It has been an eternal debate whether one should take MBA or do CFA. Binod Shankar, CFA, Managing Director of Genesis Institute explains the advantages and features of each.

1. CFA
vs
MBA:
The
Eternal
Debate
Binod
Shankar
15
April
2010

2. CFA®
PROGRAM
It's
a
self-­‐study,
graduate-­‐level
program
for
investment
professionals.
• Level
I
–
Knowledge
and
comprehension
of
fundamental
investment
tools
and
concepts
• Level
II
–
Applica@on
and
analysis
focused
on
asset
valua@on
• Level
III
–
Synthesis
and
evalua@on
of
client
needs
and
porColio
management
issues
Ethical
and
professional
standards
are
emphasized
at
every
level.
wwww.genesisreview.com 2 Innovative Financial Education

3. CFA®
PROGRAM
Relevance
• Prac@ce
analysis
to
define
curriculum
• Principles
relevant
in
every
market
around
the
world
Rigor
• Work
experience
requirement
(4
years)
• Only
19%
complete
the
en@re
3-­‐exam
program
• Great
equalizer
RecogniLon
• CFA®
Charter
recognized
globally
wwww.genesisreview.com 3 Innovative Financial Education

4. CHARTERED
FINANCIAL
ANALYST®:
BENEFITS
AND
CAREERS
Most
common
occupa@ons
of
CFA®
Higher
charterholders:
CompensaLon
• CEO/Principal
Access
to
Global
InternaLonal
• Chief
Investment
Officer
Network
RecogniLon
• Investment
Counselor
• Investment
Firm
Manager
Knowledge
with
• PorColio
Manager
Respect
Global
• PorColio
Strategist
PerspecLve
• Equity
Analyst
• Fixed
Income
Analyst
Credibility
• Investment
Banker
wwww.genesisreview.com 4 Innovative Financial Education

5. TOPIC
AREA
WEIGHTS:
A
GUIDE
Topic
Area
Level
I
Level
II
Level
III
Ethical
and
Professional
Standards
15
10
10
Quan@ta@ve
Methods
12
5-­‐10
0
Economics
10
5-­‐10
0
Financial
Repor@ng
and
Analysis
20
15-­‐25
0
Corporate
Finance
8
5-­‐15
0
Investment
Tools
50
30-­‐60
0
Equity
Investments
10
20-­‐30
5-­‐15
Fixed
Income
Investments
12
5-­‐15
10-­‐20
Deriva@ves
5
5-­‐15
5-­‐15
Alterna@ve
Investments
3
5-­‐15
5-­‐15
Asset
ValuaLon
30
35-­‐75
35-­‐45
PorTolio
Management
and
Wealth
Planning
5
5-­‐15
45-­‐55
Total
100
100
100
wwww.genesisreview.com 5 Innovative Financial Education

6. FRESH
CURRICULUM
• The
curriculum
is
reviewed
regularly
through
a
Global
Prac@ce
Analysis
• On
an
annual
basis,
the
curriculum
is
reviewed
to
test
whether
it
reflects
the
knowledge,
skills
and
abili@es
required
of
an
investment
prac@@oner
with
4
years
of
experience
• This
review
is
done
by
groups
of
employers,
experts
and
also
based
on
a
survey
of
CFA®
charterholders
• As
examples,
Private
Wealth
Management,
Behavioral
Finance
and
Private
Equity
were
all
added
in
the
last
2
years
• This
focus
on
keeping
the
curriculum
fresh
makes
a
charterholder
much
more
aware
of
business
reality
and
definitely
increases
his
value
wwww.genesisreview.com 6 Innovative Financial Education

7. STEPS
TO
EARN
A
CFA®
CHARTER
1
Sequen@ally
pass
level
1,
2,
and
3
examina@ons
2
At
least
4
years
of
investment
profession
experience
3
Join
CFA
Ins@tute
as
a
regular
member
4
Apply
for
membership
in
a
CFA
Ins@tute
Society
(CFA
Emirates)
5
Comply
with
CFA
ins@tute
condi@ons,
requirements,
policies
and
procedures
wwww.genesisreview.com 7 Innovative Financial Education

8. MBA
BASICS
• MBA
courses
are
highly
varied
in
dura@on
,
content
etc.
Typical
dura@on
ranges
from
1
to
2
years
• Year
1
at
Harvard
MBA
(Finance)
covers
:
marke@ng,
opera@ons
mgt,
OB,
financial
repor@ng,
strategy,
leadership
• Year
2
covers
:
Value
inves@ng,
consumer
finance,
financial
markets,
strategic
finance,
investment
management,
private
equity,
real
estate,
venture
capital
• MBA
is
a
broad
course
and
its
not
very
deep
or
technical
wwww.genesisreview.com 8 Innovative Financial Education

