cfa ® program 1 chartered financial analyst ® a symbol of integrity and professional excellence ®

CFA® Program 1

Chartered Financial Analyst®

A Symbol of Integrity and Professional Excellence

®

CFA® Program 2

2006 CFA® PROGRAM

Sponsored by:

CFA® Program 3

Benefits of the CFA Program

Knowledge

CFA® Program 4


“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 association of financial professionals, the CFA Institute. It used to be just an American qualification. But explosive growth has made it, in effect, global currency.”The EconomistFeb. 26-Mar 4, 2005

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CFA charterholders or candidates in the CFA program are to be favored

Switzerland

http://www.ubs.com/e/index.html

CFA® Program 6

The Chartered Financial Analyst (CFA) designation is strongly preferred


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Respect and Credibility

Most common occupations of CFA charterholders

• CEO/Principal • Investment Counselor • Chief Investment Officer • Investment Firm Manager • Equity Analyst • Portfolio Manager • Fixed Income Analyst • Portfolio Strategist • Investment Banker • Sales/Marketing Professional

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Diverse Career Opportunities

Mutual Funds / Investment Companies 25%

Brokerage / Investment Banks 19%

Investment Management Counselors 14%

Commercial Banks / Trust Companies 13%

Consulting Firms 6%

Insurance Companies 5%

Other 18%

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Opportunity – Top 24 Employers

• Bank of America • Mellon Financial Corporation • Barclays • Merrill Lynch & Co., Inc. • BMO Nesbitt Burns, Inc. • Morgan Stanley • CIBC World Markets • Northern Trust Corporation • Citigroup • PricewaterhouseCoopers • Credit Suisse Group • Prudential Financial • Deutsche Bank • Putnam Investments • Fidelity Investments • RBC Financial Group • Goldman Sachs • Scotia Capital • ING Groep N.V. • State Street • J.P. Morgan Chase & Co. • UBS AG • Lehman Brothers • Wellington Management

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Earning Power – The CFA Premium

Non-Charterholders

CFACharterholders

The CFA Premium: US$48,000

Median Total Compensation for U.S.-based CFA Institute members with 10+ years experienceSource: 2005 Compensation Survey

$200,000

$248,000

Not to scale…

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Global Passport: The CFA Charter

Members’ and Candidates’ Locations

76,521 Members and 87,409 Candidates Worldwide*

United States & CanadaMembers: 56,211Candidates: 40,205

EuropeMembers: 9,516Candidates: 13,081

Asia & Mainland ChinaMembers: 627Candidates: 8,853

Latin AmericaMembers: 751Candidates: 1,479

Pacific AsiaMembers: 8,009Candidates: 19,819

Africa & Middle EastMembers: 1,407Candidates: 3,972

* as of June 2005

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Global Perspective

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International Recognition

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What is the CFA Program?

Rigorous Self-Study Program

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Three Levels and Three Exams

Level I – Knowledge and comprehension of fundamental investment tools and concepts

Level II – Application and analysis focused on asset valuation

Level III – Synthesis and evaluation of client needs and portfolio management issues

Ethical and professional standards are emphasized at every level.

Surveys reveal that successful CFA candidates spend, on average, in excess of 250 hours per level preparing for the examinations. There is no substitute for spending the requisite time mastering the curriculum.But, success on the CFA examinations is not merely achieved bycommitting the requisite hours.

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Grading


Practical, Relevant Education

Practitioners at every step of the process

CCC COE

Body of Knowledge

Curriculum

Practice Analysis

Examinations

Setting of Minimum Passing Score (MPS) by

CFA Institute Governors

Leaders in theInvestment Community

CCC: Candidate Curriculum CommitteeCOE: Council of Examiners

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Learning Tied to Current Practice: The Practice Analysis Survey

• Determines topics taught in the CFA Program

• 2005-2006 Survey now underway

• Involves investment practitioners worldwide: Regional Expert Panels and member surveys

• “What knowledge and skills are needed by an investment professional?”

• CBOK, curriculum, LOS and exams all based on what practitioners need to know

CBOK: Candidate Body of KnowledgeLOS: Learning Outcome Statement

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The CFA Course of Study

CFA Body of Knowledge™

• Ethical and Professional Standards

• Quantitative Methods • Economics • Financial Statement Analysis • Corporate Finance

• Analysis of Equity Investments • Analysis of Debt Investments • Analysis of Derivatives • Analysis of Alternative Investments

• Portfolio Management

Investment Tools

Asset Valuation

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40% Asset

Valuation

40%Investment

Tools

10%

10%

50%50%PortfolioPortfolio

Mgt.Mgt.

