CFA Vs. MBA in Finance
The CFA and MBA are two advanced professional designations commonly used within business-related fields. Although both designations are highly regarded and typically suggest professional competence, there are significant differences between the two. Since each designation is difficult and time consuming to obtain, many professionals looking to obtain an advanced designation will consider either a CFA or MBA.
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CFA
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The CFA designation stands for Chartered Financial Analyst. Recipients of the designation are considered "CFA charterholders." Obtaining the designation depends upon passing a series of three six-hour examinations administered by the CFA Institute, holding a bachelor's degree and completing at least four years of qualifying professional experience within an investment decision-making process. The examinations are challenging, with a typical pass rate of less than 50 percent.
MBA
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The Master of Business Administration, or MBA, is a graduate-level degree awarded by colleges and universities. Although the degree originated in the United States, it is awarded by universities internationally. There are various external accrediting bodies, both at international and domestic levels, that certify the level and type of instruction necessary to complete the degree. In the United States, an MBA program is typically a two-year program when taken full-time. Internationally, many MBA programs are condensed into a one-year, highly intensive program. Part-time MBA programs are also popular.
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Focus
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Although many professionals consider the designations substitutes for each other, the CFA and MBA differ substantially in focus and depth. A CFA focuses on a range of finance and investment topics, while an MBA is a more broad-based approach to business management and operations. The CFA exam tests such skills as portfolio management, financial reporting and analysis and qualitative methods. An MBA exposes students to a wide range of topics, with students typically choosing to specialize in a specific discipline, such as finance, accounting, marketing, strategy or human resources.
Cost
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Enrollment and the cost of all three CFA examinations can cost participants nearly $1,500. Most CFA participants, however, study for and obtain the designation while employed. Many employers will pay for the cost of the exams, enrollment and study materials. Enrollment in a full-time two-year MBA program can cost upwards of $100,000, including room and board. Full-time MBA participants typically leave employment to complete the program. Part-time or executive MBA participants are typically employed and may have some or all of the program costs paid by their employers.
Ethics
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Ethics is an area of significant concentration on CFA examinations, and CFA designation holders are obliged to follow a strict code of conduct. The CFA Institute may revoke the CFA designation from those who fail to do so. Although ethics are a core part of nearly every MBA program, there is no general code of conduct. While an MBA degree may be generally revoked by the awarding university, this is done very infrequently.
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