My Academic Background Bachelor’s degree - Completed B.Tech in Biotechnology ( 2002 to 2006 - 4 years course). Obtained a software certification (2006 to 2008) Joined a software company as a software developer (2008) Left that software company (2010) DID NOTHING SINCE THEN !!!** What I want to see myself in the future** I want to get my licence as a Portfolio manager and start my own Portfolio Management Firm. Q1) Is CFA going to be the best choice for the purpose ? Q2) I’m 35 now. Will my age create a problem ? Q3) Is the gap (10 years almost) going to create problems ? If the answers is “NO” to all the 3 above queries: Q4) Where can I get : (a)Study Materials (b)Previous years/model/sample Questions and answers ©Suggestions for future tests ? Q5) After I am prepared for the test,what are the procedures and prices to sit for the exams?
Sir, everything can be found in Google.
But honestly, if you ever worked in finance and have a solid background, understand what PM is and how to manage it, you can do it .
Otherwise, you are software person, so maybe you do not have a clear understanding of finances and just want to embark on it because somebody told you that PM is the lake of revenue.
I think if you want to launch a financial firm, favourably fintech product or service, you’d better continue developing computer skills and find the partner with solid finance background. So the technical parts are gonna be addressed to you and financial part to him
Many fintech developers are from mathematics and computer science, for instance Robinhood.
Go to the CFAI website. Start trading and build a track record. You’ll need a job in finance to fulfill the experience requirement for the charter. Check the CFAI website for the specific requirements. You don’t need a CFA charter to start an RIA. You will need to sit for the series 65 investment adviser law exam, which may be significantly easier. The 65 is still a tough exam even for people in finance. I’ve seen many “smart” guys fail it.
lol dafuq? how do you fail series 65. i think i got like a 96 or something.
This is one of those posts where it’s so hard not to be rude. I’m tempted to lock this for stupidity but I don’t think that’s actually against the rules.
1- No and Yes. CFA does help some people get their foot through the door in some firms.
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Yes. 35 is too old to transition from software guy to PM
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Yes. 10yrs isn’t a gap… it’s a grand canyon
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forget it
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google it.
In other words, you’re too old, no experience and you’re pigeon holed as an IT guy. You got nil chance of becoming a PM… and CFA will not help you get there.
Of course, if you don’t like this answer… just keep asking and asking and asking and listen to the 1% of people that tell you otherwise, then waste 3yrs of your life studying for CFA and proving 99% of other people correct
Ok, for the time being, let us talk of getting a job as an Equity rsearch analyst (which IMO is an excellent doorway for entering the PMS industry)
Just becaue he used to be (1)a software guy (2)comes with a gap of 10 years and (3) age is 35…
Despite of all the above drawbacks , Even if one completes all 3 levels , will he still get rejected as an Equity research analyst?
The only way you ever manage money is by starting your own RIA. Here’s all you have to do:
- Choose your business entity and domicile.
- Register the business with the secretary of state.
- Obtain the federal tax ID number for the business.
- Complete FINRA’s Series 65 exam. Some states waive this if you have earned your CFP, CFA, CIC, ChFC or PFS.
- Register your RIA with the Investment Adviser Registration Depository (IARD) and receive a CRD number.
- Register your firm with the SEC or state(s). In general, RIA firms with assets over $100 million register with the SEC. Others register with their state of domicile.
- Create your Form ADV (Parts I and II) on the IARD website and your client agreements.
- Draft your compliance manual and policy notices.
- Install your initial regulatory compliance program.
- Set up books and recordkeeping.
Then you can call yourself a PM (though 97% of RIAs really shouldn’t go around calling themselves portfolio managers, but that’s another topic). You could start by managing your own money but you’d probably want to raise capital along the way to make it more interesting.
Other than the above scenario, the Raiders have a better chance of winning the Super Bowl than you do of ever working as a PM or research analyst. Sorry, but it isn’t happening. Ever.