35%35%Asset

Valuation

5%

10%

50%Investment

Tools30%Asset

Valuation

15%

5%

The CFA Course of Study

Three Levels – Topic Areas

Approximate Percentage Breakdown

Level I Level II Level III

Investment ToolsAsset ValuationPortfolio ManagementEthics & Professional Standards

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Preparation for the CFA Exams

Self-Study Materials

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2006 Level I Primary Textbooks

Standards of Practice Handbook 9e (AIMR, 2005)

Quantitative Methods for Investment Analysis 2eDefusco, McLeavey, Pinto, & Runkle (CFA Institute, 2004)

Economics: Private and Public Choice 10eGwartney, Stroup, Sobel, & Macpherson (South-Western, 2003)

International Investments 5e Solnik & McLeavey (Addison Wesley, 2003)

The Analysis and Use of Financial Statements 3eWhite, Sondhi, & Fried (Wiley, 2003)

Fundamentals of Financial Management 8eBrigham & Houston (Dryden, 1998)

Investment Analysis and Portfolio Management 7eReilly & Brown (South-Western, 2003)

Fixed Income Analysis for the CFA Program 2eFabozzi (Frank J. Fabozzi Assoc., 2004)

Analysis of Derivatives for the CFA Program Chance (AIMR, 2003)

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SOFT/HARD COVER: SOFTBOUND VOL 1: 798 pages, VOL 2: 1150 pages, VOL 3: 816 pages, VOL 4: 1034 pages PUBLISHER: CFA INSTITUTE DATE PUBLISHED: JUNE 2005


2006 Level I Primary Textbooks

Beginning in 2006, the Level I Curriculum is modularized, with the relevant readings for each Study Session bundled with its topics and Learning Outcomes Statements.

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The CFA Examinations

2006 Exam Format

Multiple Choice

Item Set (Objective)

Constructed Response

(Essay)

Level I ●100%

Level II ●100%

Level III ●50%

●50%

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Graded with Great Care

• 350+ CFA charterholders gathered in Charlottesville in 2005 to grade the examinations

• Teams of practitioners and academics

• Rigorous and thorough process

• Consistency and fairness across all papers

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Historic Pass Rates

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

I II III

Pass Rates: 2005 Pass Rates: 1963-2004

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

I II III

36%

56% 55%

49% 52%

68%

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Registering for the CFA Program

Bachelor’s Degree Requirement

Bachelor’s

Master’s

Doctorate

Law

Candidates’ Highest Degree

66%Bachelor’s

31%Master’s

1%2%

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Three Ways to Register

• CFA Exam Date: June 3, 2006 (see signup deadlines)

• Register online at: www.cfainstitute.org

• Download forms from the CFA Institute website and register by mail

• Or Contact CFA Institute for a paper CFA exam registration and enrollment package

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CFA Charter Requirements

• Sequentially pass Level I, II, and III exams

• Have four years of acceptable work experience

• Provide professional references (Level III)

• Join CFA Institute as a member and apply for membership in a local CFA Institute society

• Submit professional conduct statement

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1st Year Program Costs – 2006

Approximate Costs for New Level I Candidates

Registration fee to enter CFA Program US $375Enrollment fee for Level I examination US $360Level I Curriculum (members’ and candidates’ price) US $350

Approximate Total Costs for Level I US$1,085

*Registration & Enrollment by 1st fee deadline.

**

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Important Deadlines

June 2006 Examinations (Levels I, II, & III)*

15 September 2005 – Early registration deadline

15 February 2006 – Second deadline 15 March 2006 – Final deadline

December 2006 Examinations (Level I only)*

17 March 2006 – Early registration deadline

15 August 2006 – Second deadline 15 September 2006 – Final deadline

* Check the CFA Institute website for the most

recently-announced dates.

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Important Deadlines

* Check the CFA Institute website for the most

recently-announced dates.

