Newsletter - July 2011

CAIA Comments

Preview of the New CAIA Level I Curriculum

Don Chambers, Ph.D.
Associate Director of Curriculum, CAIA

The CAIA Association is in the midst of a major overhaul of its curriculum as we continue to move from a CAIA curriculum that is built around existing literature to a curriculum with material that is specifically written for the CAIA Association. This change is in response to the needs of our members and candidates.

By designing our own materials we are able to move the focus of the program in the following directions:

  • The new Level 1 curriculum expands asset coverage. The new Level I curriculum keeps up with the changing world of alternative investments by expanding the coverage of real assets. Material is also being reorganized by including a new hedge fund classification system and by bringing the coverage of managed futures into the coverage of hedge funds.

  • The new curriculum is less U.S.-centric. The new Level I curriculum focuses more on content that transcends national borders. Obviously, this leads the curriculum away from issues such as "Which regulation requires registration of securities offered to the public?" while leading us toward other changes such as devoting less material to publicly traded real estate (REITs) since REITs are primarily a U.S. phenomenon and most global real estate is privately traded.

  • The new curriculum requires less memorization of facts. The argument is that in this age of internet access there are many facts that can be easily retrieved so it is unnecessary to memorize them. But then again, day-to-day discussions and analyses in the workplace require a foundational knowledge that can be quickly recalled from memory. As an example, an airline pilot needs to know what each gauge means – it is not enough for the pilot to know that there is a manual in which the information can be found when he or she needs it.

    • We have developed a standard on which to judge the need to know a fact. We ask ourselves the question: "Is this a piece of information that a successful professional working in alternative investments and attending a meeting would benefit from knowing or is it a fact that can be retrieved from reference materials when needed?"

    As we approve new content or write new multiple choice questions we try to avoid the trivial and focus on the essential. For example, we are less concerned about "which of the following assets had the highest correlation with inflation rates in the last 20 years" and more concerned about "what the reasons are that we should expect commodity prices to be correlated with inflation".

  • The new curriculum is more about "How" and "Why". If we can better understand how the world of alternative investments works and why it works that way, then we are better prepared for the future. For example: How is merger arbitrage executed and why would the strategy be expected to generate alpha?

There are underlying economic forces that are timeless. People are motivated by incentives, but sometimes there are unintended consequences. A trade occurs when both parties perceive gain, but often trade is a zero-sum game. The new curriculum is designed to provide a foundation of understanding that can provide support to CAIA's members for decades of service to the industry. We never lose focus on our primary goal in curriculum: equipping members with the knowledge and skills to enhance the execution of their professional duties and maximize the long-term value of their service.

Our scheduled release date for the Level 1 revision is on or before April 2012 with the first exam based on the revised curriculum scheduled for September 2012.

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CAIA News

100 Women in Hedge Funds/CAIA Scholars Announced

The CAIA Foundation awarded 10 scholarships to the inaugural class of 100 Women in Hedge Funds/CAIA Scholars.

The scholarship program, administered by the CAIA Foundation, was established in collaboration with the 100 Women in Hedge Funds Institute and is underwritten by Pacific Alternative Asset Management Company, LLC (PAAMCO) to support women seeking to earn the CAIA designation, the highest standard of education in alternative investments. The scholarships cover enrollment and registration fees for CAIA Level I and Level II exams, the CAIA Knowledge Series textbooks, the Schweser CAIA Level I PremiumPlus Study Solution, and the first year CAIA Association membership fee. Read the press release.

London's Cass Business School Selected as Newest CAIA Academic Partner

The CAIA Association has entered an academic partnership with Cass Business School, which is part of City University London and among the top one percent of business schools worldwide. The partnership is focused on preparing graduate students for careers encompassing alternative investments, the fastest growing segment of the asset management industry.

Through the partnership, Cass MSc in Investment Management students will have access to courses that cover 60 percent of the material required to earn the CAIA designation. In addition, students and faculty will have the opportunity to apply for CAIA scholarships. Read the press release.