Exactly.
Need to fill that “gap” in here. Unless you were doing something spectacular this thread is already done.
What you were doing all 10 years? Is it even possible not to work and study during 10 years?Meditating in the mountains of Tibet with Dalai Lama?
If you want to be a financial advisor for individual clients, a CFP is probably more appropriate than a CFA, and it’s a lot easier to obtain.
Why do you want to be a portfolio manager?
What makes you think that you’d like being a portfolio manager?
What makes you think that you’d be any good as a portfolio manager?
You are asking the wrong people. You need to ask hiring managers. Go to the CFAI website and find your local Society. Call the society president and ask for some advice. They’ll at least guide you to the people who know the answers to your questions. My answer is that it’s never too late. But it depends on the company you’re applying too. Some companies only hire recent college graduates. Some only hire experienced analysts with finance backgrounds. Some only hire engineers and if you’re not an engineer everything else is irrelevant.
About “Registered Investment Adviser” firms: RIA firms come in different flavors. Some are wealth management and financial planning firms like mine. Some are portfolio management firms that build pooled investment vehicles like mutual funds. Some RIA’s are hedge funds. I outsource my investment management to large asset management firms that are RIA’s like BlackRock, and American Funds. I even use Morningstar Managed Portfolio’s which is an RIA owned by Morningstar. Most state registered RIA’s like mine can’t truly claim to be portfolio managers because we don’t take discretion or custody. I was told by our state examiner that only 5 of the state registered firms in my state take custody. You need custody and discretion to make actual trades with other peoples money (Great movie). We’re all more like portfolio advisors. We make recommendations and then relay our clients instructions to the portfolio managers who execute. Most clients don’t know enough to give instructions on what they want in a portfolio. So, we design their portfolio, build proposals, get approval, and then relay the instructions (I make my clients sign them) to the portfolio managers. Some managers work with large accounts and actively manage individual securities in the portfolio. Some managers work with small accounts and build funds of funds, or in a manage account a portfolio of funds.
There are thousands of equity analysts jobs in thousands of investment related firms: RIAs, BDs, Insurance Carriers, IBs, PEs, HFs etc… Then you have Wall Street firms and Main Street Firms. It’s like Broadway and Off Off Off Off Broadway like mine. Add a few more offs to that. 
You’re probably going to need a CFA to do actual portfolio management or be an equity analyst. Also, most people will never start their own RIA and aren’t really capable of running one. It not about difficulty, it’s about lifestyle as an entrepreneur.
This subject is not the life or death situation that was promised in the request to participate in this topic.
+1 to pokhim, Sweep, and everyone else in that camp.
What? None of this is correct. Calling American Funds an RIA is so, so wrong. They’re an asset manager or fund company. It’s true that they have to file a Form ADV but Morningstar, BlackRock, American Funds, etc. would not be considered an RIA by 99% of the investment community. Also, RIAs generally have full discretion of client assets. It’s one of their defining features. And, none should custody their own assets (some hedge funds do, but that’s how you get a Madoff situation). I’m not even sure how that would work for a normal RIA. Another defining characteristic of an RIA is that they clear through a custodian. Generally Schwab, Fidelity, TD, or Pershing, though broker-dealers like LPL also offer clearing services.
What you’re describing is something more along the lines of using an SMA that BlackRock or whoever manages. I have no idea how you operate as an investment advisor and don’t know these things.
My RIA does not have discretion and I do not have a custodian. I solicit accounts for my partner RIA, my vendor. I am 100% independent with no broker dealer. They have several custodians that they work with.
Also, I went to a state sponsored compliance convention where I sat with owners from hundreds of state registered RIAs that also do not have discretion or custody. So they must be the 1% of investment professionals that don’t know any better. Someone better call our state administrator, they’ve got it all screwed up… lol! In fact, there was an entire hour, during that convention, where an examiner spoke to us about why its advisable to avoid discretion and custody. That is when I learned that state registered RIAs with discretion and custody are rare. Understanding what is what isn’t custody isn’t as straightforward as you might think. You can still inadvertantly have custody even if your client’s assets are held with a custodian. SEC registered RIAs may be a different story. I’m not SEC registered. You become SEC registered based on either AUM which requires custody or because of the number of states you notice file in.