Received Received Receivedon or before on or before on or before15-Sep-05 15-Feb-06 15-Mar-06

Registration (first timecandidates only) US$375 US$375 US$450

Enrollment (all candidates) US$360 US$440 US$670

Total fee US$735 US$815 US$1120

2006 REGISTRATION AND ENROLLMENT FEE SCHEDULEfor June Examination Dates

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Scholarships for the CFA Program

Two Scholarship Programs

• Society Scholarships – Available for Any Level*– Awarded to qualified candidates by local CFA Institute Society– CFALA scholarship includes cost of review program and money

for books.– 15 December 2005 – Deadline for all forms to be received by

CFALA for Society Scholarshiphttp://www.cfala.org/cfmfiles/asp/scholarship.asp)

– 31 January 2006 – Final Deadline for all forms to be received by CFA Institute from the society(http://www.cfainstitute.org/university/overview.html)

• Student Scholarships – For New Level I Only*– Awarded by CFA Charterholders who are full-time faculty

members. Please check with your instructor for deadlines.

* Registration fees waived – candidate pays US$150 for enrollment

http://www.cfainstitute.org/university/overview.html

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CFALA Mission and Goals• Established in 1931, the CFA Society of Los Angeles (the Society)

is a network of investment management professionals in the greater Los Angeles area, CFA Society of Los Angeles is a member society of CFA Institute.

• The mission of the Society is to provide access to information, expertise and personal interaction to further members' professional development and to promote the value of the profession and the CFA designation.

The Society strives to fulfill this purpose as: • a local Forum bringing together people, knowledge and practical

experience • a respected Partner with other organizations for the purpose of

serving mutual interests and the meaningful exchange of ideas • a Premier Source for professional resources and development • a powerful Voice representing ethical standards of practice and the

interests and value of the profession.

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The CFA Society of Los Angeles currently has 1,773 members.

CFA Charterholder InformationPercent

CFA charterholder 78%Non-charterholder 22%15% of our members are CFA program candidates at some level

Industry Classifications PercentInvestment Company/Mutual Fund 29%Investment Management Counseling 24%Broker Dealer, Investment Banking 12%Commercial/Retail Banking, Bank Trust Departments 11%Consulting Firm 10%Other businesses including government, academic, and miscellaneous 9%Insurance Company 3%Corporate/Public Sponsor & Foundation/Endowment 2%

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Topical Programs• Current issues in the investment industry are presented at

luncheons or dinners throughout the Los Angeles area. Previous presentations include topics on Wealth Management, Time Diversification and Behavioral Finance.

Corporate Presentations• Corporate presentations to members are held as luncheons at local

downtown venues. Presentations have included Colgate-Palmolive, Tag-It Pacific, Sysco Corp., Boise Corp. and Novartis Inc., among many others.

Continuing Education Programs• Educational classes are available to members at a discounted rate.

Courses have included the Foundations of Investments, Fixed Income Analysis, and Hedge Fund Investments.

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Social Gatherings

• An open forum to meet with other members in the industry, and their families in a non-business environment. Events have included “A Night at the Hollywood Bowl” and Wine Tasting.

Being a member of CFALA has its rewards - we have hosted resume writing workshops and other career discussion panels for our members.

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Job Placement Listings• Members have access to employment opportunities in the Southern

California area via the subscription job listings on the CFALA website.

• It’s free for CFALA members - you just need to enter your User ID and password to access the site. Non-members pay a fee.

• The jobs featured are for internships and relatively new graduates, all the way up to senior manager and executive levels.

• As of 11/7/2005 there were approximately 100 jobs listed.

• Soon it may include listings for the Western United States.

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Annual Career Expo Usually takes place in late April and in 2006, we will be celebrating our 10th

anniversary!

The aim is to provide information about various career tracks and the many types of financial jobs that are open to people entering the industry.

One of the panel discussions relates to tips and strategies on how to start a career in the industry.

The main highlight for many folks who come to the Expo is our networking reception, where we have about 30 analysts, portfolio managers, financial advisors, bankers, consultants, trust managers, and recruiters available. This gives the audience a chance to ask questions and interact.

We have heard of success stories from members who have hired interns.

More and more, we are bringing in folks who are actively recruiting college level graduates.

We must be doing something right (or wrong) - a lot of folks in the Expo are repeat attendees.

