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MBA in Finance Vs CFA

If you are trying to pursue a career in finance, there is a high probability that you are considering MBA in Finance or CFA as these are the leading career options for finance professionals. Both the courses are very rewarding and are recognized globally. This article will focus on various aspects of these courses to help you decide whether MBA or CFA will be best suited for you according to your career plans, interests, and the resources available with you. MBA in Finance vs CFA is a personal choice and there cannot be a clear answer to which is a better credential to possess. Many finance professionals pursue both the courses, extensively training them in various aspects of finance and management. However, there are differences between the curriculum, course structure and career prospects that you must consider while deciding MBA in Finance vs CFA.

MBA in Finance Vs CFA: Basic Differences

  MBA in Finance CFA
Eligibility Graduation in any stream Graduation in any stream, and
4 years of full-time experience
Exam Pattern Semester wise exams 3 Levels
Skills acquired Finance & Management skills Core Finance skills
Duration 2 years 2-4 years
Mode of study Full-time classroom based Rigorous self-study
Exam Pass rate More than 90% 40-47% for Level I & II,
50-56% for Level III
Offering Institution MBA colleges CFA Institute (USA)
Award for completion MBA Degree CFA Charter
Work experience required for obtaining degree/charter No 4 years in investment field

MBA in Finance Vs CFA: Introduction

MBA in finance is a two year full-time postgraduate program offered by Top MBA colleges in India. The program incorporates various basic and advanced courses of finance like Financial Derivatives, Global Securities Markets, Economics, Corporate Valuation, Securities Analysis, etc. Admission to MBA colleges is offered based on score of the applicants in entrance exams such as CAT, XAT, NMAT, etc. For details, click here. Personal interview, group discussions, profile-based scores are other factors considered by the leading B-schools in India.

CFA is a globally recognized designation offered by the CFA Institute. The course imparts core finance skills to the students. CFA curriculum includes topics such as Financial Reporting Analysis, Ethics in Investment, Portfolio Management, Asset Management, Financial Strategy etc. Candidates acquire extensive technical knowledge of finance and financial analytics. CFA charterholders are employed by top investment banks, asset managers and even accounting firms. CFA charter demonstrates dedication, ability, analytical skills, and ethical grounding required for several roles like portfolio managers, research analysts, risk managers, financial advisors, etc. There are many areas in the finance sector where CFA designation is a must.

MBA in Finance Vs CFA: Course Durations

MBA can be completed in two years. It is a full-time course. CFA, on the other hand has no defined duration. It is a self-study program. Therefore, it can be completed without quitting the job. This is the reason why many finance professionals pursue CFA while working in a full-time job. CFA exams are conducted in three levels. Candidates report investing an average of 300 hours of intense studying for each level. Average time taken to complete the CFA program ranges from 2-4 years. However, after passing all the three levels, to achieve the CFA charter, the candidates require 4 years of relevant work experience in investment related field.

MBA in Finance Vs CFA: Difficulty level

Both the courses are challenging and require intense amount of studying to fully understand the technical finance concepts. However, difficulty levels differ with respect to the syllabus, exam pattern and pass rates.

MBA in finance curriculum focuses on finance as well as management topics. Students also get an opportunity to learn several other aspects of business such as marketing, human resource, operations, analytics, etc. MBA exams are conducted by the respective B-schools according to their own criteria and more than 90% of the students pass these exams and achieve the MBA degree.

CFA exam is conducted internationally in a uniform pattern. There are 3 levels with pass rates ranging from 40-47% for Level I & II, and 50-56% for Level III. In the last 10 years, only 13% of students who appeared for Level I could make it through the final Level III. After passing all the three levels, the candidates need to acquire four years of qualified work experience to obtain the charter. Foe details on how to become a CFA charterholder, click here.

For MBA in Finance, entry barrier is high, but attrition rate is very low whereas for CFA, entry barrier is low, but attrition rate is very high.

MBA in Finance Vs CFA: Career Prospects

This is the most important factor that you should consider while deciding MBA in finance vs CFA. The focus of MBA is wide and hence it provides more opportunities in the domestic market for various roles that require finance and management skills. MBAs with specialization in finance are recruited for banking roles like corporate baking, investment banking, transaction banking, etc. They are also recruited extensively in corporate finance roles like treasury management, finance managers, working capital management, cash management, business valuation, etc. Other major finance roles include consultants, fund managers, analyst at rating agencies, risk managers, etc.

CFA charterholders are preferred in the international market for core finance roles like portfolio management, research, investment strategy, risk management, asset management, relationship and wealth management, etc. CFA charterholders help the clients in investment related decisions and provide services that enhance the financial markets. You can also click here to know more about CFA career prospects.

There are many new age roles that technologies like FinTech have opened for finance professionals. These jobs include quantitative analysts, managing lending platforms, blockchain developers, compliance experts, etc.

Careful analysis of the job profiles in top finance roles would be very helpful in choosing the right course as per your desired career prospect.

MBA in Finance Vs CFA: Affordability

The cost involved in pursuing MBA varies as per the colleges. Course fee in top B-schools of India can go up to INR 20 lakhs. Therefore, students must focus on the ROI before deciding whether to pursue MBA or not.

CFA charter is relatively affordable. One-time registration cost for the program is USD 450 and for all the subsequent levels, early registration fee is USD 700 and standard registration fee is USD 1,000. The entire program can be completed in USD 2,550 if early registration is done for all the levels and if every level is cleared in the first attempt.