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Candidates taking the financial world's toughest exam are getting younger.
More college students are signing up for the tests to get a leg up in competing for internships and jobs, according to the Chartered Financial Analyst Institute, which administers the tests.
The CFA is a three-exam qualification, often regarded as the industry's most rigorous and prestigious certification. It's a prerequisite for certain roles in banking or private equity. Only 46% of those who took the first level in May passed the test.
About one in five people who start the CFA process are students, Rob Langrick, chief product advocate at the CFA Institute, told Business Insider. Recently, the average age of candidates fell from 24 to about 23 as the number of undergraduates enrolling for the program increased, he said.
Langrick said that more people prefer to start the process while they are still used to studying and are not yet tied to a full-time work schedule. And for students coming from less-known schools, the CFA designation stands out for employers, Langrick said.
The increase in college students starting the CFA process comes as fewer people overall are taking the exams.
CFA Level I sign-ups first dropped in late 2020, given pandemic-induced cancellations and exam deferments. But the numbers have dropped significantly since then.
In 2018 and 2019, an average of about 162,000 people took the Level I exam each year. But in 2022 and 2023, that annual average dropped to about 87,000, according to the CFA Institute.
Eric Wye, who graduated last year from the National University of Singapore, prepared for the Level I and II exams as a student. He thought his economics degree didn't cover enough applied finance for the kinds of jobs he wanted to do.
But getting partway through the CFA didn't change his trajectory, Wye said.
"I felt that it did not explicitly give me an advantage in searching for finance internships, as I believe prior experience in related roles might be more valued," he said.
Wye is now working at a multinational bank while preparing for the Level III exam.
While the certification may be important for roles like portfolio managers and securities analysts, Wye does not think its value applies to all finance careers, including investment banking or sales and trading. On the job for a year now, he hasn't found many peers who passed all three CFA levels, nor that there is an implicit expectation of holding the designation.
Another candidate, who is in his third year of school at Singapore Management University and is preparing for Level I, agreed that the exam is more helpful for those outside finance looking to break in.
The student spoke to BI on the condition of anonymity, because he is a summer intern not authorized to speak with the media. His identity is known to BI.
"I think it's important if I didn't have access to finance at all. But if you're already in a finance major, then maybe it's not as necessary," he said.
Do you have a story to share about your career in finance? Email this reporter: shubhangigoel@insider.com