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Basic Accounting For CFA Level I Candidates (2 Saturdays) Date: Saturday, January 7th and 21st, 2006 Time: 9:00 am - 1:30 pmCost: $125.00 for Members and $150 for Non-MembersLocation: USC (room to be determined)

The goal of this course is to help prepare the Level I CFA candidate for the accounting and financial analysis topics of the CFA exam.

Many CFA candidates have "rusty" accounting / financial analysis skills, or have never been exposed to these often puzzling areas via college courses or work experience.

The CFA program assumes a basic working knowledge of accounting and financial analysis for the Level I CFA exam.

Since the instructor for this course has also served as the instructor for the USC / LASFA CFA® Review program for several years, he understands how best to bridge this critical knowledge gap."

https://www.cfala.org/cfmfiles/cal/eventlist2.cfm?id=593&t=e&d=Z

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USC/CFALA CFA® Review Program

Since 1984, CFA Society of Los Angeles, Inc. (“CFALA”) in partnership with the University of Southern California, Marshall School of Business (“USC”) has offered CFA® Review Programs for each level of the CFA® Study and Examination Program.

In the Spring, we offer both Weekday and Saturday Review Courses for Level I and Level II and a Weekday Review Course for Level III candidates.

CFALA also offers a Saturday Review Course for candidates preparing to take the December Level I examination.

While live instruction is the cornerstone of our program, candidates are provided with supplemental study tools including a full-length practice examination, access to recorded classroom lectures via the CFALA website, and Schweser Notes and Schweser Pro software.

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Weekly Review Course: begins in January. Classes are held once a week and end in late May on the USC Campus.

I: Tuesdays starting January 3 (5:00-8:00 pm)II: Thursdays starting January 5 (5:00-8:00 pm) III: Wednesdays starting January 4 (6:30-8:30 pm)

Saturday Review Course (Levels I & II only): begins in January Will be held on 10 Saturdays before the 6/03/06 exam. Classes begin at 9:00 am and will end at 5:00 pm. (Lunch will not be provided.) First class sessions are schedule for Saturday, 14 January

Please note: if you miss a weekly class you can attend the Saturday class as a makeup and vice versa. All classes will be digitally recorded and posted online for review via ID and password.

Cost: $1299 Non-members, $1149 CFALA members. Register and pay by December 31, 2005 and receive a $100 discount.

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The registration fee for the Review Course includes: the Schweser Study Notes, Schweser Pro, the full length practice exam and access to online recordings of the Review Classes.

Mentor Program: Each Level I candidate may choose to be assigned a mentor (a CFALA member who is a CFA Charterholder) who will periodically provide support and answer questions regarding the candidates exam preparation. Candidates who wish to be assigned a CFALA Mentor please contact [email protected].

Text Book & Assigned Reading: Tuition for the USC/CFALA CFA Review Program does not include the cost of text books. All text material should be purchased before the start of class by using the order form in the back of your CFA Institute Study Guide. Class sessions will cover the material in your study guide but NOT NECESSARILY IN STUDY GUIDE ORDER. Please refer to the class schedule when preparing for class sessions. Candidates are expected to read and study the appropriate materials BEFORE each review session.

mailto:[email protected]

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Contact Us:

CFA Society of Los Angeles, Inc 555 W. 5th St., 31st Fl.Los Angeles, CA 90013Telephone (213) 627-1500Fax: (213) 947-4855Email: [email protected]

Web: www.cfala.org

USC/CFALA CFA Review Program 555 W. 5th St., 31st Fl.Los Angeles, CA 90013Telephone: (213) 627-1230Fax: (213) 947-4855Email: [email protected]`



CFA® Program 45

More Information About the CFA Program

www.cfainstitute.org

The AmericasP.O. Box 3668 Phone: 800-247-8132 or 434-951-5499560 Ray C. Hunt Drive Fax: 434-951-5262Charlottesville, VA 22903 E-mail: [email protected]

Asia-PacificSuite 3407 Phone: 852-2868-2700 or 852-8228-8820Two Exchange Square Fax: 852-2868-99128 Connaught Place E-mail: [email protected] Kong, SAR

Europe29th Floor Phone: 44-20-7712-1719One Canada Square Fax: 44-20-7712-1601Canary Wharf E-mail: [email protected] E14 5DYUnited Kingdom

CFA® Program 46


A Symbol of Integrity and Professional Excellence

®

cfa ® program 1 chartered financial analyst ® a symbol of integrity and professional excellence ®

Documents

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