CFA( Chartered Financial Analyst) is considered to be one of the most preferred and highest-earning professions in finance-related domains, in the present scenario. This article focuses on a complete analysis of, scope of CFA and Salary in India. Considering the handsome money this profession provides once you complete your degree, it contains an abundance of logic and complex concepts that requires dedication and utmost concentration. The topics include probability, statistics, calculus, investment, portfolio management, economics, security analysis, investments, Corporate Finance, and etc. Students belonging to Chartered Financial Analysts can expect to work in the given domains;
• Risk Management
• Research analysis
• Business Analytics
• Accounting and Finance
• Investment Banking
• Portfolio Manager
• Financial Advisor
The path to becoming a CFA Charter holder consists of 3 level exams
• Level 1, that includes portfolio management techniques, asset valuation, financial reporting, and analysis.
• Level 2, that includes quantitative methods in asset valuation.
• Level 3, which includes equity, derivative investments, asset valuation models.
A huge crowd of people tries to settle their career in it with having a proper clarification about. Often, the lack of information makes them feel stuck in it. Data suggests that 43% of applicants were actually able to crack all of these exams. Furthermore, you need to have a bachelor’s degree to apply for them. And to become a qualified expert, you need at least 4 years of experience in the investment field.
An individual who successfully attains the degree is known as the ‘CFA Charter’ and is often hired by top consulting firms such as JP Morgan, Goldman Sachs, Royal Bank of Canada, and Morgan Stanley.
In this article, our sole aim is to dive inside the salary prospects if you choose to work as a CFA or CFA average salary. First, let us look at the few factors that affect the salary of every employee, not only CFA salary.
• Industry Condition
When you work in an industry, your salary will depend on the profit the industry is making. If the industry is not earning well, no matter how much effort you put in, they won’t pay you more and it will affect the CFA salary.
CFA salary also depends on the area you live in and what effects globalization has on it. Globalization is the trade within regions that affects businesses.
People become unemployed because they don’t have relevant skills which will ultimately help you to grab a job with relevant skills.
• Demand in a particular area
CFA salary also depends on the fact how many professionals are in demand or how much the company is willing to pay considering the development in that area.
The total salary of an employee consists of Basic Pay, Cash Bonus, and equity.
The following CFA salary analysis is given on the basis of inspecting this profession with different factors instead of comparing it with every profession existing.
It has often been noticed that even after acing such a complex degree, students tend to land up in low job packages due to a lack of on-field experience. The degree teaches you various concepts about probability, statistics, calculus, investment, portfolio management, economics, security analysis, investments, Corporate Finance, and etc. These skills are irrelevant if you don’t know their implications in the most creative way. When you start working in an industry, you come across a huge amount of challenges and risks that give you the ability to deal with them. Data suggests that there are high chances of getting a high salary once you reach your mid-career. Earning a huge amount of experience in this field is again challenging. Since so many individuals tend to make their career in this field, competition is high. In the present scenario, only 6.1% of CFA graduates in India are consistent and have the utmost level of experience that improves their CFA salary. Statistics suggest that some people do switch to another field due to their diverse interests and dedication that this field asks. Your competition will eventually become less if you are consistent in your field. The average CFA salary is usually high as there are only a few experienced experts available. The experts perform a variety of tasks and are paid heavily. A fresher might start with the package of around 4 lakhs which can be improved up to 15-20 lakhs with an apt amount of 5-9 years experience.
Another aspect that will determine the CFA average salary is the job type. Graduates can work in a variety of profiles with a CFA degree. The major profiles we will be considered are given below:
• Portfolio manager
• Financial Analyst
• Research Analyst
• Chief executive
According to statistics, the portfolio manager makes the highest income among the other profiles. The job of the portfolio manager is responsible for developing strategies and implements for investment purposes. Data by the CFA institute in 2018 suggest that almost 22% of CFA charter holders work as portfolio managers in different industries. Next comes the profile of the Research Analyst, which earns the second-highest among the other profiles of CFA charter. The job of a Research analyst is to present and interpret data for marketing, economics, and customer-related decisions. Globally, there are almost 15-16% CFA charters working in the profile of a Research Analyst. The average CFA salary for chief-level executives fluctuates from year to year considering it to be a diverse profile. Some candidates work as Chief financial officer while some as a chief investment officer. Therefore, it is hard to say about the increase and decrease in the CFA salary of this profile. Only 7% of the CFA Charter ends up being Chief Executive according to data by the CFA Institute. Many other profiles like Risk Managers, Consultants, Auditors, and Advisers also exist but their basic pay fluctuates depending on the experiences and industries you are working in. These factors will be covered in this article below.
