study Materials



2005 Level I Primary Textbooks

Standards of Practice Handbook 8e (AIMR, 1999)

Quantitative Methods for Investment Analysis 2eDefusco, McLeavey, Pinto, & Runkle (CFA Institute, 2004)

Economics: Private and Public Choice 10eGwartney, Stroup, Sobel, & Macpherson (South-Western, 2003)

International Investments 5e Solnik & McLeavey (Addison Wesley, 2003)

The Analysis and Use of Financial Statements 3eWhite, Sondhi, & Fried (Wiley, 2003)

Fundamentals of Financial Management 8eBrigham & Houston (Dryden, 1998)

Investment Analysis and Portfolio Management 7eReilly & Brown (South-Western, 2003)

Fixed Income Analysis for the CFA Program 2eFabozzi (Frank J. Fabozzi Assoc., 2004)

Analysis of Derivatives for the CFA Program Chance (AIMR, 2003)



Valuable Learning Experience


The CFA Examinations

2005 Exam Format

*Beginning in 2005, Level II exams will be 100% item set.

Multiple Choice

Item Set (Objective)

Constructed Response

Level I ●100%

Level II* ●100%

Level III ●50%

●50%



Graded with Great Care

• 750+ CFA charterholders in 2004

• Teams of practitioners

• Rigorous and thorough process

• Consistency and fairness across all papers


0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

I II III


Historic Pass Rates

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

I II III

Pass Rates: 2004* Pass Rates: 1963-2004*

34% 32%

64%

50% 52%

68%

*Level I totals do not include results for the December 2004 exam.


Registering for the CFA Program

Bachelor’s Degree Requirement

Bachelor’s

Master’s

Doctorate

Law

Candidates’ Highest Degree

66%

31%

1%2%



Three Ways to Register

• Register online at: www.cfainstitute.org

• Download forms from the CFA Institute website and register by mail

• Contact CFA Institute for a paper CFA exam registration and enrollment package



CFA Charter Requirements

• Sequentially pass Level I, II, and III exams

• Have four years of acceptable work experience

• Provide professional references (Level III)

• Join CFA Institute as a member and apply for membership in a local CFA Institute society

• Submit professional conduct statement



Connecting with a Local Society



1st Year Program Costs – 2005

Approximate Costs for New Level I Candidates

Registration fee to enter CFA Program US $375Enrollment fee for Level I examination US $360Study materials for Level I:

• Study Guide Free• CFA Institute publications US $268• Primary textbooks US $427

Approximate Total Costs for Level I US$1,430

*Registration & Enrollment by 1st fee deadline.

**



Important Deadlines

June 2005 Examinations (Levels I, II, & III)

15 September 2004 – Early registration deadline15 February 2005 – Second deadline 15 March 2005 – Final deadline

December 2005 Examinations (Level I only)

17 March 2005 – Early registration deadline15 August 2005 – Second deadline 15 September 2005 – Final deadline


Scholarships for the CFA Program

Three Scholarship Programs

Student Scholarships – For New Level I Only*Awarded by CFA charterholder full-time faculty

members

Faculty Scholarships – Available for Any Level*Awarded to full-time faculty directly by CFA Institute

Society Scholarships – Available for Any Level*Awarded to qualified candidates by local

CFA Institute society

* Registration fees waived – candidate pays US$150 for enrollment


Scholarships for the CFA Program

Important Deadlines

• Scholarship Applications

14 January 2005 – Faculty and society sponsorssubmit final list of scholars to Scholarship Office

31 January 2005 – Final Deadline: all forms receivedby CFA Institute

• Scholarships apply to June 2005 exam only

• No scholarships currently available for December 2005


More Information About the CFA Program

www.cfainstitute.org

The AmericasP.O. Box 3668 Phone: 800-247-8132 or 434-951-5499560 Ray C. Hunt Drive Fax: 434-951-5262Charlottesville, VA 22903 E-mail: [email protected]

Asia-PacificSuite 3407 Phone: 852-2868-2700 or 852-8228-8820Two Exchange Square Fax: 852-2868-99128 Connaught Place E-mail: [email protected] Kong, SAR

Europe29th Floor Phone: 44-20-7712-1719One Canada Square Fax: 44-20-7712-1601Canary Wharf E-mail: [email protected] E14 5DYUnited Kingdom


Chartered Financial Analyst®

A Symbol of Integrity and Professional Excellence

®

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