The aim of this Buzzle article is to help you understand the facts related to the salary and job description of a Chartered Financial Analyst (CFA). So, keep reading to know more.
According to PayScale, those who are only CFA charter holders are likely to make $27,000 more than people who only have an MBA, and $13,000 more than people who only have an MBA in Finance.
The job of a chartered financial analyst mainly consists of giving correct investment suggestions to their clients. There are many chartered financial analysts who work for renowned brokerage firms. Their salary is generally high as compared to several other professions for the simple reason that these professionals are highly qualified, and handle important responsibilities in their place of work. Most CFA holders work in investment related firms as financial analysts. They are usually hired for money or portfolio management. They can work as Financial Advisors, Chief Executive Officers, Chief Investment Officers, Investment Bankers, and for a variety of other similar prosperous professions.
It usually takes 3.5-4 years to complete the entire CFA program. Getting a CFA degree is much cheaper than getting an MBA degree from a well-known school. As CFA holders have exceptional analytical skills, they are in demand in hedge funds, private equity firms, and bulge bracket banks like Bank of America Merrill Lynch, Barclays Capital, Goldman Sachs, etc. Those who have successfully completed both CFA and MBA programs earn the highest.
▸ According to the Bureau of Labor Statistics (BLS), the median annual wage for financial analysts was $76,950 in May 2012.
▸ According to the BLS, employment of financial analysts is projected to grow 16% from 2012 to 2022, faster than the average for all occupations.
▸ According to PayScale, the median salary for those who have just entered this field is US$ 57,191 per year. With around one to four years of experience, you can easily earn around US$ 67,000 per year. The increase in earnings could be fast for graduates from reputed business schools.
▸ With an experience of five to nine years, you can earn about US$ 92,708 per year.
▸ The chief financial officers of large companies can expect salaries in excess of US$ 148,000 per year.
▸ The median salary of a CFA holder working as a portfolio manager is $104,554 p.a.
▸ Those working as equity analysts take home about $94,000 annually.
▸ For those working in J.P. Morgan Chase & Co. (JPMCC), the salary figures can be in the range of US $41,459 to US $104,045. In The Goldman Sachs Group, Inc., you can earn anything between US$ 53,829 – $204,257 annually. The annual salaries offered by the Northern Trust Company are in the range of US$ 73,083 – $179,473.
* Source: PayScale
The average earnings of a CFA largely depend on their experience, educational qualification, position in the organization, type of employer, and location of job. Chartered financial analysts working for multinational financial services and brokerage firms earn much more than their counterparts working in smaller firms. Financial analysts who work in large metropolitan cities are bound to earn more than those working in relatively smaller cities. Financial analyst salary range can change as per the economic growth. Top banking and finance firms in New York, Texas, California, Illinois, Massachusetts, Pennsylvania, and Washington are the major recruiters for CFA graduates.
Apart from the fixed salary, such highly placed finance professionals also earn from bonuses, stock options, incentives, and attractive perks. However, this is a variable component of their earning, and can change depending on the situation in the market.
▸ Chartered financial analysts conduct a thorough research on the investment options such as stocks and bonds of companies. They track the stock prices of companies of different sectors. Financial services, banking, oil and gas exploration, pharmaceuticals, media, and metals are the sectors which these financial analysts track closely. They research on a particular sector, and suggest investment in companies in that sector.
▸ Chartered financial analysts also study the history of stock prices of a company so that they can come up with right buy or sell recommendations for their clients.
▸ The aim of their job is to help their clients earn maximum profits, and hence, these analysts make them aware of the dangers and risks in the stock market.
▸ Once their research is over, they prepare an investment report, and submit it to their clients and their stock brokers. By discussing every point in the report systematically, clients can make transactions in stocks of companies to get decent capital gains.
▸ Financial analysts also suggest investment in bonds which are actually loans given to corporates for a long-term.
▸ A sense of financial management is a must for these analysts.
In order to become a certified financial analyst, you should complete your graduation in accounts, commerce or finance. A post-graduate degree from a renowned university can make your resume very strong. Degree holders in subjects such as mathematics, economics, and statistics can also enter this field. Generally, chartered financial analysts have to undergo in-house training at their workplace as a trainee before they are made permanent.
This information will guide you well, and help you explore career opportunities in this field of finance. So, work hard for a better future!