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Starting off in Finance: advice required

Hi,

I just joined your forum, had it recommended by a friend.
I wanted some advice from the community here.
A bit about my background here. I just finished my Bachelor's in Mechanical Engineering from the Indian Institute of Technolgy, Kharagpur. Thats a fairly core technical engineering background, as you see. I accepted a position as an Analyst in JP Morgan. Its an IT job, per se, but I like to look at it more as a networking and learning opportunity.

I have an interest in the analytical side of things, and I would like to move into core finance as soon as I can.
On the other hand, I have a managerial knack too, and I did contemplate an MBA sometime back.
So, I have two broad queries:

1) In the context of "moving" into finance, what learning path should I take ? should I:
a) self-learn Hull, Shreve, Neftci etc.---you get the general idea, then apply for a pertinent job and "learn-on-the-floor" ?
or b) get someone to teach me(go back to school) ?
or c) take a certification course (eg. CFA) ?
or d) a linear combination of some or all of the above ?

2) any advice on the MBA/MFE conundrum?(maybe both? I hear CMU and UCB have dual programmes; or is it still better in steps?)

I am specifying some obvious variables : the pay is an attraction for me , and growth is too.

I understand that finally it might boil down to what I "like" or what I "want", but I am curious as to what the answers will be to a control situation, a hypothetical scenario, no personalizations.
Its a rough picture I drew, and I did not go into the details. I would love to hear from you guys, and maybe I can fill in the finer lines.

Thanks a lot.
 

Joy Pathak

Swaptionz
If you want to be on the analytical side come to the US and get an MFE at one of the schools with good placement records. You're from IIT so you should not have much problems with placement. Lots of IIT alumni on the street.

IF you can get yourself a job in what you want to do already then self-learn and get it.
 
I would work for a few years in your current job and then you can revisit the decision to either try to move into your desired role there or do a MFE/MBA somewhere. In the meantime, start preparing for both through self-study, taking the GRE, etc.

MBA + CFA. Depends on what you want to do. If after your MBA you want to be an analyst at an IB then it will probably be useful.
 
@ Joy: Thanks for the advice. sounds good to me. one big hurdle in the way: I have a less than stellar GPA(around 6/10) and I did not do well in my math courses(had my bit of personal problems at that time), which, I am afraid is going to be a barrier to a good school at first. Any advice on how to offset this negative aspect? Maybe I can take some courses in core maths somewhere to "prove" myself , and if I do, are there any good schools in India(don't wanna go abroad just for this)you can recommend where I can get my math credits like these?
@Connor: Thanks. quick question: what about stagnation? Three years in an IT role(even at JPM) is going to be harder to explain than one,right? aprreciate your insight though !
 

Joy Pathak

Swaptionz
@ Joy: Thanks for the advice. sounds good to me. one big hurdle in the way: I have a less than stellar GPA(around 6/10) and I did not do well in my math courses(had my bit of personal problems at that time), which, I am afraid is going to be a barrier to a good school at first. Any advice on how to offset this negative aspect? Maybe I can take some courses in core maths somewhere to "prove" myself , and if I do, are there any good schools in India(don't wanna go abroad just for this)you can recommend where I can get my math credits like these?

A good work experience can offset bad GPA possibly, or a high GRE. Search the forums for choices on doing classes in India. I think there are some posts about it.
 
@joy, I sure hope that " good work experience can offset bad GPA". My future in Quant depends on that.
@Connor, I contemplated doing the CFA before (during and after my MBA), but was advised by professors and professionals in IB not to if I want to have a "non-fund management" related position at a IB. So, I would agree with you, if the IB job is fund related but not if it is in trading/M&A/Cap Market...). An MBA from a top 20 school with good internship and a good combination of finance courses is more than enough. It will get you into an Associate position.
 
@prithvisen it depends which direction you choose to go and what you mean by the "analytical side of things" and "core finance". An MBA and an MFE are two entirely different concentrations leading to very different career paths. I would not do both at the same time.

