Indians are determined to pursue the CFA charter

'Indians are determined to pursue the CFA charter'

How many Indian students apply for the CFA Programme every year? Has it increased/ decreased over the past few years?
In fiscal year 2009, India ranked fourth with the number of registrations for the CFA exam rising to nearly 14,500 (including those who gave level I exams in December and level I, II and III students in June 2009). A record 5500 students are registered for the level I CFA exam to be held in Mumbai on December 6, 2009. Despite the uncertainty for Indian candidates seeking the CFA designation over the last few years, the number of registrations from India has increased steadily. This growth shows how determined Indian candidates are to pursue the CFA charter.

What are the CFA Institute's plans in India?
Currently, the CFA Institute has 108 CFA Programme partners worldwide, with 25 in the APAC Region. Once the legal situation in India is resolved, we look forward to partnering with strong Indian finance programmes. We have signed a MoU with the Securities and Exchange Board of India's National Institute of Securities Markets (NISM) in June 2009 to jointly organise financial and investment educational training programs and research in India. We have already held a journalist training, exam development training, and a workshop on derivatives. We also hope that, barring legal constraint, we can establish an office in India to support our candidates and members on the ground in the future.

How do you see the role of the CFA evolving in today's dynamic world?
While the skill and knowledge base of CFA charterholders, the investment tools and applications they use, may be evolving according to the changing market needs and new financial innovations, their primary role has not and will not change. It is essentially to act at all times in the best interest of investors, placing investors' interests before their firms', and before their own.


Broadly speaking, CFA charterholders study markets, trends and stocks, and analyse them to provide insightful opinions on buying or selling companies/stocks and even make investment decisions. Sameer Bakhru, Managing Partner, Pan Venture Consultants gives us more insight. "Essentially they can work on the buy side or sell side, valuing, selling or creating investments for companies or investors," he says.

Buy side refers to a group of people who buy into investments. They include mutual funds (such as Fidelity, Franklin Templeton), which buy into listed companies and private equity funds (such as Chrys Capital, Baring) that buy into unlisted companies.

Sell side refers to companies that sell investments to other companies or individuals, or manage client accounts. These may typically be investment management companies or brokerage outfits (that sell stocks to investors) such as HDFC Securities, ICICI Securities or India Bulls.

Core finance division/ treasury departments of MNCs also hire CFAs who would manage the company's existing cash assets via short and medium-term investments in the treasury. In the M&A division, he/she would evaluate acquisition/takeover targets, and manage them during the M&A process.

One could be working as an analyst researching companies in a particular sector (say telecoms), valuing them and zeroing in on the target share price of the companies. An analyst's role revolves around valuation of the companies he targets -- the higher the expected share price viz the current price, the greater are the returns expected out of investing in that company, Bakhru adds.

Investment managers study listed companies (if they work in a mutual fund) or unlisted companies (if they work in a PE fund). They manage a certain sum of money on a regular basis and take buy and sell decisions in the stock market. Wealth managers/relationship managers guide investors on what investments to make and operate independently or work with large private banks such as Citibank or HSBC.

There are only about 400-500 CFA (USA) charterholders in India. The number looks set to rise with 5,500 students registered for the December level I exam. The qualification is being increasingly sought for its credibility, specialisation and the global recognition that comes with it, though it is tough to attain it. With the global economic downturn receding, market sentiments picking up and the financial sector set to regain its momentum, the future surely looks bright for CFAs in India.