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Will CFA help in MBA admissions?

We are approached by many MBA applicants with queries related to the popular CFA certification. Some of them have already cleared CFA Level 1, 2 or 3 exams. Others are still in the process of thinking whether to start with it. Some are already working in finance roles, others are from unrelated fields (like engineering).

Some of the questions we get:

  • Is a CFA worth it? Should I go for it?
  • Is a CFA good for engineers?
  • How easy / hard is it to get a CFA?
  • Will my CFA help me during MBA applications?
  • Is CFA and MBA a good combination for jobs?

In this article, we cover these frequently asked questions about the CFA exam.

What is CFA?

For the uninitiated, the full-form of CFA is Chartered Financial Analyst. It is a professional accreditation accorded by CFA Institute headquartered in Virginia, USA.

As described by the official website, this is a self-study, graduate level program that equips candidates with advanced knowledge of various finance topics most notably on investment analysis and portfolio management.

In essence, it is something that can spell success or a foot-in-the-door for those seeking a career in the broader field of investment management.

CFA Exam structure, syllabus and logistics

Like out home-grown Chartered Accountant (CA) qualification, CFA too has levels – 3 in this case.

The Level 1 exams are conducted in June and December every year while for the subsequent levels, they are in June. Technically, one can complete the Level 1 in December, followed by the other two levels in consecutive June months making for a total duration of about 18 months. That is no mean task though (read next section).

As a pre-requisite to taking the exam, you either need 4 years of full-time professional experience OR a combination of education and work experience. In terms of education, they require a bachelor’s equivalent or a final-year student. This means that even those without much/any professional experience can take the exam.

To get an official CFA Charter though, it is required to have 4 years of full-time experience. This qualifies you for a formal membership to the CFA Institute with a caveat that at least 50% of your experience should be in investment decision-making roles (managing your own/family investments does not qualify).

The CFA syllabus covers 10 topics:

  1. Ethics
  2. Quantitative methods – statistical techniques/time value of money etc
  3. Economics – supply/demand/inflation etc
  4. Financial reporting and analysis – international accounting standards/debt etc
  5. Corporate finance – capital structure
  6. Equity investments – types of equity instruments/portfolio building
  7. Fixed income – fixed income securities / portfolio building
  8. Derivatives – forwards/futures/options etc
  9. Alternative Investments – real estate / Private Equity (PE) / commodities
  10. Portfolio management and wealth planning – this last part is the primary focus for Level 3 while the previous two levels have a more balanced distribution in terms of weights across all the 10 topics.


How difficult is the CFA exam?

The CFA program started somewhere in 1990 or so and as per the official website, there are only about 150,000 professionals globally who have the CFA credential. That looks like a fairly elite class to begin with. Let’s look at things a bit more microscopically though.

The pass percentage for level 1, 2 and 3 were 43%, 47% and 54% respectively. Those look pretty sizeable at the face of it. But if one multiplies them all, then the pass rate for all levels combined goes down to a lowly 11%.

To put this into perspective, though maybe not the best of comparison, the acceptance rate at Harvard Business School in 2017 was the same – 11% (and much lower at Stanford at 6%).

As per a 2017 new article, about 189,000 candidates took the test across all 3 levels. Some other sources put the number of candidates taking level 1 at about 90,000 and level 3 at about ~30,000 or so. You can do the math to get an approximate idea of candidates at each level but suffice it to say that the curriculum is tough and requires dedicated effort.

As per the official website, it requires 300 hours of study and about 2000 pages of curriculum for each level – that’s no mean feat by any standards!

Despite the effort, India has the 3rd highest number of test takers after US and China with Mumbai leading the pack from a local spread perspective. There are no figures of CFA charterholders by geography that we got hold of but assuming the previous pass % applies, one can expect a healthy population of CFA charterholders building up in the country.

Does CFA help in your MBA application?

Right, so now we get to the crux of this post. Does having a CFA add to your profile when applying to an MBA programs?

The answer, in more ways than one, is a fairly resounding yes. Over the years, the credibility, popularity and relevance of CFA has been increasing. The course content, at least from a theoretical perspective, mimics what one would learn in Finance courses during an MBA; in some cases, maybe even more advanced.

The vital difference being ‘theoretical’ – MBA programs score in making this a lot more real through case based pedagogy. A CFA charter usually indicates to the adcom that you are proficient with your financial basics, are good with numbers in general and have the potential to do well with the analytically intensive MBA curriculum – CFA curriculum as we already covered is fairly intensive too.

