May 23, 2017 / 7:10 PM / 3 years ago

CFA exam to add artificial intelligence, 'big data' questions

NEW YORK (Reuters) - Students of investing will need to start cramming for a new subject: computer science.

As of 2019, the Chartered Financial Analyst (CFA) examination will add questions on artificial intelligence, automated investment services and mining unconventional sources of data, an official from the accrediting group that manages the finance credential said this week.

The CFA accreditation is seen as the industry gold standard for everyone from wealth advisors to Wall Street analysts.

The rewriting of the exam on wealth and asset management to embrace computer and data science illustrates the degree to which the once-stodgy business of selling securities is becoming a playpen for nerds and robots.

Stephen Horan, managing director of credentialing for the CFA Institute, said the new topics will be added alongside previous ones like algorithmic and high-frequency trading.

“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,” Horan said in an emailed statement.

“FinTech will soon play a more prominent role in the education of upcoming financial professionals.”

Fund managers who pick stocks and bonds are under increasing pressure as index funds and one-click investment services called “robo-advisers” offer lower-fee options for managing money.

Improved techniques, along with greater computer power and storage, have made it easier to forage through mounds of “unstructured” data like satellite images for clues on economic trends not captured by analog measures like gross domestic product or earnings per share.

“A background in computer science or generally programming is incredibly helpful for the finance industry,” said Stephen Benvenuto Jr., a junior at the Stern School of Business at New York University, who is majoring in finance and considering pursuing a CFA credential.

“It’s definitely moving in that direction.”

The traditional curriculum covers a sweeping range of topics, from understanding how corporations spend cash to the mechanics of complex financial instruments and government regulation.

Horan said more people with traditional technology backgrounds are taking the grueling set of three exams that leads to the credential.

Some 190,000 people will sit for the CFA exam on June 3, a record number. Nearly six in 10 people who took the day-long Level 1 exam last year failed.

Reporting by Trevor Hunnicutt; Editing by Jennifer Ablan and Richard Chang

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