The CFA salary of the candidate is highly affected by the area he/she is living in while working in a particular area. Compensation is the money or bonuses that are given to the employees apart from basic salary. Employees living in cities with a high cost of living are often paid a huge amount of compensation as compared to people living in small cities. Globally, it is highly expensive for you to live in a city like New York as it has a comparatively high cost of living. In India, CFA charters make less money as compared to candidates in the USA. Popularity in a particular area plays a vital role. The CFA role is considered to be less popular in the UK as compared to the US. Most of the CFA charters work in New York, despite the high cost of living and lesser compensation. In India, it is observed that the salary growth is lowest as compared to other developed countries like the US and UK but is enough depending on the cost of living.
The type of industry in which a CFA charter works highly affects CFA average salary. The following are the industries in which the CFA charter usually works:
• Insurance and Financial Services
• Wealth Management
• Investment services
It is often noticed that the CFA average salary in different industries has very minor differences. But if we still compare that in a broader spectrum, the CFA institute suggests that CFA charter working in Insurance Services and Banking industries are paid higher as compared to other industries. Professionals have a huge workload in these industries, therefore they are paid higher. Due to the high pay scale and quality work, there is a huge amount of competition among different candidates. There is not much CFA salary difference within industries like wealth management and investment services. CFA charters are highly paid in those fields also. Just a slight difference makes insurance and banking, the most rewarding profiles. CFA charters working in these industries have their salaries almost equal to CFA average salary.
Students from various backgrounds tend to start their careers as a CFA charter. The most common degrees are given below.
• MBA Finance
Before jumping into their salary breakdown and bonuses, let us consider two aspects. In this section, we’ll mention a) increase in salary after attaining a particular degree b) CFA salary to initiate.
Candidate, after completing an MBA finance starts with a huge salary package as compared to other degrees. Students, belonging to BA, BSc, and other under-graduate courses start with a small package but as they gather experience and knowledge, their pay scale reaches as high as that of an MBA graduate. It is often noticed that students belonging to BA background in India possess higher prospects of an increase in salary as compared to other degrees. Comparing MBAs and BBAs and others is irrelevant as both the backgrounds will land you up to an almost similar platform after an experience of 4-9 years. In these aspects, the average CFA salary remains similar, it might fluctuate depending on the candidate’s skills and the company’s demand.
So, the detailed analysis that we did about the CFA average salary considering every factor suggests a lot of conclusions. Being a CFA charter will never disappoint you as it not only pays you well but also exposes you to so many complex concepts that make your brain logical and sharp. If one loves to deal with complex logic every day, this can turn out to be a dream career for you.
As analysis clearly suggests, having an experience adds a lot of weightage to your career and helps you in grabbing a high package. Having legitimate experience regardless of whichever background you belong to, will help you to land up in your dream job. Even students with MBA in Finance tend to start their career in Chartered Financial Analysis.
No matter which industry you work in, for a CFA salary you will be paid according to your experience, skills, and demand by the company.
It has also noticed that the number of experienced professionals affects the CFA average salary of a particular profile. For example, candidates working as profile managers earn the highest as compared to other profiles considering only a few experienced portfolios managers are available globally. Most of the candidates end up becoming a research analyst.
Experience and industry you are working in have an immense effect on your salary and growth. The finance industry is the core field of a CFA charter. Chartered Financial Analysis is a tough task to crack and ace. Within a statistical frame, Chartered Financial Analysis is an appropriate choice for those who are finance enthusiasts and love to deal with complex data every day. Moreover, candidates who have the patience to acquire a good amount of experience in this particular field. Usually, a huge crowd of people tries to settle their career in it with having proper clarification about it. Often, the lack of information makes them feel stuck in it.
While preparing for CFA, you might encounter so many doubts that remain unanswered. For that, an online platform Chegg becomes extremely important for students where you can get answers to all of your doubts from experts around the country. All you have to do is, go on the website and register. Ask your doubts with experts with impressive academic records and experience.
There is no field better than others, everything depends on your interest and creativity. Everything you do, you are only expected to be good at it instead of opting for something fancy out of interest and never being good at it.
Hope this article answers ‘how much money you can make with a CFA.
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