Anyway there’s no point in arguing here. Just call a state administrator and ask. Ask them what custody and discretion mean too.
Oh, you can also check the SEC Investment Adviser Public Disclosure Site to see that American Funds is considered a registered investment adviser by most investment professionals. Especially by the ones that count, The regulators
Yeah…I’ve been working with RIAs my entire career and have what you’re saying is just plain inaccurate, or maybe I should say your situation is far outside the norm. Either way, for those interested in learning more about how RIAs function, your statements above are misleading.
If you just google “top RIAs” and look at those firms, they’re not BlackRock or American Funds. They’re firms like Financial Engines, HighTower, EP Wealth, and Savant on the wealth side, and firms like RBG, Retirement Advisors of America, and Sheridan Road on the retirement side.
If they focus on retirement then they may not have discretion since 401ks are self-directed, but those larger ones above are starting to white label their own target date funds so they’re moving to discretion even in 401ks. The only other example of an RIA that chooses not to have discretion is when they have clients, generally very small clients, they provide advice for but don’t actually do the trades. Those are the really, really small players though, and again, not what most people would consider a “normal” RIA.
Here’s an example of an RIA in my area that’s one of the biggest in the country: Creative Planning. Check out their Form ADV Part 5. Scroll down about half way and you can see they manage $37B and of that $36B is discretionary. Yes, they’re one of the biggest in the country, but look up any RIA and you’ll see nearly all of them have full discretion of their clients’ assets (non-retirement).
The issue of custody is a little different as the SEC does say if you (an RIA) deduct your fees directly from a client’s account, you are considered a custodian. Makes sense from a legal standpoint, but in practical terms when RIAs are talking to their clients, people like me that work for an asset manager, or other RIAs, they’re talking about Schwab/Fidelity and so on.
tl;dr - Someone wanting to start an RIA would likely follow the fee-only model, build their business to have full discretion, and pick one or more of the major clearing/custodian firms to place their trades and custody assets. That’s what nearly all RIAs look like.
I mentioned that above. Yes, every asset manager is a Registered Investment Advisor. But, we don’t go around calling ourselves RIAs. Again, just google top RIAs and see who pops up. Asset managers aren’t on the list because it’s common sense to exclude us when talking about RIAs. That term is nearly always meant for Investment Advisors.
Interesting distinction. I suppose it’s matter of perspective. My state requires a certain level of due diligence on asset managers before I recommend them. I see them all as RIA’s. They are investment advisers according the investment advisers act of 1940, and they register as such. That’s the legal and compliance term for them. What they prefer to be called for marketing purposes is different. Most financial planners, wealth managers, financial advisors, etc. don’t go by the title RIA either. Though they are required to mention their status in marketing materials. I advertise as a financial planner. Financial planners are required to register as investment advisers in my state. So my firm is an investment adviser that is registered. I don’t think my description is deceptive. I’ve filed the paperwork and registered two RIAs in my career. I’ve spent a lot of time on compliance. I know how to register and open an RIA in my sleep. Again, its about perspective. I’ve seen the RIA world from a different perspective. Even when I was with a big insurance carrier, their RIA was different. It was owned by a B/D so all IARs were also Registered Reps. and compliance was a nightmare. I’m glad that’s over. The investment community is pretty big so I can’t speak for them with any authority. I just know the regulators be “Patrolling and tryin’ to catch me ridin’ dirty”, and it’s “hard out here for a pimp”. If you set it up right you cold be “big pimpin”.
Oh, and for the op and the public, I’m not an attorney so if you take compliance and legal advise from me… Good luck with that…Seriously don’t do that.