The CFA Institute awards certifications to investment professionals and operates educational programs. It administers the CFA and CIPM designations and publishes the Financial Analysts Journal. The institute values professionalism and high ethical standards and established Global Investment Performance Standards (GIPS) to ensure credibility among investment firms.
The CFA Institute is a non-profit association for investment professionals that awards Financial Analyst (CFA) and Certified Investment Performance Measurement (CIPM) certifications. The institute administers and rates the CFA and CIPM designations and publishes the Financial Analysts Journal. It also operates the CFA Institute Center for Financial Market Integrity and the Research Foundation of CFA Institute.
The primary mission of the CFA Institute is to assess individuals and provide them with CFA designations. CFAs, or licensed financial analysts, are individuals who have received professional designations to practice as financial analysts; it is considered the gold standard of the field of investment analysis. Before taking the exam, individuals must possess a bachelor’s degree from an accredited institution or have an equivalent education plus 48 months of professional work experience. Individuals must complete a series of three, six-hour long exams through the association. Once the person passes these tests, they will receive the CFA certification and are required to comply with the CFA Institute’s Code of Ethics.
The CFA Institute also offers a variety of educational programs and services to both association members and non-members. It is headquartered in the United States in Charlottesville, Virginia, and also has offices in Hong Kong and London. The institute is the largest association of investment professionals, with more than 100,000 members worldwide.
The CFA Institute began when the Financial Analysts Federation (FAF) created the independent Institute of Chartered Financial Analysts to handle the tests. Although the ICFA was originally an independent organization created by the FAF, the two organizations eventually merged to become the Association for Investment Management and Research (AIMR). AIMR later changed its name to the CFA Institute.
The association values professionalism and high ethical standards. The organization’s formal mission statement, according to its website, is to lead “the investment profession globally by setting the highest standards of ethics, education, and professional excellence.” In association with its mission statement, the CFA Institute established in 1999 what are known as Global Investment Performance Standards (GIPS).
GIPS is a set of standards for reporting investment performance. According to the institute, these standards also aim to create global and industry-wide ethical methods for communicating investment results to prospective clients. GIPS are often credited with ensuring credibility among investment firms and making comparable investment summaries among different firms available to potential clients. GIPS are seen as the core of the CFA Institute and its mission for ethical equality and, as of 2010, have been sponsored and promoted in 32 countries.
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