Difference Between CIPM and CAIA
Certificate in Investment Performance Measurement is the full form for CIPM and with this degree, an aspirant can secure job roles in investment banks, plan sponsors, GIPS verification forms, etc whereas CAIA stands for Chartered Alternative Investment Analyst Association and with this degree, an aspirant can secure career as an analyst at private equity funds or hedge funds.
Choosing between two careers – CIPM and CAIA is simple as well as a difficult job. It depends on whether you are clear on what you want to do in Finance.
- On one hand, CIPM exam is just right for a candidate who would like to pursue and succeed in the field of investment performances as an analyst.
- On the other hand, CAIA exam is for candidates looking for a career in Alternative Investments (like Hedge Funds, Private Equity, Real Estate, etc).
We have brought to you details of the CIPM and CAIA certifications to help you decide between them, it is our little effort to simplify decision making.
What is the CIPM?
This course is just the right course for a candidate who would like to pursue and succeed in the field of investment performance as an analyst. CIPM course includes performance measurement and attributes of investment it can be investment banking, investment analysis, investment management, investment advisory, etc.
Certificate of Investment Performance Management (CIPM) is offered to be appeared by the Association of CIPM which is obviously a part or is associated with the CFA Institute. And hence CIPM is an international professional course. Let us give you a background for this course.
- Not knowing the continuous change in the investment industry there had been certain regulations, laws and market trends that decided the measurement and the advertising trends of financial products. However, the previous advertisement trends are now not used and encouraged for advertising these products anymore especially by the US Securities and Exchange Commission.
- Now the global investment management industry has set a certain set of standards that cover calculations of returns and advertising standards in order to adhere to it, it has achieved continuous growth worldwide. These standards are called the Global Investment Performance Standards that are GIPS.
- Now that GIPS is an international body, it has made clear that this industry will hire only proper professionals. This entire scenario led to CFA form the CIPM association.
- This certificate gives you proficiency in the fields of investment performance of the investment firms globally.
What is CAIA?
This course is designed in order to train a candidate in alternative investments. What are alternative investments as per your knowledge? Ok, let us explain. It is nothing but asset class except for standard equity and fixed income products, in fact, alternate investments deal in hedge funds, private equity, real assets, and commodities, etc, etc, etc…
- This course is offered by the CAIA Association. This association was found by the Alternative Investment Management Association along with the Center of International Securities and Derivative Markets in the year 2002.
- CAIA is a nonprofit association and an independent global organization that is focused in educating and creating professionalism in the fields of alternative investment.
- The members of CAIA need to maintain their membership with the CAIA Association by adhering to the ethical and professional standards of alternative investments.
- This international course has two levels to clear before the candidate becomes a certified Chartered Alternative Investment Analysts.
- It is also said to be one of the most competitive exams in the world of business, or commerce, or finance. This course is recognized as the best in its class. It provides immense knowledge, credibility, and helps demonstrate expertise in this domain of finance.
- This is the best way to make you smart and stay updated about alternative investments.
CIPM vs CAIA Infographics
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Let’s understand the difference between CIPM vs CAIA certifications.
CIPM vs CAIA Summary
|Certification Organized By||Certificate in Investment Performance Measurement is organized by the CIPM association which is a part of and is associated with the CFA Institute.||Chattered Alternative Investment Analyst is organized by the CAIA Association. This association was found by the Alternative Investment Management Association along with Center of International Securities and Derivative Markets.|
|Number of Levels||CIPM has two levels that is, the CIPM Principle Exam and the CIPM Expert Exam. The details of both the examinations differ from each other.||CAIA has two levels of examinations where level I covers the basic understanding of the concepts of alternative investments; however level II is again divided into 2 parts covering alternative investments and core and integrated topics.|
|Mode/duration of examination||CIPM Principle Exam|
This exam is strictly in English. This computer based examination is a 3 hour examination which is180 minutes. In this examination you only have multiple choice questions.
CIPM Expert Exam
This part is a pen and paper examination having more complex scenarios where appropriate tools and inputs need to be used. This examination has 80 set of questions which include 20 senarion questions that are followed by 4 multiple choice questions. Even this examination is timed for 3 hours which is 180 minutes.
CAIA level one is a multiple choice question examination. This examination consist of 200 questions. This examination is a 4 hour examination which has a break in between as well. The mode of this examination is online.
