A Master of Business Administration (MBA) is applicable to most jobs in the financial industry. However, if your goal is a career as a financial analyst, a Chartered Financial Analyst (CFA) certification is more specific and may better suit your goals. Both programs provide you with advanced expertise and qualifications for top-level jobs in financial analysis.
Financial analysts manage portfolios and use their expertise to improve the investment performance for their client or organization. They are responsible for collecting, analyzing and monitoring data. Senior analysts create financial models, forecast trends, and develop strategies. Their knowledge and understanding of economic principles and investment concepts allows them to create targets, evaluate performance and propose changes.
Graduate Degree Comparison
Chartered Financial Analyst (CFA)
CFA programs are essentially a specialized qualification under the larger umbrella of finance, focusing specifically on portfolio management and investment analysis. They are relatively rare and may be more difficult to find in your preferred area, although they are usually available to complete online. The cost of a CFA is usually substantially less than that of a full MBA program. However, unlike most MBA programs, in order to become a CFA charterholder you will also need to complete a minimum amount of relevant work experience. The median salary for a Chartered Financial Analyst is $84,239, according to Payscale.com in 2018.
Master of Business Administration (MBA)
MBA programs cover a wide range of topics and courses, providing a broad base of financial knowledge, although students can choose specialties that allow them to narrow their focus. MBA programs are very common and available at just about any business school in the country. The cost of an MBA program covers several years of full tuition and will typically be much more expensive than the cost of a CFA program. According to Payscale.com in 2018, employees with an MBA working as a Senior Financial Analyst receive a median annual salary of $80,321, which is slightly below that of the CFA specialist.
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Chartered Financial Analyst
To pursue becoming a CFA, a bachelor's degree is required, and it takes four years to complete three levels of exams and the necessary work experience. The coursework is geared toward investment management, with specific courses including quantitative methods, ethics, corporate finance, economics, and financial reporting. Expertise in wealth management is provided by the study of equities, fixed income, derivatives, and alternative investments.
Master's of Business Administration
For admission into an MBA program, a bachelor's degree is generally necessary, with a minimum GPA requirement. You will need to provide transcripts, acceptable GRE (Graduate Record Examination) or GMAT (Graduate Management Admission Test) results, relevant work experience and letters of recommendation. Some MBA programs can be completed in as little as one year, but two to three years is more the norm. An MBA program will cover a very diverse set of financial topics, featuring courses such as corporate finance, behavioral finance, equity markets, and investment banking.
While both of these qualifications will adequately prepare you for a career as a financial analyst, the MBA program provides a broader base of financial knowledge. This means you will have more options when choosing your career, and will have the flexibility to change direction down the road. The MBA is the better choice if you want to develop your expertise in a variety of areas, or if you are not entirely sure if a career as a financial analyst is your ultimate goal. The CFA is the perfect choice for those certain that they want to focus on financial analysis, and those who prefer to acquire real work experience while completing their studies. Because the CFA course costs less and you are able to work throughout, this is also the more cost-effective choice.