CFA vs CMT

Difference Between CFA and CMT

CFA is the short form for Chartered Financial Analyst and aspirants after qualifying with this course can apply for job options like risk manager, research analyst, portfolio manager, consultant, relationship manager, chief executive, etc whereas the full form for CMT is Chartered Market Technician and aspirants with this degree can apply for jobs in risk management, behavioral finance, inter-market analysis, etc.

The financial industry has been growing at an unprecedented pace in the last few years, and this has spurned several new specializations as well in finance. This is one reason why finance professionals are looking to gain expertise in one of the specialized areas to survive and grow in this intensely competitive industry. There is no better way than earning a relevant credential to enter a specialized area in finance. Still, there are numerous such certifications afloat, and it would not be wise without reviewing them for credibility and the kind of learning opportunities offered before making a choice.
 
In the course of this article, we would be discussing CFA, one of the most widely recognized certifications in financial analysis and investment management, and CMT, a lesser-known but important certification in the field of technical analysis, which relatively few ventures into.
CFA-vs-CMT

You are free to use this image on your website, templates etc, Please provide us with an attribution linkHow to Provide Attribution?Article Link to be Hyperlinked
For eg:
Source: CFA vs CMT (wallstreetmojo.com)

CFA vs CMT Infographics


Reading time: 90 seconds

Let’s understand the difference between these two streams with the help of this CFA vs. CMT Infographics.

CFA-vs-CMT-info

You are free to use this image on your website, templates etc, Please provide us with an attribution linkHow to Provide Attribution?Article Link to be Hyperlinked
For eg:
Source: CFA vs CMT (wallstreetmojo.com)

CFA vs CMT Comprative Table

Section CFA   CMT
Organizing Body The exams are managed and controlled by the CFA Institute, USA.   The exams are managed and controlled by the Chartered Market Technician (CMT) Association, USA.
Pattern To become CFA qualified, the candidates need to pass three sequential levels

 

  •  Level I
  • Level II
  • Level III
  To become CMT qualified, the candidates need to pass three sequential levels

 

  • Level I
  • Level II
  • Level III
Duration of Course If the candidates are able to pass all levels on their first attempt, then they can complete the course in 48 months.   The candidates usually take 18 to 36 months to successfully clear all three levels.
Syllabus The syllabus primarily covers the following topics

 

  • Ethics & Professional Standards
  • Financial Reporting and Analysis
  • Quantitative Methods
  • Corporate Finance
  • Portfolio Management
  • Fixed Income
  • Alternative Investments
  • Equity Investments
  • Derivatives
  • Economics
  The syllabus primarily covers the following topics

 

  • Statistical & Trend Analysis
  • Chart & Pattern Analysis
  • Classical Methods
  • Portfolio Management
  • Selection & Decision Making
  • Chart Construction
  • Assets Relationship
  • Behavioural Finance
  • Risk Management
Exam Fees The total cost of the CFA qualification comes to be around $2,550-$3,450. The cost includes enrollment fee and exam fees that varies based on the time of registration.   For members, the cost of the CMT qualification comes to be around $1,535-$2,635, while that for non-members comes to be around $2,000-$3,100. The cost includes enrollment fee and exam fees that varies based on the time of registration.
Jobs Some of the common profiles include

 

  • Strategic Analyst
  • Investment Analyst
  • Financial Consultant
  • Wealth Manager
  • Portfolio Manager
  Some of the common profiles include

 

  • Trading Analyst
  • Hedge Fund Analyst
  • Portfolio Risk Manager
  • Investment Manager
Difficulty The exams are very difficult and only ~10% of the aspiring candidates who start the course become CFA charterholders. The pass rates of Level-I, Level-II and Level-III exams conducted in June 2019 were 41%, 44% and 56% respectively.   The level of difficulty of the exams is fairly reasonable as indicated by the historical pass rates of around 70%.
Exam Date The upcoming exams for the year 2021 are scheduled to take place as follows

 

  • Level I: February 16 – March 01, May 18-24, August 24-30, November 16-22
  • Level II: May 25 – June 01, August 31 – September 04
  • Level III: May 25 – June 01, November 23-25
  The upcoming exams of Level I and Level II for the year 2021 are scheduled to take place during June 03-13, while that for Level III is scheduled to take place on June 10, 2021.

What is CFA?


