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Studying for CFA exam a lengthy, tedious task

(ran SP NP TP PT editions)

Preparing for the Chartered Financial Analyst exam, a sweeping test that covers nearly every aspect of financial markets from accounting and financial statement analysis to derivatives and ethics, can take months.

David Ackerman has prepared for a Chartered Financial Analyst exam and trained for a marathon, and he's not sure which was harder.

Both required intense concentration, personal motivation and huge sacrifices of time. Both were physically and mentally exhausting. And both were completely worth it, Ackerman said.

Just as Ackerman did between 1992 and 1995, money managers and other finance professionals began preparing in January for the June CFA exam, a sweeping test that covers nearly every aspect of financial markets, from accounting and financial statement analysis to derivatives and ethics.

Finance workers said preparing for the test is one of the toughest things they've ever done, but it's worth it, because in finance and investing circles, CFAs are highly respected.

"The trick is juggling the hours it takes to study with all other commitments you have in your life and commitments to your job," said Ackerman, a partner at Dallas Investment Management and president of the Dallas Association of Investment Analysts. "On weekends, you're taking your backpack and going to the library, trying to get a quiet place to study. By the end of six months, your wife is just saying, "Please let it end.' "

Ackerman was single when he studied for the CFA exam and didn't have to worry about asking a spouse to pick up the slack. Bill Ketterer, portfolio manager for Bank of America's capital management group, is married with two children. While he studied for the exam each spring from 1998 to 2000, his wife had to take on extra duties at home.

"She jokes about being a CFA widow," Ketterer said. "It's really hard for anybody who doesn't have a financial background to understand why I was doing all that studying, so I just had to explain that this is what I was trying to accomplish."

Ketterer did his best to spend time with his children and do his homework, sometimes simultaneously.

"I did a lot of games with kids," he said. "I had a big white board, and my 5-year-old would draw pictures on it to try to help me remember different theories and different concepts."

The rewards came quickly for Ketterer. Participants take the exam in three levels, one each year.

After passing level one in 1998, Ketterer was hired at Bank of America from a reimbursement consulting job at a local health care company, a considerable step up.

Though he has completed level three, Ketterer is still waiting to receive the designation, which is awarded by the Association for Investment Management and Research, because of a technicality. The association is revising its rules about which professions qualify for the designation.

His quick move up in the job ranks is not surprising, according to statistics from the association.

In 1999, CFAs earned an average of $125,000, compared with $116,000 for non-CFA charter holders in the same professions.

Though CFAs concede their title is not widely known outside financial circles, the exam is getting more popular. The number of enrolled candidates for the exam rose 27 percent from 1999 to 2000. In 2000, 71,999 candidates were enrolled for the exam, nearly triple the number enrolled in 1995.

Men outnumber women 3-1 in CFA exam enrollment, but David Wiley, who runs a company that prepares people for the exam, said he's seeing more women in his classes than he used to.

CFA candidates also are diversifying in terms of industry, said Wiley, partner at JKE Exam Review Inc.

"Typically, a person coming out with the designation might go to work for a bank, an investment bank or a securities firm," he said. "But we've had accountants, real estate people, anybody in a complex financial industry."

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