Are You Smarter than a CFA'er? Manager Qualifications and Portfolio Performance

24 Pages Posted: 21 Aug 2010

See all articles by Oguzhan C. Dincer

Oguzhan C. Dincer

Illinois State University - Department of Economics; Harvard University - Edmond J. Safra Center for Ethics

Russell B. Gregory-Allen

Massey University - Department of Commerce

Hany A. Shawky

State University of New York at Albany - School of Business and Center for Institutional Investment Management

Date Written: July 20, 2010

Abstract

Several studies have examined whether a portfolio manager having an MBA degree or being a CFA charter holder leads to superior portfolio performance, with generally mixed results. Possible reasons for the mixed findings are that most studies have considered the impact of a manager having either an MBA or a CFA separately, have not controlled for managers’ style targets, and have used different performance metrics. We examine separately and jointly the impact of portfolio managers having an MBA, a CFA and investment experience on portfolio performance, while controlling for market conditions and style targets, using five different portfolio performance measurements, and two different risk measurements. For individual models or methods, we find various weak evidence consistent with most previous literature. Once we take all the models and methods jointly into consideration, we find no significant difference in returns attributable to MBA, CFA or Experience, but more significantly, we find that on average, CFAs reduce and MBAs increase portfolio risk.

Keywords: CFA, MBA, Portfolio management, Manager qualifications

JEL Classification: G11, G23

Suggested Citation

Dincer, Oguzhan C. and Gregory-Allen, Russell B. and Shawky, Hany A., Are You Smarter than a CFA'er? Manager Qualifications and Portfolio Performance (July 20, 2010). 23rd Australasian Finance and Banking Conference 2010 Paper. Available at SSRN: https://ssrn.com/abstract=1661528 or http://dx.doi.org/10.2139/ssrn.1661528

Oguzhan C. Dincer

Illinois State University - Department of Economics ( email )

Normal, IL 61790-4200
United States

Harvard University - Edmond J. Safra Center for Ethics ( email )

124 Mount Auburn Street
Suite 520N
Cambridge, MA 02138
United States

Russell B. Gregory-Allen (Contact Author)

Massey University - Department of Commerce ( email )

Auckland
New Zealand

Hany A. Shawky

State University of New York at Albany - School of Business and Center for Institutional Investment Management ( email )

School of Business
1400 Washington Ave.
Albany, NY 12222
United States
518-442-4921 (Phone)
518-442-3944 (Fax)

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