Claritas Investment Certificate: What It Is, How It Works

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What Is the Claritas Investment Certificate Program?

The CFA Institute offers a third program, apart from the Chartered Financial Analyst (CFA) designation—the gold standard for professionals involved in investment decision-making—and the Certificate in Investment Performance Measurement (CIPM).

The Claritas Investment Certificate was launched on May 20, 2013, at the 66th CFA Institute Annual Conference in Singapore. The program was developed by the CFA Institute over two years as part of a global call to action for industry participants to play a role in addressing the overall lack of trust in financial services, following the worldwide financial crisis of 2008.

Key Takeaways

• The Claritas Investment Certificate is a program that focuses on investment industry basics and the roles and responsibilities of financial services professionals.
• The program is an online, self-study course, with seven course modules covering various topics, such as industry controls and ethics and regulations.
• Although the Claritas Investment Certificate and the CFA designation address the same industry, the CFA curriculum is much more in-depth and geared towards individuals who are directly involved in investment decision-making.
• Participants in the program gain access to study materials, which consist of an eBook, a study planner, chapter review and practice questions, and a mock exam fashioned after the administered exam.

Understanding the Claritas Investment Certificate Program

The Claritas Investment Certificate is a foundation-level program designed to provide a clear understanding of investment industry basics and the roles and responsibilities of financial services professionals.

Since there are no restrictions on entry into the Claritas program, it may be a cost-effective alternative for someone looking to switch fields and get into the financial services industry. It is well-suited for professionals working with investment decision-makers in support or back-office/front-office functions (e.g., operations, administration, IT, human resources, marketing, sales, compliance, customer service). It also appears appropriate for students who wish to get into entry-level financial services positions.

Claritas Investment Certificate Requirements

The program is an online, self-study course comprised of 21 chapters organized into seven modules (approximate exam weightings are shown in parentheses):

• Module 1—Industry Overview (5%)
• Module 2—Ethics and Regulation (10%)
• Module 3—Tools and Inputs (20%)
• Module 4—Investment Instruments (20%)
• Module 5—Industry Structure (20%)
• Module 6—Industry Controls (20%)
• Module 7—Serving Client’s Needs (5%)

Participants can expect about 80 to 100 hours of study over a three to six month period.

Study materials consist of an eBook, a study planner, chapter review and practice questions, and a mock exam, which has the same length and topic weightings as the actual Claritas exam.

The eBook contains the complete Claritas Course of Study and forms the foundation of all exam questions. It can be accessed online and can be downloaded to as many as four devices (two computers and two mobile devices).

The eBook is also available in print through Amazon.com (two volumes at a cost of $45 each). Candidates also gain access to a personalized planner that can help them assess the time commitment required per chapter, based on the number of days remaining until the scheduled exam date.

Fees

Individual registration costs $685 and includes access to all study materials, the exam registration fee, and one exam sitting. The cost can be lowered by as much as $200 if you work for a large firm that supports the program and register through your employer. Employers and institutions can buy Claritas bulk registration vouchers at a discounted price: 25 to 99 vouchers $635 each; 100 to 249 vouchers $585 each; and 250 or more vouchers $485 each.

Examination

After registering for the Claritas examination, a candidate must schedule an exam appointment and take the exam within 180 days. The Claritas examination is computer-based and consists of 120 multiple-choice questions to be completed in 120 minutes.

The exam is administered at many Pearson VUE test centers around the world. Exam candidates are asked to allow up to 2½ hours at the test center, which includes time to check-in, go through the exam tutorial, review and agree to the Claritas Candidate Pledge, and complete the exam.

Claritas Investment Certificate vs. CFA

The Claritas Investment Certificate differs substantially from the CFA in several ways, including:

• Program scope: The CFA program is widely considered to be the investment profession’s most rigorous credentialing program and the “gold standard” for investment management. The Claritas certificate is a foundation-level program that aims to impart an understanding of investment industry fundamentals. While the CFA curriculum is much more in-depth, the Claritas program can be a good way to “test the waters” for those considering enrollment in the CFA program.
• Different target markets: The Claritas certification is aimed at everyone in the investment industry who helps enable investment decision-making. The CFA program is targeted at those individuals who are directly involved in investment decision-making.
• Entry requirements: While the Claritas certificate is aimed at support staff in the financial services sector, there are no entry restrictions, and anyone can register for it. In contrast, the entry requirements for the CFA program are quite stringent—the candidate should either have a Bachelor’s degree (or be in the final year of a Bachelor’s degree program), four years of professional work experience, or a combined four years of college and professional work experience. Candidates must also sign a Professional Conduct Statement disclosing if they have been the subject of a written complaint or have been involved in any litigation or investigation for the previous two years.
• Certificate/charter requirements: Candidates who successfully pass the Claritas exam receive the Claritas Investment Certificate. To become a CFA charterholder, the candidate must pass all three levels of the CFA program, each of which culminates in a six-hour exam. Also, the candidate must possess four years of qualified investment work experience of which at least 50% must be directly involved in making investment decisions.
• Passing levels: 82% of the 2,408 candidates who took part in the Claritas pilot program successfully passed the exam. It's estimated that one in five people who begin the CFA program will successfully complete it and becomes a CFA charterholder.
• Commitment levels: The Claritas program is cheaper and requires less time commitment than the CFA. CFA candidates pay a one-time enrollment fee of $440, as well as an exam registration fee that can range between $620 and $1,170, depending on whether the registration is done before the first deadline in September or the final one in March. Each level of the CFA program takes about six months of preparation. While most candidates take between two and five years to complete the program, successful candidates take an average of four years.