CAIA level two consists of 100 multiple choice questions along with 3 sets of constructive response essay questions. This examination again has a duration of 4 to 4 ½ hrs with a break.
|Exam Window||CIPM Exam Dates 2017:|
March 2017: 16 Mar – 31 Mar
September 2017: 16 Sep – 30 Sep
|September 2017 Exam Window
Level I: September 4-15 2017
Level II: September 18-29 2017
February and March 2018 Exam Window
Level I: February 26 - Mar 9, 2018
Level II: March 12 - Mar 23, 2018
|Subjects||CIPM Principle Exam and the Expert Level covers the following|
3.Performance Appraisal and Manager Selection
5.Performance Presentation and GIPS Standards
|Level I Topic Outline
Professional Standard & Ethics
Introduction to Alternative Investments
Risk Management and Portfolio Management
Level II Topic Outline
Professional Standard & Ethics
Current and Integrated Topics
Asset Allocation and Portfolio Management
Hedge Funds and Managed Futures
|Pass percentage||September 2016 exam results:|
Principles exam results:- pass rate: 42%
Expert exam results:- pass rate: 52%
|CAIA 2015 Exam results:-
Level I and Level II
March:- 66% and 68%(level II)
September:- 66% and 67%
CAIA 2016 Exam results:
Level I and Level II
March:- 59% and 70%(level II)
September:- 61% and 66%
CAIA 2017 Exam results:
Level I and Level II
March:- 63% and TBA(level II)
|Fees||Early registration fee: US$575‡ (The early registration period closed on 31 May.)|
First-time candidate registration fee: US$975‡
Returning candidate registration fee: US$500‡
|Program Enrollment: US$400
Level I Exam Registration: US$1250
Level II Exam Registration: US$1250
Annual Membership Dues: US$350
Early Registration fee for Level I and Level II: US$1150
|Job opportunities /job titles||Can make you a market expert as an analyst, risk manager, fund manager, professional advisor, investment banker, and much more||You can definitely be an expert in alternate investment analysis, risk management, financial advisor, investment banker, etc.|
Professional certifications have certain requirements to appear and clear them. CIPM examination requirements are given below.
- Two or more years of experience in calculations, analyses, showing investment results, evaluation different investments, giving services such as consultation, legal and regulatory, technical and accounting directly supporting investments, GIPS standard compliance verification experience, monitoring people practicing investment activities directly or indirectly, or even teaching investments.
- Or you need a four-year experience in the investment industry that mainly consist of activities such as application or evaluation of financial, economic and statistical data as one of the most important parts of investment, marketing services of investment management, keeping a close watch on investment firms that comply with the standards, regulations, and laws of the industry, recommending investment managers after evaluating them.
There are no mandatory requirements to take up this alternative investment examination. However, if you want to make sure you are heading in the right direction you must have the following:-
- Understanding of the basics of finance and qualitative analysis.
- If you are really interested in developing expertise in alternative investments as a risk manager, analyst, portfolio managers, traders, consultants, advisors, etc.
- A genuine interest in learning the subject.
Why Pursue CIPM?
Obviously you will pick up a course if it is advantageous. If you are a professional in the related fields and you want to get on to a higher designation or if you are a student and you want to make sure that you start big, this course can help you achieve success in every stage of your career. This course will add value to your work and your life in the following ways.
- In a designation like a risk manager or an analyst, you have to deliver results of high returns by minimizing risk. And this course will help you develop an insight that will help you deliver more actionable results.
- To add to your recruitment quality the content of this course will help you analyze the right candidate for risk management, improve your contacts which will help you search and select the right manager.
- Studying, evaluating and producing reports will be one of your most important tasks. These reports need to be transparent as per the laws of the regulators. CIPM gives you the ability to help you produce comprehensive and transparent reports.
- Risk is a definite factor in this job. However, the risk needs to be calculative, measured and obviously minimum. You will be able to create awareness of the increased risk in this profile.
- If you have the ability your feedbacks and viewpoints will be very important to people who know your knowledge level which includes your firm, your clients, etc. you will now be able to provide feedback to maximize money for people and firms.
Why Pursue CAIA?
To start with, the members of CAIA look at and consider different standards for alternative investments industry and professions. They do enjoy a number of benefits that are associated with this designation
. You can consider working for a number of domains on different designations within alternative investments. The choice you have is multiple it includes Hedge Funds, Private Equity Funds, Investment Banking, and obviously Commodity Desk.
- With the membership as a CAIA, you get access to a number of related events and conferences globally to share investment and improvement ideas.
- These conferences give you the opportunity of growing in terms of knowledge of alternative investments. At these conferences, you get to socialize with similar background professionals which gives you contacts to maintain.
- The association makes sure you get on to the higher and very professional designation of your interest along with perks associated with the membership.
- Most importantly this program is valued and trusted by top employers across the globe. As it helps the candidates achieve very high standards in alternative investments.
- This helps you build a global community along with giving you international recognition. You get an opportunity of pursuing and updating your knowledge of alternative investments all your life.
- A course with the help of just two levels can help you change the face of your career; however, this course is definitely not going to be rocket science for you if the alternative investment is the passion for you.
For certain courses, you need passion, passion for knowing the market, the industry, and the off-course must have the passion to make money sweat. If you are really interested in investment performance measurements and the data that relates to it we would suggest CIPM as a career option for you.
An alternative investment is a different ball game altogether. It is much different for the rest of the market. If you love private equities, hedge funds, commodity desks, and not the real stick market then this is the place to be my friend.
However, do not forget that it includes a lot of studies as suggested recommended study time is more than 200hrs. If you are prepared to give in so much time and effort then you must take CAIA as your career.
This has been a guide to CIPM vs CAIA. Here we discuss top differences between CIPM and CAIA based on job options, fees, pass percentage, focus areas. You may also have a look at the following articles –