The MBA is focused on managerial coursework, even in a finance concentration. The core focus will be on accounting, valuation (corporate finance framework) and economics - it is unlikely that you would encounter a PDE or touch anything other than Excel (CMU's MBA would be the exception to the rule). By contrast, the MFE will focus more on the mathematics and programming elements, you will not look at the fundamentals of a business valuation nor will you open an 8 or 10k.

From my experience of having poked my head down both rabbit holes I'd offer the following:

MBA
  • ~5 years work experience to be considered by the top programs
  • Expected wall street paths: Consultant (big 3), Fundamental Analyst (Equity, Credit,..), Investment Banking Analyst, Prop Trader
MFE
  • Any Wall Street experience is valuable, but not necessary
  • Expected wall street paths: Quant Analyst (Options, FX, Commodities, ...), Strategic Analyst, Risk Management, Hi-Fre (algo) Trader, Quant Developer
For the MFE you would need to "prove yourself" if you feel your math grades are inadequate. For an MBA, a solid GMAT/GRE quant score and a strong letter explaining your personal situation would likely suffice.

Spend some time at JP and try to learn about the different positions and departments they have, both locally and abroad, and the skill-sets of the professionals you find working in those departments that you like. Writing the CFA and picking up a copy of Hull in the interim aren't bad ideas.
 
@joy: Thanks a lot, I will search in the forums as you advised.
@AlexandreH: sympathize with you on the first. Really need to find a way to offset my bad GPA. BTW, not really sure that I completely agree with your second. Thoughts on this anyone ?

@amanda.jayne:first off, thanks a lot for your time.
a little clarification on "analytical side of things" : I love number crunching, had lots of courses on ODE/PDE, Transforms, Numerical methods, FEM etc in my bachelors. I am learning the Stochastic Calculus now, started with Shreve, and am looking forward to more. I had to do a number of projects as part of my curriculum, and this entailed ots of modeling, simulations, numerical solutions etc. I am hoping to get myself started on some wave theory stuff and measure theory(un-related)soon.

its a dilemna I am in, and I think I might not be alone here: I have a genuine knack for analytical disciplines, I am the kind who loves to sit down with a physics problem and attack it for hours. Its my pleasure. Which is also the reason why I am drawn to Quant: lots of maths, lots of stats, lots of modelling, lots of calculus; you get the drift.
And then again, I am sure I would excel at a managerial position, and I enjoy it too.
so I guess, if these two balance each other out, other considerations might dictate which path I take, namely money and growth.
I find myself in a spot here: should I dig for an MBA or should I ready myself for the MFE?(the CMU MBA seems like the best of both worlds here. would you recommend it?)
I gather from your post that a fresh MFE would not rake in as much moolah as an MBA, if I am not mistaken.What about the long-term?


Is a minimum of 5 years experience necessary for a top-tier B-school? If that is really the case, then I would have to look to make it worth my while for those 5 years, I guess.....

I will definitely take your advice about JPM, its definitely a very vibrant company, lots of talented people. I will look to further myself in this place, taking your advice.

CFA without work experience was equated to death by my professors. will it look good in an interview if I have the L-1, L-2 and just 1/1.5 years of experience ?

In the meanwhile, I will learn the Stochastic Calculus, and will get my feet wet in some other finance books, dig a bit, self-learn.

I appreciate all the advice from everyone.
Looking forward to more.

Thanks !
 
My background is quite similar to yours - I've just followed it up with a random walk through various degrees/careers - sometimes I wish I had been born 10 years earlier, or 10 years later
smile.png


It seems you are leaning more towards the MFE and I wonder if you would find the options available to you post-MBA to be too limiting. If you truly enjoy the math and analytics, I would continue on this track and strengthen your resume while you make up your mind. Combining this with a L1 CFA should enable you to keep one foot in each pond in the interim.

