MBA in Finance Vs CFA - Which is Better for a Finance Career?

Finances are a topic that every person on the planet can directly or indirectly relate to. Money connects the world and is probably the only thing that can be said to be common across countries, religions, races, ethnicities. However, there are not many people who have an understanding of how money works. It takes years of study and experience before you can do it.

Finance poses an exciting career choice for any student. It is a field full of innumerable challenges and it is not easy to make a career in the field. Still, many people choose to take it up. It is because Finance is a field that promises exciting opportunities for earnings, growth, meeting new people and understanding one important factor that connects us all -- money and the markets.

If you have decided to get into a career as an Investment Banker, Financial Analyst or any other similar career, there are high chances you are considering pursuing a Master of Business Administration (MBA) or a Chartered Financial Analyst (CFA) course. However, to make the right choice, it is important that you understand what are the differences between these courses. Which course would be more suited to your needs and would be more rewarding for your investment. Let's take a look at the comparison of MBA in Finance vs CFA.

MBA in Finance vs CFA: The Basics

Before moving on and getting into more detail about this course, let's cover some of the basics about these courses.

It can be seen that while both courses are related to the same field, they are still quite different in many aspects. A more detailed comparison of the two courses will help shed more light on which course should be the best for you.

MBA in Finance vs CFA: About

MBA in Finance is a 2-year postgraduate programme. The course teaches a student how to manage financial services while also equipping them with the basic and advanced knowledge of financial areas. The course includes subjects such as financial planning and management, advanced marketing etc.

CFA is an internationally-recognized degree course that does not have a defined duration. The course can be completed in 2 years but the average time taken by a candidate to complete this course can range from 2 - 4 years. The course focuses solely on the concepts of finance and financial analytics. Students who complete this course gain immense technical knowledge about the field.

MBA in Finance vs CFA: Level of Difficulty

Both MBA in Finance and CFA are quite challenging for students. Both courses require students to work on building their financial knowledge. However, a different picture is presented when one starts to explore more details.

At first glance, it may seem like MBA in Finance is the more difficult course as it requires students to work on their financial and managerial aptitude. However, generally speaking, it can be said to be the easier course of the two. Most of the students who take up this course are able to pass with relative ease.

CFA, on the other hand, is known for being one of the most difficult courses in the field of finance. If we take a look at the June 2019 CFA exams, the pass rates are as follows.

These figures are largely consistent for the previous year CFA exams as well. Plus, the overall completion rate of the CFA program is around 13%. These figures indicate that not only are many students unable to clear the exams but a large number choose to drop out of the course as well.

Although this should not deter you from taking up a course, it should be taken into account for proper planning and keeping a backup plan.

MBA in Finance vs CFA: Admission Process

The admission process for an MBA in Finance course is quite elaborate, especially if you want to join the top colleges. You have to appear for an MBA entrance exam and also go through the selection process of the particular college you wish to join. Plus, colleges also consider your previous academic performance and work experience for selection.

The MBA entrance exams are usually conducted from December - February and the admission process concludes in the months of March and April. Take a look at the MBA Admission Process in India for detailed information.

The CFA admission process is pretty simple. Candidates who satisfy the eligibility criteria have to just simply register on the website of ICFAI or CFA Institute. CFA exams are conducted in the months of June and the Level I exam is also conducted in December.

Registrations for the June exam close in March and students are allowed to register for the December exam till September. This article on CFA Application Process and Exam dates provides more information.

MBA in Finance vs CFA: Syllabus

Let's take a look at how the syllabus for both courses compares.

MBA in Finance vs CFA: Cost and ROI

The cost of an MBA in Finance degree varies depending upon the college from which you want to pursue the course. While the course fee is quite low in government colleges, the course fee in select private colleges can go up to Rs.15 lakh, which is a very large investment. Students interested in pursuing MBA in Finance have to take the cost of their degree into account to ensure that they get a good ROI.

The average cost of a CFA degree is around Rs. 2 lakh. CFA is much cheaper than an MBA in Finance degree and it promises the same if not more returns. Plus, since the course is mostly based on self-study and does not require a candidate to join any particular college, there are no additional costs associated with the programme except for the course fee. However, taking into account the level of difficulty of the exam, many candidates do join coaching institutes for better preparation, which can incur extra costs.

MBA in Finance vs CFA: Career Scope and Salary

Due to an MBA in Finance degree being related to the management stream, it offers a wider scope in the domestic market. The course is highly valuable in the private sector and there are a number of MBA jobs in the government sector as well. It is also a preferred course of Investment Bankers who want to get promoted to higher positions in their fields.

CFA is an internationally recognized course which has a scope in India as well as abroad. Students who are looking for international career opportunities should prefer this course. However, Chartered Financial Analysts are required to have at least 4 years of work experience in a full-time position.

Both of the courses are specialized to cater to students who wish to make a career in the financial sector and offer good scope and career opportunities.

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