Some schools even go to the extent of waiving off the GMAT requirement the best known example of which is Rotman in Canada. The waiver is more common for masters in finance programs, the most famous amongst these being the one in London Business School where even a Level 1 can get you the waiver.

Is the CFA worth it?

Many engineers who aren’t in finance jobs go for CFA certification, hoping it’ll give their MBA (and career change plans after the MBA) a huge advantage. But is it really an effective or useful strategy?

Doing a CFA just to get some brownie points in your MBA application is unlikely to be a great idea. It is too much of effort for gains that are not necessarily documented or acknowledged.

In that sense, it is akin to volunteering just to get a tick mark in your application, without having any passion/interest in the field. More likely than not, you would end up not doing justice to the intended learning experience and may come out frustrated at the end of the process.

When it does make sense is if you are aiming for a career change – before and/or after MBA. Doing something like CFA is a clear indication to your potential recruiters (yes, adcoms too) that you mean business and you are willing to prove your interest into something you may not have done.

For investing related careers, it can only marginally complement an MBA with a Finance specialization. So, if you were wondering whether a CFA and MBA combination will get give you a big advantage while job hunting, you may be disappointed.

Another time when CFA could be a good thing, provided it meets your career aspirations, is to improve your academic profile. If for instance you are from a non-technical/analytical background, say an Arts major and/or your undergrad performance has been nothing great to write about, a CFA charter can add some gloss to an otherwise lacklustre academic evaluation.

Here’s one story of how a BCom graduate with CFA got multiple MBA admits with scholarships.

Also read:
CFA or MBA: Which is better for your career?
Build your profile for MBA
Resources: 1; 2; 3, 4; 5, 6

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Manish Gupta
About Manish Gupta
Chief Consulting Officer at MBA Crystal Ball, ex-McKinsey, IIT & ISB topper. MG can help you get into the top B-schools. Read more about this top MBA admissions consultant. Connect with MG on Email. Or follow on Linkedin, Facebook.

29 thoughts on “Will CFA help in MBA admissions?”

  1. Hello Sir,

    I’m second year MBA Finance student, need your guidance.
    I have been studying for CFA level 1 since February,2018 along with my 1st year MBA academics..but unfortunately I messed up with my MBA sem 2 & got an ATKT in 3 subjects (Operations, Research Methodology & Quantitative Techniques). And cleared these backlog & appeared for SEM 3 and got 2 ATKT (Corporate Finance & Financial Services).
    Now I’m not sure whether I should continue coaching for CFA level 1 or should I take a break from it complete my MBA n get placed and then resume back to CFA exam?

    Since my financial situation is weak I won’t be able to pay CFA level 1 fees (which amounts to approx.1 lakh)

    • Doing MBA with CFA is definitely a pretty tough bet Dhanu. Since you’ve tried it in two sems and don’t seem to be able to manage the load, it would be prudent to do one thing at a time instead of messing up both the things buddy.

      • Sir, Thanks for your reply.

        I would request you to suggest me some small certification in Finance.
        Which would be relatively effective & can be completed within 2 months period & serve my CV so that my chances of getting shortlisted for interview increases.

        My college placement activity will be starting from mid-August,2018.

        • No quick fixes per se Dhanu; plus not an area of expertise for us. You may want to do some relevant courses online pertaining to the sub-area within finance that you are interested in. Go for courses that have an exam and from good schools.

        • Hello Manish,

          I done my engineering in mechanical and working in tcs from last 4.5 year and have cleared my CFA level 2 and NCFM Certification(Basic)from NSE india and looking for FRM level 1. And right now preparing for GMAT mainly looking for executive program by IIMA B C and ISB.

          Can you suggest me something on this.

  2. I have completed my graduation in economics hons and I am interested in pursuing CFA so kindly advice me on it whether it is beneficial for me or not?

    • It depends on what you want to do Umang. If you are seeking a career in finance (ER/portfolio mgmt), then the CFA can certainly help. To what extent and how, that would depend on your overall profile too – not just the CFA alone eventually.

