The Certificate in Investment Performance Measurement (CIPM) is an internationally recognized accreditation. The general purpose of the CIPM is to educate professionals on how to accurately calculate and communicate investment performance figures. The CIPM is an important designation within the financial services industry because it helps provide confidence that the investment performance figures used throughout the industry can be relied upon by all involved. Advertisements often feature returns on specific products or strategies and/or individual securities, therefore it is very important for the investing public to be able to trust that these figures are being calculated and presented on an “apples-to-apples” basis.

The CIPM designation is granted by the CFA Institute, which is the same organization that offers the Chartered Financial Analyst (CFA) designation.

• CFA is the short form used for Chartered Financial Analyst. CIPM is the short form used for Certificate in Investment Performance Measurement.

• In general, the CIPM is revolves around after-the-fact measurement tools and analysis, where as the CFA is more centered around future-based analysis (stock picking).

• A CFA Chartholder can apply for the job titles of research analyst, consultant, portfolio manager, chief executive, risk manager, relationship manager, financial adviser, and corporate financial analyst. A CIPM designation allows for job opportunities in an investment bank, GIPS verification companies, investment management, research companies, performance measurement, software development companies, or even be used for job titles of plan sponsors, performance measurement, etc.

• The CIPM revolves around topics such as:

  • Ethics and Professionalism, including vast knowledge of all of the GIPS Standards

  • Performance Measurement, Attribution, Presentation and Appraisal

  • Manager Selection

• The CFA revolves around:

  • Alternative Investments

  • Corporate Finance

  • Portfolio Management and Wealth Planning

  • Financial Reporting and Analysis

• The CFA costs an average of $2500-$3500 depending on the time of registration, and the cost includes the exam and enrollment fees. Whereas the CIPM costs range from $100-$1500, depending on the time of registration, and is entirely due to exam-based fees.

• As of August 2023, the pass rates for Level I, Level II, and Level III of the CFA exam were 37%, 44%, and 47% respectively. As of September 2023, the pass rates for Level I and Level II of the CIPM exam were 42% and 50% respectively.

CIPM is an intensely focused course with rigorous study material that concentrates on broad topics like performance measurement, attribution, and appraisal. It is a specialized area with the domain of portfolio management at the core, allowing you to gain skills that show your mastery in finance by acquiring some invaluable skills in the certificate program.

The certificate has been offered since 2006. As of 2023, according to the CFA, there are 2,600+ CIPM certificate holders. Obtaining the designation is seen as a badge of expertise and accomplishment that can advance a career.

Earning a CIPM isn’t essential for an investing career. But it will help establish expertise and credibility in investment performance, fund manager assessment and presentation skills. You can earn a CIPM in a year through moderate expense and effort. The limited upfront investment of time and money may give it an appealing cost-benefit ratio compared to other investment industry certificate programs.

• Membership in the CFA Institute.

• Membership requires a four-year bachelor’s degree or equivalent experience.

• 24 months of professional experience in roles specifically related to calculating and reporting investment performance figures. Alternatively, candidates can also meet this requirement by demonstrating four years of experience in a broader set of roles within the financial industry.

According to the CFA Website:

• 18 Months - The average time it takes to complete the CIPM program is 18 months of self-study

• 155 Hours - The average amount of self-study time, per exam level

• 2 Exam Levels - Candidates who qualify for membership in the CFA Institute have to take two exams to earn the CIPM designation. But, CFA charterholders and those who have successfully passed the Level III CFA® exam can enter and complete the program directly at Level II.

  • Exam Level 1: Portfolio Performance Measurement and Attribution - Emphasizes the conceptual foundations of portfolio performance measurement, attribution, appraisal, and presentation, as well as the GIPS standards. This level is weighted more heavily on performance measurement and attribution. Contains 100 multiple-choice questions and last 3 hours

  • Exam Level II: Performance Appraisal and Manager Selection - Emphasizes performance appraisal and manager selection, including application of the appropriate tools and inputs in more complex investment decision-making situations. Contains 20 scenarios, each followed by four multiple-choice questions. Applicants get three hours to complete this test.

• Dates & Cost - There are two dates for each exam, in March and September, therefore, the exams are only offered twice per year. The exam costs around $675 to register for the exams, with a July 31 deadline each year. That covers the cost of the exam and the CIPM study materials. Early registration (before May 31) reduces the cost to around $475. CFA dues of $275 annually are also a requirement.