According to Business Insider, the most recent results for the Chartered Financial Analyst® (CFA) Level 1 test were released in January, and 44% of the 47,175 test-takers passed the exam. Before you think that is a low figure, realize that the 44% pass rate is higher than usual. The CFA exam is one tough test!
The CFA mark has become the most respected and recognized investment designation in the world. The curriculum covers concepts and skills for investment analysis and real-world portfolio management skills. The exam consists of three parts, and the next level can only be taken once the prior one is passed. Fewer than 20% of candidates pass all three test on the first try, and on average it takes four years to complete the program.
Matt Wright, CFA charterholder at Modus Advisors, is in the 20%. Matt earned the CFA designation in 2008 after passing all three exams on the first try. He has been managing portfolios for clients for 8 years, and heads up the portfolio management team at Modus Advisors.
Achieving solid, long-term investment results is not easy. It requires education, discipline, and consistency. There are literally thousands of options to choose from. The ability to research and pick good investments is important, but it also is critical to know what to avoid. Successful investing requires knowledge of finance and control of your emotions. Investment plans can be ruined by letting our emotions get the best of us, just as they can be sabotaged through poor analysis.
When looking for a financial advisor/investment manager, ask to see their investment philosophy in writing. If it isn’t written down, it will probably change with the wind, to the next investment fad that comes along. Also ask for the manager’s credentials, including his experience and educational background. A well-constructed investment strategy combined with a high level of education and experience will increase the likelihood that you’ll be happy with your advisor, for the long-term. That satisfaction is what we strive to achieve for the clients of Modus Advisors.
Tad M. Weiss, MBA, CFP®