Transcript CFA Program Overview
Are You Smarter than a NEW CFA Charterholder?
CFA Society of Minnesota Michael G. McMillan, PhD., CFA, CPA
Four Virtues of the CFA Charterholder
ETHICS TENACITY RIGOR ANALYTICS
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May 2009
Total CFA Registrations & Members
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May 2009
New Candidate Enrollment
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June 2009 Exam Results
128,506 registered candidates from 163 countries; 104,116 sat for the exam
182 exam sites worldwide in 89 countries
19% no-show rate (10-year average of 25%)
Overall pass rates (weighted average 45%) 46%: Level I (44% avg. from 1964-2009) 41%: Level II (49% avg. from 1964-2009) 49%: Level III (64% avg. from 1963-2009) Page 5
Charterholders and Candidates
As of 22 March 2010, there are 139,701 candidates registered for the June 2010 CFA exam (all 3 levels) worldwide.
Over 62,000 candidates are projected to register for the December 2010 Level I CFA exam. Currently 11,637 Level I candidates are registered for December.
Canada 15,787 U.S.
54,650 Latin/South America 3,309
Candidate Enrollments
(December 2009 and June 2010 exams) 7
U.K
13,081 Korea 8,594 South Africa 2,846 P.R. China 22,387 Singapore 6,482 Hong Kong 10,028 Taiwan 2,568 Australia 5,148
2011 Registration/ Exam Change
Effective 1 January 2011, a valid
international travel passport will be required for CFA Program enrollment and exam registration. This will apply to all candidates.
This means that a passport will be required to register for the exam and to be admitted to the testing facility.
First CFA Exam, 1963
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Today’s CFA Exam
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The CFA
®
Program
A graduate level program that takes a generalist/foundations approach to investment analysis and portfolio management and emphasizes the highest ethical and professional standards for the investment profession. 11
A Practitioner Driven CFA Program Process
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The CFA Program Cycle
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Bodies of Knowledge
Global Body of Investment Knowledge Candidate BOK PWM BOK CIPM BOK Frontier (emerging) Page 14
Purpose of Practice Analysis Process
To ensure the continuous development of the Global Body of Investment Knowledge (GBIK) GBIK: The comprehensive outline of mainstream knowledge for the investment profession, encompassing an entire career – novice through expert – for both generalists and specialists.
To identify the relevant content for the CFA Program Candidate Body of Knowledge (CBOK) CBOK: The inventory of knowledge and responsibilities expected of the professional practitioner of investment management at the level of a new charterholder. It is the roadmap for the CFA curriculum development and is organized into four functional areas: Ethical and Professional Standards, Investment Tools, Asset Valuation and Portfolio Management.
CFA Program Candidate Body of Knowledge
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Ten CBOK Topic Domains
Ethical and Professional Standards Quantitative Methods Economics Financial Reporting and Analysis Corporate Finance Equity Investments Fixed Income Derivatives Alternative Investments Portfolio Management and Wealth Planning Investment Tools Asset Valuation Portfolio Management Page 17
Curriculum
The topic focus and learning focus differ at each level Level I Level II Level III Topic Focus Investment Tools Ethical Standards Asset Valuation Ethical Standards Portfolio Management Ethical Standards Learning Focus Knowledge Comprehension Application Analysis Synthesis Evaluation The curriculum at each level is organized into 18 study sessions Page 18
Principles of Curriculum Development Teach the knowledge and skills required of a generalist
• Identified in the Global Practice Analysis • Defined by CBOK and DUO
Select, develop and regularly review materials that:
• Are appropriate in a distance-learning environment for a global candidate base • Are clear and accurate • Contain numerous examples/problems with solutions
Avoid curriculum materials that are:
• Predominately empirical/historical in nature • Topical (current events oriented or survey articles) • Country specific and/or specialist in nature
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Custom Curriculum Custom curriculum gives us flexibility to: Publish only the pages of a reading that we wish to require Add pedagogy (examples, questions, problems) where needed Make improvements to readings based on practice analysis Update examples and scenarios to current environment Page 20
2009 Curriculum Changes
All MC and IS questions have 3 answer choices
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The fourth choice is often ineffective
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Exams are adequate samples of CBOK
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Time management is a factor in exam success but the primary objective is to determine mastery of the targeted KSA’s
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The Standard Setting process evaluates exam difficulty over time Page 21
2010 Curriculum Major Changes
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Increasing proportion of curriculum developed by CFA Institute
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Revision of Level I Equity Asset Valuation readings
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Revision of Level I and II Financial Reporting and Analysis Readings for IFRS and US GAAP changes
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Expansion of Private Wealth Management curriculum (Level III)
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Expansion of end-of-reading problem Page 22
Standard Setting
• The objective of Standard Setting is to determine the score that represents acceptable competence or mastery of the concepts • Conducted by independent psychometricians • Group represents member and candidate demographics • Each participant works independently to evaluate each exam question/answer • Average score = recommended MPS 37
The MPS Process
• CFA Institute Board of Governors (who are CFA charterholders) determines CFA Exam Minimum Passing Scores • Primary input is standard setting • Pass rate for each level is a residual determined by each level’s MPS • Since 1996, the Board has considered performance on Ethics for candidates in a narrow band around the MPS 40
Volunteer Opportunities
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Practice Analysis Curriculum Development Curriculum Review Exam Development Exam Review Grading Standard Setting Page 25
Chartered Financial Analyst
® A Symbol of Integrity and Professional Excellence Page 26