CFA vs CMA
CFA® vs. CMA? The critical difference between CFA and CMA is the skills obtained. CFA focusses on enhancing Investment Management skills, including Investment Analysis, Portfolio Strategy, Asset Allocation, and Corporate Finance. CMA enables you to develop a level of expertise in both financial and management accounting and strategic direction.
Which credential is the right career choice for me?
I am sure you must have pondered on this question and asked around a dozen people as to which would be better for your finance career. This decision should only be yours. Surely you should do enough research and take necessary guidance, but eventually, it will be dependent upon which direction you wish to steer your career in.
Of course, you must be finding each of them interlinked as they both deal with the Accounts and finance domain, but both CFA® and CMA have their distinctive identity, and that is what you need to know. Once you are clear about what benefits each of them provides, you need to relate them to yourself and decide. This is similar to buying a product. When you go shopping, and you have various options for the product, you compare and find out what each of them offers. You also look at the cost that will be incurred and then quickly do a cost-benefit analysis. Finally, you decide as to which suits you better and what should be bought.
This is what we aim to do through this article on CFA® vs. CMA. We will look at both the credentials and guide you on which one is better for the features each one of them has to offer.
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We will discuss the following in this article –
- CFA® vs. CMA Infographics
- What is Chartered Financial Analyst (CFA®)?
- What is a Certified Management Accountant (CMA)?
- Why pursue CFA®?
- Why pursue CMA?
CFA® vs. CMA Infographics
What is the Chartered Financial Analyst® (CFA®) charter?
The CFA® Program focuses on investment management. The top employers of shareholders include the most respected financial corporations globally, e.g., JPMorgan, Citigroup, Bank of America, Credit Suisse, Deutsche Bank, HSBC, UBS, and Wells Fargo, to name a few. Many of these are investment banks, but the CFA® Program focuses on the knowledge and skills most relevant to the global investment management profession from the standpoint of a practitioner.
Investment professionals who hold the CFA®designation (or CFA® charter) meet rigorous educational, work experience, and ethical conduct requirements.
Only those who complete three graduate-level examinations, four years of work experience, and annual membership renewal (including ethics and code of professional conduct attestation) are permitted to use the CFA® designation. Complementary codes and standards (such as the Global Investment Performance Standards and Asset Manager Code) help enhance this professional distinction.
What is a Certified Management Accountant (CMA)?
- The CMA credential will make you a certified management accountant and will enable you to develop a level of expertise in both financial accounting and strategic management.
- CMA program was introduced in the year 1972 and has its value-add by specializing in cost accounting, financial analysis, and strategic planning.
- CMA is ideal for both accounting and finance majors who wish to work in the corporate world.
- This designation applies to those who are into cost and inventory accounting.
Why should you go for CFA® designation?
Top ten companies hiring CFA® include JP Morgan Chase, PwC, HSBC, Bank of America Merrill Lynch, UBS, Ernst & Young, RBC, Citigroup, Morgan Stanley, and Wells Fargo.
CFA® Institute has over 123,000 members in more than 140 countries and territories. 94% of members are CFA® charter holders.
- CFA® is required, particularly if you wish to get into equity research, investment banking, or portfolio management roles.
The differentiating benefits of earning the CFA® designation include:
- Real-world expertise
- Career recognition
- Ethical grounding
- Global community
- Employer demand
The sheer demand for the CFA® charter speaks to the difference it makes. More than 160,000 CFA® exam registrations were processed for the June 2015 exams (35% in the Americas, 22% in Europe, Middle East, and Africa, and 43% in the Asia Pacific).
For more information, refer to- CFA® Programs.
Why should you go for CMA?
CMA has over 70,000 IMA members and around 20-30K active CMAs.
Globally, CMAs earn 59% more in median salary and 63% more in median total compensation than their non-CMA peers.
The global median salary is $60,000, and the global median total compensation is $66,000
- This credential is designed to help you improve your ability to make strategic business decisions depending upon the financial situation of the company.
- The eligibility criteria are flexible, and hence the entry barrier is low.
- The CMA exam is designed so that it could be completed within a year as it has testing windows spread across 6 months in a year.
- The scope is narrowed down to learn about management accounting, specifically.
- Accounting is considered a necessity, and hence the demand for professional accountants is usually on the higher side.
Other Useful Comparisons
Weighing both these credentials, CFA® has more extensive market penetration and is more famous and comparatively tricky. Consider deciding to look at the remarkable careers each of these credentials has to offer and which you would enjoy more. Whichever certificate you go for will be an excellent investment. You would have to sacrifice the two most important things one is the most crucial, and secondly, the cost associated with the certification. Think about the pros and cons and choose wisely!
All the best! :-)