CFA for trading job

Howdy,

I've just turned 22 and have been a salestrader/broker for over a year now, covering US stocks and equities and derivatives. Even though it's the biggest bank in region, we are a small shop by world standards. I hope to finish my business school (wrong choice for becoming a trader, I know by now) by spring 2012, when I would have 2+ years of experience. I have decent math skills and passion for this (even co-writing colleagues master thesis, doing CDS pricing).

I am determined to move to a trading job eventually, now what's this forum's take on a CFA for trading? I would try to do it in June'12 (within my final year). I thought that as I don't come from fancy Ivy-league school, it would help getting the foot through the door. But so far, as I've talked to traders, their opinions vary pretty much...

Just in case, I am still talking about trading jobs in banks, would take it from there I guess. Not propshops or arcades.

it sounds like you are talking about being a buyside trader, if that is the case, do something else. In 5-7 years or less, buyside trading will be, at most, a clerical job. There is next to no need to have people (particularly highly paid ones) doing that job. Avoid buy side trading, floor brokerage etc as you will be looking for a new career before you hit your 30's.

Don't think its worth it. The CFA comprises so much more than understanding securities that its really not tailored for a traders job. Will it hurt? probably not, but its really far more useful for portfolio managers and research analysts.

Originally Posted by Quadcammer

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Don't think its worth it. The CFA comprises so much more than understanding securities that its really not tailored for a traders job. Will it hurt? probably not, but its really far more useful for portfolio managers and research analysts.

+1. Don't see much application of, or demand for that designation in trading.

Originally Posted by coolpapaboze

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+1. Don't see much application of, or demand for that designation in trading.
I did some work for an energy companies trading department (traded spot and future electricity). All the traders on the floor, were just chumps, many barely obtaining B.Admin degrees, and a few failing many of their courses.

The people I worked with, in the "back office", doing forecasting and risk assessment had the MBA's and CFA's.

My own CFA is now looking quite elderly, and I am thankfully away from most of what constitutes "trading."

But from my own observations, the CFA program is a better signalling and filtering device than a source of knowledge or actually useful professional contacts. If you are from a good MBA program, there isn't much in the charter that can't be picked up pretty quickly. Obviously, there are a few items like ethics where you just have to learn it their way. But accounting, stats, fixed income risks, derivatives... all better learned from good professors over a period of time than as a cram course before three single exams. And after school, from talented professionals who will teach you what you need to know for your work.

That being said, it's probably worth knowing roughly where the state of the art is for the people who will be interviewing you. And if you're switching careers, having made some headway in the CFA is good evidence that you're serious about the field and not a total idiot.

[Skepticism helps, of course. When I was taking my exams, there were still articles in the syllabus praising real estate to the skies for its equity-like returns, low volatilities, and low correlations to everything else. And at least one piece explaining why high-yield debt was a fantastic thing for S&Ls to know about.]

Another advantage to doing it now-- the exams are usually held right after Memorial Day and it's better to screw up that weekend before you have a wife and kids.

It seems pretty tough for anyone (MBA, CFA, etc.) to get into trading if they didn't get in at the analyst level. Even in decent business schools, < 10 per class end up with an actual trading job and not research, market risk, strats, modeling, structuring roles, etc.

In the fall, I talked to a staffer of a major BB and she said that she actually sought to avoid MBA's as they have a sense of entitlement that didn't align with the trading culture.

Summary: CFA probably won't help if you already have an MBA. Furthermore, if you have spare time there are probably more effective uses of your time (networking, clubs, etc) that would get you closer to your goal.

Originally Posted by newinny

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In the fall, I talked to a staffer of a major BB and she said that she actually sought to avoid MBA's as they have a sense of entitlement that didn't align with the trading culture.

Did she mention what they were looking for?

For associate roles, they promote from within 90% of the time.

n.b. an mba friend of mine did get a summer internship as a trader in an NY BB, but he's a rare example, networked harder than any human being alive, and was a trader at a regional firm before school

Originally Posted by Egert

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what's this forum's take on a CFA?

essentially worthless. but not expensive

-a CFA

Bear in mind, that I don't have a MBA, I will graduate with a BA next spring and have 2 years working @ desk by then. Thinking of doing CFA on a final year

Originally Posted by scientific

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essentially worthless. but not expensive -a CFA
Can you expand on this? I'm having a quarter life crisis. I don't know wether to pursue a CA (Canadian version of CPA) or a CFA.

Originally Posted by Stazy

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Can you expand on this? I'm having a quarter life crisis. I don't know wether to pursue a CA (Canadian version of CPA) or a CFA.
I couldn't imagine putting in the time and money to get a CA designation. Between the CFA, and CMA, I'm pretty sure you could do better - unless all you want to do is audit's and tax returns that is. http://www.greystone.ca/ This is one of the companies I'm going to be spending a lot of time trying to get a job with .. one thing I notice .. is a lot of CFA's on staff, and little of any other designation.

Originally Posted by imschatz

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I couldn't imagine putting in the time and money to get a CA designation. Between the CFA, and CMA, I'm pretty sure you could do better - unless all you want to do is audit's and tax returns that is. http://www.greystone.ca/ This is one of the companies I'm going to be spending a lot of time trying to get a job with .. one thing I notice .. is a lot of CFA's on staff, and little of any other designation.
That's the thing...I don't want to be an accountant but I know the designation is well respected. The number of CEOs with a CA designation is trending upwards & I've had a few corporate executives recommend it to me. That being said, if a CFA puts me in just as competitive of a position, I think I'd be more inclined to pursue it instead.

Originally Posted by Stazy

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That's the thing...I don't want to be an accountant but I know the designation is well respected. The number of CEOs with a CA designation is trending upwards & I've had a few corporate executives recommend it to me. That being said, if a CFA puts me in just as competitive of a position, I think I'd be more inclined to pursue it instead.

The CA desgination has its pro's/con's. It's geared mainly to financial reporting/auditing; however, can be leveraged in to finance. I found having allowed me to at the very least get interviews for IB positions and was viewed favorably by the big canadian banks.

The pro's include resume building, getting great work experience (long hours, working in teams, tight dealines, building financial acumen, etc). The only down side is you'd always be going in as an off cycle hire as banks typically prefer their new analyst/associate positions filled by recent grads. It also gives you a back up career option in the case you can't get into IB. I am speaking for my experiences only and in the Canadian market alone (CA isn't worth a damn in the US as nobody knows what the hell it is).

Cheers.