Chartered Market Technician
Chartered Market Technician (CMT) is a professional designation that confirms proficiency in technical analysis of the financial markets. To hold the designation, membership in the Market Technicians Association is required.
The CMT designation requires completion of an education program and examination series in technical analysis. The Market Technicians Association (MTA) oversees the program curriculum and administration of exams. Candidates who pass all three examination levels of the program can earn the Chartered Market Technician designation, which certifies that the individual is competent in technical analysis.
The CMT program
The Chartered Market Technician (CMT) Program is a certification process in which candidates are required to demonstrate proficiency in a broad range of technical analysis subjects. Administered by the Accreditation Committee of the Market Technicians Association (MTA), Inc., the Program consists of three levels. CMT Level 1 and CMT Level 2 are multiple choice exams while CMT Level 3 is in essay form.
The MTA began to develop the CMT program in 1985. Just as other professional organizations have standards of competence for members, so the CMT designation provides a recognized standard of proficiency for technical analysts. (The CMT examinations are administered by Thomson Prometric, which administers other professional tests, such as the CPA exam.)
The objectives of the CMT Program are:
- To guide candidates in mastering a professional body of knowledge and in developing analytical skills;
- To promote and encourage the highest standards of education; and
- To grant the right to use the professional designation of Chartered Market Technician (CMT) to those members who successfully complete the Program and agree to abide by the MTA Code of Ethics.
In order to be granted your CMT designation, you must meet the following requirements:
- Successful completion of all three (3) levels of the CMT Exam.
- Have obtained 'Member Status' within the MTA.
- Have been gainfully employed in a professional analytical or investment management capacity for a minimum period of three (3) years and must be regularly engaged in this capacity at the time of passing all three (3) levels of the CMT Exam.
The CMT program includes three levels of examinations, each building on the previous. The levels progressively narrow in focus while increasing the emphasis on higher-order reasoning.
- Level I focuses on a basic knowledge of the terminology and analytical tools used in technical analysis.
- Level II measures the candidate's competency in the application of concepts, theory, and techniques covered by the required readings.
- Level III tests the candidate's ability to integrate his or her understanding of the concepts identified in Level I with the practical application learned in Level II.
Material covered by the CMT program spans a wide variety of statistical and technical analysis of price patterns, volume history and measures of trend, momentum and volatility. Trading, automated trading systems, risk management, intermarket analysis, behavioral finance, market history and ethics are also featured in the course of study. The MTA has selected readings from various chapters of approved texts and published them (through Wiley Publishing) as preparation material for each of the three exams. Candidates can find an updated list of texts by clicking here.
Series 86 exemption
In February 2005, the U.S. Securities and Exchange Commission recognized levels 1 and 2 of the CMT exam as an alternative to the Series 86 Examination, as part of the rule changes filed by the North American Securities Dealers Regulation, now known as Financial Industry Regulatory Authority (FINRA) and NYSE. This recognition on the part of securities regulators and the self-governing bodies of the securities industry provided significant new credibility to technical analysis.
- Algorithmic trading
- Candlestick chart
- Chartered Financial Analyst
- Dow theory
- Elliott wave principle
- High-frequency trading
- Intermarket analysis
- Market Technicians Association
- Mathematical finance
- Point and figure chart
- Relative Strength Index (RSI)
- Stock valuation
- Technical analysis
- Trend line