9. GETTING
IN
-­‐
CFA®
EASIER
TO
GET
IN.
BECOME
A
CANDIDATE:
1. Fulfill
the
entrance
requirements.
At
the
@me
of
enrollment
you
must:
• Have
a
U.S.
bachelor’s
(or
equivalent)
degree
Or
be
in
the
final
year
of
your
bachelor's
degree
program
(Note:
educa@on
informa@on
must
be
updated
before
progression
to
Level
II)
Or
have
four
years
of
qualified,
professional
work
experience
Or
a
combina@on
of
work
and
college
experience
that
totals
at
least
four
years.
(Note:
summer,
part-­‐@me,
and
internship
posi@ons
do
not
qualify)
• Meet
the
professional
conduct
admission
criteria
(during
the
applica@on
process,
you
will
be
asked
to
sign
statements
of
Professional
Conduct
and
Candidate
Responsibility)
• Be
prepared
to
take
the
exams
in
English
2. Sign
up
for
your
first
exam.
Registering
for
the
first
exam
also
enrolls
you
as
a
candidate
in
the
CFA®
Program.
This
requires
a
one-­‐@me
program
enrollment
fee
in
addi@on
to
the
exam
registra@on
fee.
wwww.genesisreview.com 9 Innovative Financial Education

10. GETTING
IN
-­‐
MBA
1. London
Business
School
(UK)
2. University
of
Pennsylvania
:Wharton
(US)
3. Harvard
Business
School
(US)
4. Stanford
University
(US)
5. Insead
(France/Singapore)
6. Columbia
Business
School
(US)
7. MIT
Sloan
School
of
Management
(US)
8. University
of
Chicago:
Booth
(US)
9. IESE
Business
School
(Spain)
10. Indian
School
of
Business
(India)
Conclusion:
Incredibly
difficult
to
get
in.
Requires
proper
qualifica@on
+
related
work
experience
+
a
very
good
GMAT
score
(
700
+)
Source:
FT
Global
MBA
Rankings
2010
wwww.genesisreview.com 10 Innovative Financial Education

11. COST
ANALYSIS
–CFA®
V/S
MBA
(All amounts in US Dollars)
CFA®
MBA
from
a
top
school
Registra@on
and
exam
fees
for
all
3
levels:
2,000
(assuming
you
pass
in
the
first
aoempt)
Total
esLmated
cost
:
100,000
Prep
course
fees
:
10,000
vs This
excludes
the
cost
of
travel
to
home
and
back.
Total
cost
:
12,000
Also
excludes
the
cost
of
not
working
for
2
years!
wwww.genesisreview.com 11 Innovative Financial Education

12. HOW
UNIQUE
IS
IT-­‐CFA®
The
CFA®
charter
is
rare.
The
CFAI
limits
the
number
of
CFA®
charterholders.
Even
a^er
40
years,
there
are
just
78,000+
charterholders
globally!
In
2009,
6,628
people
got
the
valuable
CFA®
charter
GET
DISTINGUISHED!!
“Whereas
there
are
tens
of
thousands
of
finance
degrees
available
around
the
world,
ranging
from
the
excellent
to
the
worthless,
there
is
only
one
CFA®,
managed
and
examined
by
an
American
associa@on
of
financial
professionals,
the
CFA
Ins@tute.
It
used
to
be
just
an
American
qualifica@on.
But
explosive
growth
has
made
it,
in
effect,
global
currency.” -­‐
The
Economist,
26
Feb-­‐4
Mar
2005
“The
big
aorac@on…is
[that]
the
CFA®
[charter]
qualifica@on
becomes
a
second
passport,
an
interna@onal
gold
standard.” -­‐
Financial
Times,
22
May
2006
wwww.genesisreview.com 12 Innovative Financial Education

13. HOW
UNIQUE
IS
IT
-­‐
MBA
• There
are
thousands
of
colleges
issuing
MBA
degrees
• There
are
part-­‐@me
MBAs,
Execu@ve
MBAs.
Even
online
MBA
degrees
• The
best
colleges
are
of
course
unique
• George
Bush
had
an
MBA
from
Harvard!
wwww.genesisreview.com 13 Innovative Financial Education

