Difference Between CFA and CWM

CFA is the abbreviation used for Chartered Financial Analyst. The CFA Institute offers this course to enhance aspirants’ in-depth knowledge of problematic areas of finance. In contrast, CWM is the short form for Chartered Wealth Manager provided by the AAFM (American Academy of Financial Management). It enables aspirants to learn the basics of wealth and asset management.

Which is better? Certification courses are abundant and a great deal of worry for many students who want to pursue them. On one side, we have the CFA examsCFA ExamsThe Chartered Financial Analyst (CFA®) Program offers a graduate-level curriculum and examination program designed to expand your working knowledge and practical skills related to investment decision-making. read more, which are considered the gold standardThe Gold StandardThe gold standard was a monetary term used when gold exchange was used instead of paper currency.read more among the finance certification exams. So if you have a keen interest in Portfolio ManagementPortfolio ManagementPortfolio management involves overseeing a set of investments, including securities, bonds, exchange-traded funds, mutual funds, cryptocurrencies, etc., on a personal or professional levelread more, Investment Management, 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 Investment BankingInvestment BankingInvestment banking is a specialized banking stream that facilitates the business entities, government and other organizations in generating capital through debts and equity, reorganization, mergers and acquisition, etc.read more, CFA is the right fit. On the other hand, Chartered Wealth ManagerChartered Wealth ManagerCWM stands for Chartered Wealth Manager, and the American Academy of Financial Management (AAFM) established this certification in 1996. There are two levels of examination: level 1 is the Foundation level, which is a two-hour exam for 100 marks, and level 2 is the Advanced level, which is a three-hour exam for 160 marks.read more (CWM) is the best certification for wealth management, private banking, family officesFamily OfficesA family office is a management entity that holistically manages the investment and other finance-related needs of ultra-high-net-worth families. It is difficult to define the qualifying level to be branded as a UHNW family.read more, and financial advisory professionals. This article details the differences between the two and helps you clear the confusion.

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CFA vs. CWM Infographics

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Let us understand the difference between these two streams with the help of infographics: –

CFA vs. CWM Comparative Table

What is CFA?

This certification program is conducted by the U.S.-based CFA Institute (formerly the Association for Investment Management and Research, or AIMR). It is an ideal path-breaking experience for finance and investment professionals seeking a career boost. The course provides a solid foundation in advanced investment analysis and real-world portfolio management, which industry insiders appreciate globally. The study format is designed to meet the demands of the growing investment industry, looking for sharp skills to accelerate market growth and the companies. Considering this aspect as a major factor in initiating this course, the CFA Institute pays utmost regard to ensure the syllabus is updated regularly and continuously meets the market demand. The course covers topics like investment management, financial analysis Financial AnalysisFinancial analysis is an analysis of finance-related projects/activities, company’s financial statements (balance sheet, income statement, and notes to accounts) or financial ratios to evaluate the company’s results, performance, and trends, which is useful for making significant decisions such as investment, project planning and financing activities.read more, stocks, bonds, and derivativesDerivativesDerivatives in finance are financial instruments that derive their value from the value of the underlying asset. The underlying asset can be bonds, stocks, currency, commodities, etc. The four types of derivatives are - Option contracts, Future derivatives contracts, Swaps, Forward derivative contracts. read more and provides a generalist knowledge of other areas of finance. The candidate is awarded a CFA charterholder on successful exam clearance and equipped to advise companies and institutions like banks, mutual fundsMutual FundsA mutual fund is a professionally managed investment product in which a pool of money from a group of investors is invested across assets such as equities, bonds, etcread more, insurance companies, and other financial institutionsFinancial InstitutionsFinancial institutions refer to those organizations which provide business services and products related to financial or monetary transactions to their clients. Some of these are banks, NBFCs, investment companies, brokerage firms, insurance companies and trust corporations. read more.

