The CFA exam’s toughest question: Is it worth it?

As financial workers from New Jersey to New Delhi sat this month for one of three grueling stages of the Chartered Financial Analyst exam, one question wasn’t on the test: Is it worth it?

The answer is elusive. Reliable estimates for how much the certification for valuing investments adds to a resume are virtually non-existent. While nobody’s saying it’s worthless, test-takers who typically pour more than 300 hours into studying for each level and spend thousands of dollars on fees and materials do it despite harrowing statistics. Four out of five who start the process drop out.

The odds of a big immediate payoff appear to be low. About 73% of job postings that specified compensation and included a reference to the CFA designation offered a salary below $100,000, according to research by recruiting company Phaidon International.

It’s the kind of information charter hopefuls are eager to find. Every year, hundreds flock to online forums to debate the payoff from adding CFA to their names, either in the form of compensation or a better job. Many responses argue the test’s rigor guarantees it adds cachet to a resume. Others cite anecdotal evidence.

One reason for the mystery is that the CFA Institute, which generates $260 million in annual revenue while running the tests, doesn’t track it.

The organization stopped asking applicants for data such as job titles and university degrees after the exam’s registration section reached 40 pages, taking candidates roughly 50 minutes to complete, said Steve Horan, managing director of credentialing for the Charlottesville, Virginia-based Institute.

“It’s definitely got a value proposition for both employers as well as employees,” he said. “It’s just that it’s difficult to quantify.”

Some job postings list the CFA designation as preferred or required, he said. And some outside studies have indicated that charter holders have improved earnings power.

One study conducted by a group of eight CFA Societies in the Midwest showed that, in Chicago, charter holders with a bachelor’s degree reported median income of about $154,000 — almost $70,000 more than college graduates without CFA alongside their names. For charter holders with graduate degrees, the median reported income was $215,500 — about $55,500 more than those lacking the CFA stamp.

The study is only meant to serve as a rough estimate. It doesn’t adjust its methodology for other variables, such as experience and duties. For example, CFA Institute members must log at least 48 months of work experience in investment decision-making to receive their membership. At many financial firms, employees routinely get significant raises after that initial period.

Another study conducted by InvestmentNews and the consulting firm Moss Adams found that lead financial advisers with the CFA charter earned about 24% more than those with the certified financial planner mark and 23% more than advisers who are certified public accountants.

The CFA Institute does track where charter holders and candidates are employed — a list dominated by the world’s biggest banks and topped by JPMorgan Chase & Co.

Six recruiters said in interviews that a CFA designation can lead to a raise or land a job, especially if the interviewer happens to hold one, too. But it’s rarely, if ever, necessary.

“Nobody ever says that they want to hire someone that’s a CFA — never,” said Robin Judson, president of Robin Judson Partners, which helps alternative-investment firms with recruiting. “Nobody says, ‘I don’t want to see them if they have a CFA.’ It’s not a negative. It’s just nobody is asking for it.”

EXAM TURNOUT

A record 172,682 candidates from 183 countries registered for this month’s exam, the Charlottesville, Virginia-based CFA Institute said last week. Asia accounted for 45% of registrants, with the Americas providing 33% and Europe, the Middle East and Africa 22%.

Global turnout for the CFA exam surged after the 2008 credit crisis, with young financiers looking to burnish resumes as banks slashed jobs. Almost 142,000 candidates were tested that year, a 30% increase from 2007. The charter’s popularity has helped sales at the Institute, where revenue climbed 34% from fiscal year 2010 to 2015.

“Career advancement/development” was the top motivation cited by candidates who took the June 2015 exams, drawing 37% of responses on the Institute’s survey. Another 11% said they hoped it would land them a job. Others said they wanted to hone skills, gain stature or “challenge myself.”

Standard registration fees for each level of the exam range from $825 to $860, which covers the curriculum, a study planner and practice tests. The real cost is the time spent studying, said Mr. Horan, the credentialing official. And that work ethic speaks to employers.

“I sort of think of it as the Statue of Liberty — ‘Give us your tired, your poor, your yearning to be free,’” Horan said. “And if I can make it there, I’ll make it anywhere.”

Recruiters were generally less enthusiastic.

“It does have a mild signaling effect to me this one’s a hard worker and is disciplined,” said Adam Zoia, chief executive officer of financial-services recruiter Glocap Search. “I don’t read it as meaning that they are going to be a better investor.”