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Alternative Investment Education - March 09, 2005

Alternative certification draws record numbers

A record number of candidates sat the examinations leading to the Chartered Alternative Investment AnalystSM certification last month. More than 1,700 individuals representing 400 institutions worldwide have received or are seeking the professional designation that is becoming the industry’s hallmark of excellence. Acquiring a sound knowledge of alternative investments or keeping up with the latest advances to better serve investors are key motivations for joining the programme. Obtaining an independent certification of skills to increase credibility and develop a competitive edge is another powerful incentive drawing individuals and firms towards the CAIA designation.

Massive inflows of institutional money into alternative investments are creating historic opportunities for the industry and imposing new responsibilities and challenges upon players. While an expanding industry calls for an expanding base of professionals serving investors, there is a risk to the community if knowledge and skills are allowed to lag behind. The alternative investment industry thus needs trusted professional standards as well as forums allowing practitioners to keep up with the pace of innovation.

Founded in 2002 under the auspices of AIMA and CISDM, the Chartered Alternative Investment Analyst AssociationSM advocates education and professionalism in the field of alternative investments and sponsors the CAIASM designation, the educational standard that has become the mark of distinction in the alternative investment industry.

Recognized globally, the CAIASM charter certifies an individual’s mastery of the concepts, tools and practices essential for managing traditional and modern alternative vehicles such as real estate, private equity, commodities, hedge funds and managed futures.

“CAIASM candidates come from 40 countries and include new industry participants seeking to establish a core understanding of alternative investments, generalists wishing to add another asset class to their investment arsenal, and seasoned professionals looking to explore new areas within alternative investment,” says Craig Asche, the association’s Executive Director.

“Over 25% of candidates are from Europe where Switzerland and the United Kingdom make up the bulk of the battalions and Germany, France, Italy and Luxemburg are also significant contributors of candidates,” says Frédéric Ducoulombier of EDHEC Alternative Investment Education. The executive education offshoot of the EDHEC Risk and Asset Management Research Centre, EDHEC AI Education is the CAIA Association’s exclusive official provider of preparatory courses for Europe.

“Past participants in our review courses and prospects demonstrate that the CAIASM programme appeals to a dazzling variety of professionals and institutions,” says Ducoulombier. “They consist of Fund Managers and Directors; Analysts, Consultants and Research Heads; Product, Marketing and Sales Managers; Lawyers; as well as Chief Executives,” he adds. Ducoulombier’s client list includes boutiques and giants alike: “Among the individuals we successfully helped prepare for the last exam session were professionals from Anglo Irish Bank S.A., Axa Multimanager, Credit Suisse, Merrill Lynch Investment Managers, Pioneer Alternative Investments Ltd. and Schulte Roth & Zabel International LLP.”

Acquiring a sound knowledge of alternative investments, keeping up with the latest advances, and obtaining an independent certification of skills to develop are some of the key reasons drawing individuals and firms towards the CAIA designation.

“After getting into the hedge fund business and learning pretty much on the fly, I wanted to take a 'bird’s eye' view of the industry,” explains Sascha Klamp of First Arrow Investment Management. “The AI business has grown significantly, and one needs to avoid the material risk of becoming the industry and going with the herds,” he adds.

Now a CAIA charter holder, Klamp emphasizes the knowledge he gained and the distinction the designation confers: “I enjoyed getting a broader view and being able to cross fertilize knowledge from the Private Equity, Commodities and even Real Estate market. The key benefit is setting a mark to the investment community that the alternative space is growing significantly and that there is a clear edge to distinguish oneself from the traditional equity and bond markets. CAIA shows investors and other professionals alike that there is more to alternative investing than just hedge funds. It sets the benchmark for all players who want to demonstrate not only skill but their dedication to the industry.”

Klamp, who studied finance at the University of Cologne and at the ISMA Centre, is convinced that the CAIA programme is the new standard for investment professionals who want to pursue a career in the alternative investment industry: “If you have a finance degree, there’s no need to go through traditional analyst certification programmes: they are just refreshers!. By contrast, the CAIA programme teaches you about subjects you have not touched upon at university.”

Guaranteeing a high level of competence to increasingly demanding investors and getting ahead of competitors are the main drivers of institutional support for the CAIA programme. “While the majority of candidates register of their own volition, institutional sponsorship of group registrations is picking up and a number of alternative specialists now make it a requirement for their professionals to pass the two exams that lead to the CAIA certification,” says Professor Ducoulombier whose structure recently ran a private review course for a Paris-based alternative asset manager and has recorded several group registrations for its preparatory seminars to be held in London, Geneva and Paris ahead of the CAIA’s July 2005 exam session.

The CAIA Association offers a 10% rebate to candidates registering for the July 2005 exam session before March 31st. For further information about the CAIA designation and the EDHEC AI Education review course, log on to: www.edhec-risk.com/AIeducation/CAIA or write to AIeducation@edhec.edu