  • Economics

  • Ethics & Professional Standards

  • Corporate Finance

  • Portfolio Management

  • Fixed Income

  • Alternative Investments

  • Equity Investments

  • Derivatives

  • Financial Reporting and Analysis

  • Quantitative Methods

  • Global Financial System

  • Behavioural Finance in Wealth Management

  • Wealth Management in Banking

  • Intergenerational Wealth Transfer

  • Investment Vehicles of Wealth Management

  • Managing Investment Risk

  • Equity Analysis

  • Alternative Products in Wealth Management

  • Real Estate Valuation and Analysis

  • Portfolio Management Strategies

  • One-time registration fees of $450 Exam fees for each level vary between $700 to $1,000 depending on the time of registration

  • Registration fee of $400 that is valid for one year

  • The exam fee for Level 1 is $200

  • The exam fee for Level 2 is $600

  • The re-examination fee is $200  Certification fee is $100

  • Strategic Analyst

  • Investment Analyst

  • Financial Consultant

  • Wealth Manager

  • Portfolio Manager

  • Wealth Manager

  • Financial Controller

  • Asset Manager

  • Market Analyst

  • Level I: 41%

  • Level II: 44%

  • Level III: 56% [Source: CFA Institute]

 

  • Level I: Feb 15-21, May 17-23, Aug 23-29 & Nov Level II: Feb 22-26, Aug 30- Sep 03, Nov Level III: May 24-26 & Aug 30- Sep 06

What is CWM?

The Chartered Wealth Manager is the best certification program for professionals in wealth management, private banking, family offices, and financial advisory. The American Academy of Financial Management conducts this international certification program based in the United States that marks excellence and is recognized worldwide in the finance industry, including the global wealth management industry and the private banking community.

The Chartered Wealth Manager (CWM) is the highest designation a professional can achieve in wealth management and private banking. The CWM’s core thrust is capital and financial marketsFinancial MarketsThe term “financial market” refers to the marketplace where activities such as the creation and trading of various financial assets such as bonds, stocks, commodities, currencies, and derivatives take place. It provides a platform for sellers and buyers to interact and trade at a price determined by market forces.read more theory, financial services organization principles, portfolio management, investment management, and other skills related to the field. A CWM designation is a benchmark for professionals to fulfill certain financial management responsibilities, allowing an employer to allocate the responsibility of assessing the value of companies, performing financial estate analysis, understanding portfolio management, time horizon, balancing risk and returns, identifying market opportunities, market products, handle asset allocationAsset AllocationAsset Allocation is the process of investing your money in various asset classes such as debt, equity, mutual funds, and real estate, depending on your return expectations and risk tolerance. This makes it easier to achieve your long-term financial goals.read more, and manage clients.

CFA vs. CWM Exam Requirements

A student is eligible to appear for the CFA exam if they have a bachelor’s (or equivalent) degree or are in the final year of a bachelor’s degree program (an update is required on attaining the degree to qualify for the Level II) or must have a minimum of four years of professional experience. In addition, a candidate successfully clearing the exam must fulfill a mandatory four years of experience to achieve the certificate of the CFA program.

For the CWM exam, a candidate must have a graduate degree or education equivalent to a post-graduate, approved by the AAFM, and a minimum of three years of wealth management experience.

Why Pursue CFA?

  • The CFA program bridges the gap between market demand and a professional. The program ensures the candidate’s aptitude is developed according to the industry’s current practice.The difficulty level of the CFA exam assures students to put in quality efforts and study rigorously to be noticeable in the employer’s eyes.The CFA hones a candidate’s practical skills, thereby making them an asset for a company with a competitive edge, increasing chances of a hike in the future.The CFA program is cheaper than the other certifications, providing sound knowledge about the financial markets and increasing a candidate’s expertise.

Why Pursue CWM?

  • The CWM designation commands the respect of the consumers and professionals of the industry.The CWM adds value to your resume-boosting your career prospects immensely.CWM opens the way to multiple opportunities, and among them is the confidence to start your own business.The CWM is the best qualification a professional can achieve in the wealth management industry. Therefore, this designation in a candidate’s profile enhances accessibility to industry events and networking opportunities.

Conclusion

CFA exams are an ideal and path-breaking experience for finance and investment professionals. It provides a solid foundation in advanced investment analysisInvestment AnalysisInvestment analysis is the method adopted by analysts to evaluate the investment opportunities, profitability, and associated risks in their portfolios. In addition, it helps them to determine whether the investment is worth it or not.read more and real-world portfolio management, which industry insiders appreciate globally. However, CWM is the best qualification a professional can achieve in the wealth management industry. Though CWM is difficult, candidates can take at least four attempts to clear it, so they should spend quality time studying.

Choose the one that excites you the most!

This article is a guide to better career alternatives between CFA vs. CWM. We discuss job options, fees, pass percentage, and focus areas to help you decide. You may learn more from the following articles: –

  • CFA vs. CQFCFP vs. CWM – Which is Better?CFA vs. CFQ DifferencesCFA Exams