Chartered Financial Analysts (CFA) Institute offers the CFA Charter, acclaimed as the ‘gold standardGold StandardThe gold standard was a monetary term used when gold exchange was used instead of paper currency.read more‘ of financial analysis and investment management. It is an especially rigorous certification program that brings added value to the CFA Charter and helps finance professionals develop expertise in several key areas of finance, including financial analysis, equity research, and financial modeling along with other things. CFA offers validation of expert capabilities in finance and enhances career prospects for professionals. Please checkout the CFA Exam Details and Important Dates

What is CMT?


Chartered Market Technician (CMT) is offered by the CMT Association to help finance professionals develop technical analysis skills while acquiring a detailed understanding of the theoretical part and their practical application in varying contexts. Several other certifications provide exposure to technical analysis. Still, this certification offers a broad-based knowledge of the principles of technical analysis and the knowledge of professional, ethical framework for market technicians. It is a globally recognized certification that can help finance professionals look for the finest work opportunities in different parts of the world.

CFA vs. CMT Entry Requirements:


For CFA You Need:

To qualify for CFA, a candidate should have a Bachelor’s Degree (or they should be in the final year of Bachelor’s Degree) or 4 years of professional work experience or 4 years of higher education and professional work experience taken together.

For CMT You Need:  

One should hold a bachelor’s degree in finance, economics, business, or other related areas along with 3 years of work experience in an investment management profile.

Why Pursue CFA?


CFA is a highly competitive certification program that is meant to help professionals develop expertise in certain specialized areas of finance, including investment management, financial analysis, equity researchEquity ResearchEquity Research refers to the study of a business, i.e., analyzing a company's financials, performing Ratio Analysis, Financial forecasting in Excel (Financial Modeling), & exploring scenarios to make insightful BUY/HOLD/SELL stock investment recommendations. Moreover, the Equity Research Analysts discuss their findings & details in the Equity Research Reports. read more, and portfolio management. CFA Charter can lend greater credibility to the profile of a finance professional and open up an ocean of opportunities in the global arena. Even investment banks tend to rate CFA next to top MBAsCFA Next To Top MBAsCFA focusses on imparting skills associated with Investment Management including Investment Analysis, Portfolio Strategy, Asset Allocation, and Corporate Finance. MBA focusses on overall Management Skills like Marketing, Operations, Finance, Human Resource Accounting, etc.read more in terms of valued credentials when hiring fresh talent. In short, it stands out as one of the best credentials in business and finance across the globe.

Why Pursue CMT?


CMT offers international recognition, and finance professionals develop this certification for professionals, which sets it apart from most other technical analysis credentials. Technical analysis is widely considered to be nothing more than a methodology of representing financial data in charts and figures and interpreting the same. However, CMT deals with technical analysis on a whole different level. Professionals develop a deep-rooted understanding of mathematical fundamentals of technical analysis and learn about the relationship between prices and price patterns. This makes them fit not only for the professional role of a technical analyst but can also help them become good traders.

Conclusion


CFA is a comparatively much-advanced certification program that helps acquire an in-depth understanding of complex areas in finance, including but not limited to equity research, portfolio management, and core financial analysis. On the other hand, CMT has a much more specific focus on technical analysis, making it the best fit for those interested in entering a work profile closely linked with quantitative finance. Both of them require a good amount of work experience. Still, CFA is on a completely different level and is comparatively broad-based, which makes it more relevant for candidates looking to explore opportunities in varied areas of finance. CMT is rather limited in scope but offers a strong foothold within that context and helps validate the capabilities of professionals while opening up work opportunities related to quantitative finance in the global industry.

Reader Interactions

Comments

  1. Drake Weisinger says

    Thank you so much Sir for giving an awesome comparison between CFA and CMT. You always share the articles that are very useful and helpful. Keep posting.

  2. Johnny Donitz says

    Thanks for this brief comparison. Well I want to appear for CFA level 1 Exam. Is there any training tutorial so that I can expand my skills and get well prepared for CFA exam? Please share me some case study or any other tutorial from where I can learn and pass out the CFA exam easily. Waiting for your reply.

    • Dheeraj Vaidya says

      Thanks for your note. If you are preparing to appear for CFA Level 1 Exam then you must have a look at these awesome 70+ hours of (CFA Level 1 training tutorial) which provides you with an excellent opportunity to equip exceptionally well for the CFA exam and also pass the exam in your first attempt.

Leave a Reply

Your email address will not be published. Required fields are marked *