14. WHAT
YOU
GET
-­‐
CFA®
• A
CFA®
teaches
hard
skills
and
tests
you
on
them.
• The
CFA®
goes
deep
and
trains
you
to
be
very
good
at
specific
jobs.
Such
as
research
&
asset
management.
CFA®
is
hard
core!
• A
CFA
is
an
excellent
route
into
asset
management.
The
CFA®
is
of
huge
importance
in
the
asset
management
industry
• Each
of
the
three
CFA®
exams
requires
250
hours
of
study
in
your
own
@me.
That
shows
true
commitment.
• A
CFA®
provides
the
tools
to
develop
crea@ve
solu@ons
to
complex
financial
problems
wwww.genesisreview.com 14 Innovative Financial Education

15. WHAT
YOU
GET
-­‐
MBA
• An
MBA
teaches
sow
skills.
• MBA
courses
offer
an
introduc@on
to
financial
theory
• An
MBA
is
more
broad
than
it
is
deep.
It
gives
you
a
big
picture
view
• An
MBA
doesn’t
go
deep
into
investment
valua@on,
analysis
or
porColio
management
like
CFA®
• An
MBA
is
more
for
investment
banking
or
business
in
general.
It's
the
standard
educa@onal
background
on
Wall
Street
• An
MBA
offers
contacts
and
networking
• An
MBA
gives
you
a
pres@gious
brand
name
to
market
yourself
with
wwww.genesisreview.com 15 Innovative Financial Education

16. THE
FUTURE
OF
ASSET
MANAGEMENT
• Past:
the
money
came
from
the
Middle
East
but
was
managed
by
asset
managers
in
the
US
and
Europe
• Current:
Money
s@ll
comes
from
the
Middle
East
but
increasingly
managed
in
the
Middle
East:
ü ABU
DHABI
INVESTMENT
AUTHORITY
ü ABRAAJ
ü ABU
DHABI
INVESTMENT
COUNCIL
ü INVESTMENT
CORPORATION
OF
DUBAI
ü KUWAIT
INVESTMENT
AUTHORITY
ü DUBAI
INVESTMENTS
ü QATAR
INVESTMENT
AUTHORITY
ü DUBAI
INTERNATIONAL
CAPITAL
ü EMIRATES
INVESTMENT
AUTHORITY
ü INVEST
AD
ü MUBADALA
ü NATIONAL
BANK
OF
ABU
DHABI
ü STARLING
GROUP
ü MASHREQ
BANK
ü ISTITHMAR
ü SHUAA
CAPITAL
ü ITHMAR
ü RASMALA
INVESTMENTS
IMPLICATION:
MORE
LOCAL
FUND
MANAGEMENT=
MORE
DEMAND
FOR
FUND
MANAGERS=
MORE
DEMAND
FOR
CFA®
CHARTERHOLDERS!
wwww.genesisreview.com 16 Innovative Financial Education

17. DO
MBAS
MAKE
BETTER
LEADERS?
• As
of
2006,
a
full
39%
of
all
Fortune
500
CEOs
held
an
MBA,
with
62%
holding
some
kind
of
advanced
degree
• But
you
may
be
shocked
to
learn
that,
based
on
a
2006
study
from
BusinessWeek,
shareholder
returns
of
companies
led
by
CEOs
with
MBAs
were
significantly
worse
than
of
those
led
by
non-­‐MBA
CEOs
• Look
at
business
leaders
such
as
Jeff
Bezos
at
Amazon.com
(Nasdaq:
AMZN),
Fred
Smith
at
FedEx
(NYSE:
FDX)
• You
quickly
realize
that
being
an
excellent
CEO
has
almost
nothing
to
do
with
having
an
advanced
degree
from
a
top
business
school!
wwww.genesisreview.com 17 Innovative Financial Education

18. SO
WHAT
TO
DO?
wwww.genesisreview.com 18 Innovative Financial Education

19. SUMMARY/SOLUTION
• The
MBA
is
difficult
to
get
into
but
easier
to
pass
out
of.
The
CFA®
is
far
easier
to
get
into
but
undeniably
tough
–only
19%
get
the
Charter
• MBA
is
far
more
expensive
and
requires
full
@me
study.
CFA®
offers
incredible
value
for
money
and
can
be
completed
on
a
part
@me
basis
• CFA®
is
an
essen@al
qualifica@on
in
asset
management
and
research.
MBA
is
more
prominent
in
investment
banking
&
general
business
• Whether
you
should
seek
a
CFA®
,
an
MBA,
or
both
has
everything
to
do
with
your
professional
goals
It
all
depends
on
each
student
and
what
he
or
she
would
like
to
do
wwww.genesisreview.com 19 Innovative Financial Education

20. Thank
You!
Binod
Shankar
CFA
Genesis
Ins@tute
Knowledge
Village
Block
8,
Office
F19,
Dubai,
UAE
T
:
+971
4
438
0267
E:
bshankar@genesisreview.com
www.genesisreview.com