Re: Stagnation - this is precisely where your MBA or MFE will come in. Think of them as your career's 'get out of jail free cards'. Any job is what you make of it.

Re: CFA - without work experience you can not become chartered. NYC doesn't seem to place much emphasis on it but in Canada it has become a pre-requisite (from what I hear, this is true in India and China as well). The L1 curriculum falls in line nicely with the finance taught in the MBA program. I don't see how sitting for it could be viewed as a death (?)

Re: B-School - I went to a tier 2 school for a variety of reasons, among which was a full scholarship and the expectation that I would wind up working in corporate finance somewhere in middle America. With hindsight being 20-20 and aspirations of a Wall Street career, I wouldn't recommend this route. I worked my way through boutique BDs in New York to one of the world's most prestigious funds, but it was an uphill battle requiring fortitude of the variety seldom exhibited by those of with two x-chromosomes
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To go back and do it again, I would only consider top 10 programs with emphasis on those in the north-east. 700+ GMAT and 5 years is the guideline, tho I'm seldom one to play by the rules.

Re: Salary Expectations - Its really a relative thing. I would say for those with prior relevant experience the MBA will offer a greater salary boost, for those with no prior relevant experience it's a game of chance. My MFE colleagues with no relevant experience are receiving mind boggling offers - when looking at MBA salaries do read between the lines, most don't wind up on Wall Street. Long term, well, I suppose most wind up at the MD level either way
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Re: CMU MBA- I have some knowledge of the program, though mostly anecdotal. The popularity of MFE programs is something rather recent. I have friends who completed both the MBA and undergraduate program and landed great NYC quant jobs immediately.
 
Decided! :) After reading your posts I have made my proper decision: After completing my MBA (That'll involve 2 years of experience) Ill go directly to MFE with no more experience causing to have breaks in studies. How about that? The concern is not salary. Just preparing myself for PhD. I even have choices of thesis to write about. Theoretical knowledge seems to be much more valuable for PhD programs and the process of completing rather than having enormous working experience.
 
Decided! :) After reading your posts I have made my proper decision: After completing my MBA (That'll involve 2 years of experience) Ill go directly to MFE with no more experience causing to have breaks in studies. How about that? The concern is not salary. Just preparing myself for PhD. I even have choices of thesis to write about. Theoretical knowledge seems to be much more valuable for PhD programs and the process of completing rather than having enormous working experience.

Couldn't tell ya, I don't have a PhD
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Couldn't tell ya, I don't have a PhD

No problem it's never late. I'm a 4th year student BBA finance (quant - specialized faculty). These plans I provided extends my career after this year.
;)
 
@prithvisen, I earned an MBA at at top 20 school and Joined Lehman Brothers as an Associate (Corp Fin Media and Telecom). You don't need CFA to advise on M&A and IPO...Once you have an MBA from a good school, all recruiters care about is experience and deal sheet. Now, if you want to do Portfolio Management or Fund management (or maybe research), CFA would help a lot. Only few people in my group had CFA and those were not at an advantage in IB at all (for staffing or bonuses...). CFA is time consuming and you don't want to pursue it if you don't need it. If you do it pre-MBA, it would help you do better in Finance courses for sure and will give you more options for post MBA employment.
 
I know such examples also Alexandre. You are right.

CFA is time consuming

You have to pass only 3 exams and that's all. If you have gained high degrees from universities in finance field then it won't be time consuming at all. You have little to do. For example after completing my MBA, I won't have any trouble with regard to time to pass CFA. How do you think? (Provided that I pass it after MBA)
 
@Tsotne
what's ur goal for post-MBA? what kind of career/job do you want? How many years of experience do you have now? what do you plan on doing between now and the time you go to Business school?
 
@Tstone you must love being on Campus :D
I second Amanda in her questions and Add: to do a top MBA, you need 4-5 years of work experience.
 
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