CFA Certification Program and Sell-Side Analysts

The CFA program substantially improves the recommendation performance of analysts that participate in the program. The positive program impact is much stronger for analysts who cover smaller companies or companies with thinner overall analyst coverage. Analysts improve their performance when going through the CFA program as candidates but stop such improvements after completing the program. The learning from the CFA program also significantly reduces risk-taking and bias behavior in analyst recommendations. Moreover, CFA designations increase analysts’ mobility to larger brokerage firms. The results survive various robustness checks, including using different methods to deal with the selection bias.

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