  3. Sir,

    I am an ACCA Affiliate. I did my professional chartered Accountancy degree simultaneously with Bachelors in Economics. I am currently working in Standard Chartered as an officer of Financial Reporting and Expense Management. Its been 1 year 6 month. I will get ACCA Membership after completing 3 years of work experience.
    I want to purse an MBA/Masters in Finance from a very reputed university. But the problem is, My Economics bachelors CGPA is not that high (2.87/4). I have applied for Msc programs this year, they all emailed me about my CGPA not good enough, and suggesting me to get a very high score in GMAT.
    I also intend to pursue CFA after I get in to Masters in Finance/MBA course.
    My question is,
    1. Will my ACCA help in my Masters of Finance/MBA application? I want to explore the investment banking sector.
    2. Should I pursue CFA like I planned (simultaneously with my MBA/Masters in Finance) and focus more on GMAT right now? Or I should complete Level 1, to add more value to my MBA/MFin application?

    With the Hectic office hours it is getting really hard to focus on studies

  4. sir i graduated ( hons) this year and appeared for CAT. expected percentile i howering around 90-91. Looks like i wanna give another shot next year. Meanwhile i want to add some certifications to my profile too. Clearing CFA Level 1 might be the option. Can you suggest some other options to me right here ?
    eagerly waiting for your reply

    • Hello sir, I’m a CFA level 2 candidate aspiring for ms in finance in US or Canada. I have close to 2 years of experience in IT (Cognizant) with an Asset Management client. I have gap of more than a year after my IT experience as I was preparing for some other exams and CFA. So will it be wise to do ms finance ? Also how can I positively portray the gap if it can affect my chances?
      Thanks in advance.

  5. Hi

    I have 3+ years of experience in IT Research (Report writing), including 1 year of experience in IT Consulting support. However, I have an MBA in Finance. Do we need any kind of experience before completing CFA to get the certification??

  6. @Sabbir – It would be prudent to try and do CFA as well as GMAT before the MBA/MSc. Those will help you pull up on the academic front. Tough to manage yes, but take a few years. Most good GMAT based MBA programs expect 4-5 years of solid professional experience. So you have time.

    @Anuj – doing certifications generally or to kill time is not a great idea. CFA or anything else, the choice should be dictated by your career preference. Not a great idea to dish out generic advice am afraid.

    @ Ranjit – no experience is required for CFA.

  7. Hello Sir,

    I am going to graduate this year and I am waiting for the final selection results of IIM Indore which will be out by April end. I also wish to pursue CFA (December 2019) and I wanted to know if it is possible to manage an MBA with CFA? Historically, have people been able to manage these two together?

  8. Hello Sir,

    I’m Dhanu from our previous conversation dated 5th July,2018.

    Sir further to my query is that now I have cleared all backlog and got MBA placement with Kotak Mahindra Bank LTD as profile of *Relationship Manager* (into Retail Liabilities & Branch Banking).

    My queries are:-

    1) Whether CFA knowledge would helping me in Relationship Manager profile application perse or through any sort of manner ?

    2) In order to get Charter one requires to Clear all 3 levels + 4 yrs of relative work experience in to investment profile.
    Does RM profile suffice to get Charter ?
    Or is it that there is no link between the two?

  9. @Daksh – it’s tough but yes, many manage that balancing act!

    @Dhanu – CFA isn’t likely to be of a lot of relevance for an RM profile. It is more apt for investment management/trading profiles.

  10. Hello Sir,
    I am a Civil Engineer and currently working as Assistant Manager – Fix Assets Valuation in a RBSA Advisors LLP. Before this job I was in construction industry as project engineer. My total working experience is 5.6 years at present.

    And I am preparing for the CFA L-1 Exam. Will it help to get good high in my career?
    Will if help in my profile to get the admission in ISB Mumbai in Weekend MBA Program while continuing my job in Mumbai after clearing CFA Level-1?

    Thanks & Regards,

  11. Hello sir,
    I have graduated in and now pursuing for CFA as I have interest in equity research,portfolio manager. My profile is not so good as my marks in +2 and graduation are not so great. Will MBA in finance help me in improving my profile and attaining more knowledge in this field or shall I do any other course as CFA alone has not that great value.

  12. Sir..i have completed my graduation. And now I want to make my career in cfa but i want to do cfa from usa please sir help me that how can i take admission in usa for cfa

  13. Greetings Sir
    I have just completed my degree in civil engineering and I am currently working in a reputed core company.

    I wanna diversify myself in MBA Finance. Since you said , CFA would be very beneficial in the early stages of the career. Will it be of any benefit to complete CFA Level 1 and then proceed with MBA? Will it be a smooth path in the transition phase?

    Also, will it provide me with a better placement prospects during my MBA?


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