Should I take the CFA for a career in asset management?

Whether you should take the CFA depends on what type of funds you are targeting. Generally speaking, having a CFA is useful if you are aiming for traditional asset managers that invest in long-only equity and debt, but if you are shooting for long/short hedge funds, then the CFA is not looked at much.

I think there are two reasons for this difference.

Traditional asset managers focus on asset gathering and marketing since they charge a flat management fee and don’t have a performance fee. The amount of assets a firm manages solely determines its revenues.

Credentials matter, and they matter a lot in marketing your fund to grow the fund’s AUM. Wealth advisers look for the CFA as a sign that your investment team has strong analytical abilities.

The second reason is that hedge fund analysts tend to be younger.

The industry has developed a mindset that instead of spending 3 years to study for 3 exams, one could use that time to look at stocks and generate alpha. Some hedge fund PMs are vocally negative towards the CFA — they want hungry analysts who are laser focused on making money for the firm and clients.

In general, these PMs care less about folks with MBAs and CFAs. They think these credentials make analysts more expensive for having less direct investing experience.

Author Kelvin Jiang, CFA

Kelvin Jiang has a decade of investment experience in public equities, private equity, distressed debt, and leveraged finance. His journey spans across Calamos Investments, Thornburg Investment Management, CHS Capital, and J.P. Morgan. Throughout his career, Kelvin has screened and interviewed candidates extensively for the buy side. Kelvin earned an M.B.A. from the Kellogg School of Management and graduated magna cum laude from Columbia University. He is a CFA Charterholder. In his spare time, Kelvin is an avid commentator on NBA trade rumors and Oscar-worthy performances.

More posts by Kelvin Jiang, CFA

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