Students, faculty, and guests attended a special program to announce the CAIA Academic Partnership agreement with the Cass Business School in London

Connecticut Hedge Fund Association Endorses CAIA Designation

The CAIA designation is the official designation of the Connecticut Hedge Fund Association (CTHFA), which represents some of the largest hedge funds in the world.

"Recognition of the CAIA brand continues to grow worldwide and this alliance will facilitate our mutual interest in promoting education and high standards of conduct in the industry," said Florence Lombard, CEO of the CAIA Association.

Job Opening: CAIA Director of Business Development – Americas

The CAIA Association is hiring a Director of Business Development - Americas, to promote the CAIA designation throughout the USA, Canada, and South America. This position will build on CAIA's excellent reputation and success by executing CAIA's comprehensive business development strategy in the Americas and by promoting the Association's program to financial firms, industry associations, stakeholders, and regulatory bodies.

The ideal candidate possesses at least five years' experience in the finance industry (preferably in the alternative investment sector in business development or sales) and strong relationship management and communication and presentation skills. The position will likely be based in New York and will require extensive travel throughout the Americas.

Video: Jerry Harris, CAIA, Discusses the Value of the CAIA Designation

Jerry Harris, CAIA, Private Investor, says the CAIA designation has value for professionals of all seniority levels and job functions. Watch him explain why the CAIA program is a valuable tool for all professionals in alternative investments.

AIMA: "No Hedge Fund Today Should be Deemed 'Systemically Important'"

As the Financial Stability Oversight Council considers and is expected to clarify soon the criteria by which it will determine which non-bank financial companies may be deemed systemically important, and thus subject to increased regulatory scrutiny, including additional oversight by the Federal Reserve, AIMA reiterated its strong belief that no hedge fund manager based or operating in the US or elsewhere currently poses a risk to financial stability. Read more.

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Exam News

September 2011 Exam Registration Closes Aug. 1

  • Exam registration closes Aug. 1, 2011 at 11:59 PM EDT
  • Late registrations are not accepted.
  • Exam Dates:
    • Level I Exam Session: Sept. 19 - 30, 2011
    • Level II Exam Session: Sept. 12 - 23, 2011
  • Register for an exam here

Scheduling an examination appointment:
Pearson VUE testing centers are currently open to scheduling for the September 2011 CAIA exam period. The CAIA Association recommends scheduling an exam appointment through Pearson VUE as soon as possible to ensure a seat at each candidate's preferred testing center. All exams are scheduled directly through Pearson VUE.

Registration vs. Scheduling:
While exam registration closes on Aug. 1, candidates may schedule an exam appointment with Pearson VUE at any time after completing the purchase process. The CAIA Association recommends that candidates book their exam appointment with Pearson VUE at the earliest opportunity. Deferments are not allowed and will not be granted to candidates who are unable to sit for the exam due to failure to schedule an appointment.

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CAIA Out Front

CAIA CEO Florence Lombard Is a Panelist at Thought Leadership Symposium

Florence Lombard, CEO of the CAIA Association, participated in a panel discussion on "Operational Practices & Risk Governance: Emerging Issues and Concerns". The discussion was part of the Regulatory Compliance Association's (RCA) Asset Management Thought Leadership Symposium held at the Ritz Carlton in San Francisco.

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CAIA Chapter Notes

Educational and Networking Events

For a complete listing of CAIA chapter events, visit the events page on caia.org.

CAIA Los Angeles Managed Futures Panel
July 21, 5:00 PM - 8:00 PM
Beverly Wilshire, Los Angeles, California
CAIA Los Angeles presents a unique opportunity to contrast fund managers' views across different strategies and focuses.

Panelists include:

  • Tony Fenner, Head of Americas Development, Winton Capital
  • Brent Hankins, CAIA, Senior Portfolio Manager, Welton Investment Corporation
  • Paul Kim, Founder and CEO, Misfit Financial Group

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