CFA Certification in the Digital Age

It was only a matter of time before fintech (short for “financial technology”) became one of the topics covered on the CFA exam. Its inclusion is only natural considering that artificial intelligence, blockchain and cryptocurrencies – all part of the fintech universe – are slowly but surely making their way into the day-to-day operations of today’s organizations.

But what can CFA candidates expect with regard to this subject matter, which will be integrated into Level I and II CFA exams in 2019? Let’s start by putting your mind at ease: you will not be tested on your technological literacy per se. “Candidates will not be expected to code computer programs, but rather distinguish between structured and unstructured data analytic methods as well as identify characteristics of robust investment algorithms,” explained Stephen Horan, the CFA Institute’s managing director of credentialing. This should be reassuring to future CFAs who are not yet entirely familiar with the complexities of this brand-new sector.

 

Not a passing fad

In a recent interview with Bloomberg, Horan emphasized that the addition of these topics should not be seen as a passing fad. “We saw the field [of fintech] advancing more quickly than other fields and we also saw it as more durable,” he said. Many cryptocurrencies, despite having gone through their fair share of highs and lows in the past year, and blockchain are already on the radar of major financial institutions and governments. There is a good chance that these and other emerging technologies will be something tomorrow’s CFAs will have to deal with on a routine basis, if they are not already doing so. Hence the reason why crypto and blockchain concepts will addressed in the 2019 exam, along with other fintech-related subjects such as artificial intelligence, machine learning, big data and automated trading. The CFA Institute may also eventually add such topics as the intersection of virtual currencies and economics to this already extensive list.

 

Ethical issues

Technology may be advancing in leaps and bounds, shaking up the way things have been done in the business world for decades, but the corresponding regulatory framework and societal norms are, as usual, slow to follow. It is therefore easy for ill-informed or ill-intentioned people to cross over into the grey area that currently surrounds the use of fintech by major economic players, given the lack of legislation and standards. Accordingly, the CFA Institute plans to incorporate these new topics into professional ethics courses so that current and aspiring CFAs alike are well versed in these critical issues.

By working fintech into the content of its annual exam, the CFA Institute is putting tomorrow’s knowledge in the hands of today’s financial analysts.