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The CMT Association is a globally renowned non-profit professional organization which is composed of nothing but the best and the most competent technical analysts. This organization is responsible for certifying individuals who are deemed experienced and proficient enough to utilize and read technical analysis data. Its main goal is to establish and maintain the best standards, and the highest of that, when it comes to professional prowess and professional ethics among these groups of technical analysts.
The Chartered Market Technician exam must be taken in order for aspiring technical analysts to gain the necessary credential certified and duly acknowledged by the CMT Association to perform such functions.
Basically, a Chartered Market Technician or a CMT is a technician who professionally holds the CMT Certification. They are competent in assessing and reading technical data which is considered one of the most important tools in navigating that disparity between an asset or security’s market intrinsic value and the price using a systematic approach to thoroughly study the behavior of the movement of these securities in the market.
Having earned this certification, you will be able to know important aspects about portfolio management and the dynamics involves in market trading.
Taking the CM Program would comprise 3 important exams. The first 2 exams are in the nature of a multiple choice type of exam while the last exam is the most challenging of them all because it is an essay type of exam which will take you up to 4 hours to finish.
The exam is offered twice only on a yearly basis. And because of this, applicants may be able to do the necessary studying and preparation within a span of 18 months. This is just a standard estimate though. Because in some cases, there are applicants who would actually spend a total of 3 years so that they would be able to prepare for the said exam. But then again, they could be full time workers so it actually depends on each person.
However, as reference, the CMT Association recommends that one must allow at least a total of 100 hours of pure studying for each of the level entailed in the program.
Once you have already set a date as to when you are to take the CMT exam, it is important to maintain a plan of action that must be consistently followed all the way. Experts suggest that these helpful tips must be followed:
The trick is to not stress so much. To be able to study effectively, one must have a clear and a serene state of mind free from stress and hassles of other things that you are worrying aside from the exam.
This is the part where one must strictly avoid possible distractions that might steal you away of your time intended for studying. In the same way, it is also important when it comes to doing important things other than studying, one must also respect such time and do what you need to. So that when the time comes that you go back to your study hours again, you feel refreshed and ready take the tedious task of studying again.
You can take practice tests or mock exam so that you know how far you have mastered the topic and at the same time focus on certain areas in the topic that needs improvement.
There are 3 levels of the CMT exam. These are the following:
The CMT Level I exam is more on basic, entry-level competence and understanding of technical analysis. In this exam, one must be able to have a working knowledge of the basic tools of a technical analyst. Once the first level is successfully completed there is no time limit to pass the subsequent levels. The objective in passing this exam is to test the entry-level competence and understanding of the candidate including his sufficient working knowledge of the basic tools needed of the technical analyst.
These are the topics covered by CMT Level I exam:
|
Topics Covered |
Rate |
No. of Items |
|
Theory and History |
10% |
12 |
|
Markets |
3% |
3 |
|
Market Indicators |
13% |
16 |
|
Construction |
15% |
18 |
|
Trend Analysis |
15% |
18 |
|
Chart and Pattern Analysis |
18% |
22 |
|
Confirmation |
10% |
12 |
|
Cycles |
4% |
5 |
|
Selection and Decision |
5% |
6 |
|
System Testing Money Management |
5% |
4 |
|
Ethics |
3% |
4 |
|
Total |
100% |
120 |
The CMT Level II exam is where the candidates show a demonstration of a greater depth of analysis and use of technical tools. Here, the candidate is expected to show proficiency especially in the application of advanced techniques require analytical skills and theory. The Level II candidate is expected to demonstrate proficiency in applying more advanced analytical techniques and technical analysis theory.
These are the topics covered by CMT Level II exam:
|
Topics Covered |
Rate |
No. of Items |
|
Theory and History |
3% |
4 |
|
Market Indicators |
5% |
7 |
|
Construction |
1% |
1 |
|
Trend Analysis |
20% |
30 |
|
Chart and Pattern Analysis |
23% |
35 |
|
Confirmation |
15% |
23 |
|
Cycles |
3% |
4 |
|
Selection and Decision |
17% |
26 |
|
System Testing Money Management |
10% |
15 |
|
Ethics |
3% |
5 |
|
Total |
100% |
150 |
Finally, the CMT Level III exam gauges the development of logical and consistent research opinions, portfolio strategies and trading decisions based on a wide range of charts and technical data. The Level III exam is more on analyzing different case studies where a candidate makes recommendations and justifies those recommendations based on the data provided.
If you are interested in working in any financial position, taking and passing this test will help you gain the right expertise for the said job. Basically, if you want to be an analyst, this is the right job for you.
However, for those who want to be traders and would like to learn more about the intricacies of trading, one may also be able to gain experience in taking the CMT course. In fact, even those registered representatives may also be able to learn a thing or two in CMT course.
The first thing to do is to register in the program which requires you to be a member of the CMT Association by paying the corresponding membership fees. After having been enrolled in the exam, the candidates must be able to pay the registration fee. This will be for the exam.
In order to take the exam, it is required to pass all the 3 levels in the examination and further comply to the CMT Association’s Code of Conduct.
Remember that this exam is a 3-part series. Level 1 exam tests entry-level competency; Level 2 exam tests the ability to demonstrate such competency in a wide array of expertise; and finally Level 3 exam tests the ability to form reliable opinions, strategies and decisions based on a given technical data.
The first 2 levels of the exam compose of multiple choice questions which should take you 2 hours. The total number of questions is 132 multiple choice question. On the other hand, the last level of exam is essay type. These exams are all computerized.
The good thing about the CMT program is that it is available not only for members of the CMT Association but also to non-members as well. There are just some changes in the fees depending on your status and on the Level of exam to be taken.
CMT Program enrollment is fixed at $250. However, the registration fees for the different kinds of exam as a member or a non-member now varies as follows:
|
Member Pricing |
Level I |
Level II |
Level III |
|
Early Registration |
$275 |
$475 |
$475 |
|
Standard Registration |
$375 |
$575 |
$575 |
|
Late Registration |
$575 |
$875 |
$875 |
|
Nonmember Pricing |
Level I |
Level II |
Level III |
|
Early Registration |
$450 |
$650 |
$650 |
|
Standard Registration |
$550 |
$750 |
$750 |
|
Late Registration |
$750 |
$1,050 |
$1,050 |
Comprehensively, if you want to avail the package course as a member, it will cost you $2,025. On the other hand, for non-members, total program cost for CMT is at $2,250.
By default, the passing score for Level I and Level II exams is fixed at 70%. However, in some cases, the score may vary up to 3%. Such results will be released within 3-4 weeks. However, for the CMT Level III exam, the results may take longer since it is an essay type. Usually, it will be declared within 6-8 weeks.
Ranking alongside chartered financial analyst and certified public accountant, the Chartered Market Technician is also considered as a very vital professional certification. The prices of the various securities in the market and other economic indicators require accurate and reliable technical analysis for one to make smart business or investment decisions – something that only chartered market technicians are capable of doing.
Matthew is the Senior Exam Consultant in PassCMT
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