Quote:
Originally Posted by theJuice
Hey guys, kind of a random question, but how important is a CFA in regards to being an Portfolio Manager? I'm not really too knowledgeable regarding alot of the titles in the finance world, but is it potentially a cause for concern or not really. I fall into the perhaps foolish view that having one as opposed to not having one simply means somebody is more qualified/better educated etc. Typically, I would have thought its always preferred. I will admit that when I was originally looking, that I thought it seemed more like a bare minimum that they needed to have, and not something that would set them apart from the other potential portfolio managers. Again, maybe I'm mistaken, and that it is something more important for financial advisers who I think are those who tell me how to spend my money/make plans for saving etc, whereas the PM is more doing the actual investing help?
I was discussing this with a friend, and the viewpoint they had was that my Portfolio Manager was more of a, I dunno, customer relations guy I was dealing with. Somebody I'm meeting once a year to kinda go over my plan, talk with briefly for like 15 minutes, and then never really speak with again for about a year. That they are not really "doing" most of the stuff behind the scenes, and thus in my case, them not having a CFA is not really that big of a deal.
I will say that it is at one of the main banks, and the account is a fairly large one with more than a million.
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In short, having the CFA designation is
very important in becoming a licensed portfolio manager. It's written right in the ASC's proficiency requirements to manage money.
However I was a bit confused by your post. The CFA designation is the "gold star" of the investment management world. That said, CFA charterholders don't have expertise in financial planning, estate planning, budgeting, life insurance, etc. other than the basics. CFPs are more equipped to build an overall wealth plan for you, and CFA charterholders have expertise in managing your investments (like you pointed out). It's truly a practitioner investment management designation. It is notoriously difficult to get, harder IMO than any other finance-related designation and also harder than an MBA or Masters in finance (because they will hand hold you through the program and you will graduate as long as you pay). I am biased for sure, but I think it's pretty well known if you ask around (even people with other designations).
The person you are dealing with at the bank is probably a business development/account rep/salesperson, who deals with clients, raises funds and markets product. The question is who is giving you advice on your portfolio? If it's this person, then absolutely they should have a CFA designation (or a combination of other designations + many years experience). Your friend saying that it's not important for that person to have investment proficiency may or may not be correct. If they're the one giving you investment advice and constructing your portfolio, then your friend is wrong.
This all depends though on what type of account it is? Are the securities pooled funds or a discretionary account with individual securities? Who is making the policy decisions on your asset allocation? Who is managing the actual securities? Are you directing them at all?