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KackToodles
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September 20th, 2008, 11:42 pm

QuoteOriginally posted by: StatGuyQuote I'm actually not sure if most people applying to MFE programs really want 'to be a quant'. Many MFE's that I have met explicitly told me that they don't want to be a quant, just use the program to switch into financial industry given their quantitative background. If this is the case why don't they enroll for a Masters in Finance, which will teach them about the broader aspects of finance rather than just the quant side and be more profitable for them.SG SG, many of them probably applied to both MBA and MFE programs. They are attending the MFE program because that's where they were admitted. It's much more competitive to gain admission to a top MBA program, such as those at harvard and stanford. You can look up the stats; at Stanford, admission to MBA is somethink like 20,000 applicants for about 150 - 300 slots! Almost all those admitted had some management or consulting experience and top grades.
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twofish
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September 21st, 2008, 2:21 am

QuoteOriginally posted by: PaulI feel very angry about the state of education in finance and risk management, at all levels.It's part of the generally dysfunctional state of education in general. Part of the problem is that there are pressures to study the most profitable things rather than things that will actually help you in a crisis situation when no one knows what to do. Some of the more useful things to study are things like art, history, philosophy, and literature, which like risk management seems totally useless until things fall apart and you are trying to figure out what to do.
 
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mirage007
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September 21st, 2008, 4:53 am

Hi Everyone,As a recently admitted student to MFE program just starting the school year, i wanted to share my two cents. Also, although i read the forums quite often, this is my first post that i felt I'd be able to contribute meaningfully.I'm sure a lot of people are also in the same boat, so let me share my somewhat more positive perspective.I think it makes even more sense to enter such a program during a time of tremendous change and perhaps chaos. Perhaps the finance industry is shot dead, but the beauty of this program is the mix of knowledge it provides being at the intersection of economics/finance/comp sci/ and mathematics. Obviously no program can boast to teach each one of these topics exhaustively enough, but i always feel this is the type of opportunity, that for those that are proactive enough, can give them a tremendous amount of knowledge in the areas they are lacking, sort of like patching up one's weaknesses, and reaffirming one's strengths.These are just the basic (or not so basic) tools needed to deal with a more quantitative and complex world in general. Maybe finance won't bounce back again for a long while, but the world is sure not getting any simpler, and i just view this program as kind of the survival guide to chaos. I've always wanted to work in the finance industry, but i don't think i'd be too moved if it all fell to pieces, because i just know these skills are invariably useful in our increasingly technological world.As for the opportunity+tuition costs, they are in the range of 100-200k for a year. The average person in their entire lifetime earns 3-4.5 million ( a fact i remembered from HS econ) and i'm sure that figure has increased quite a bit since then. That's not gonna change one's level of comfort or lifestyle all that dramatically at all. Lastly, I didn't get in this program planning on being average, and if i'm gonna beat the average, i have a feeling the standard deviation is much higher than what the opportunity costs are.In essence, this field is the study of change, as applied to the {financial markets}. Fine, financial markets are dead, plug in what you will in {}. The way i see it as long as there's change, there'll be change in my pocket :-)
 
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legacy
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September 21st, 2008, 8:52 am

QuoteOriginally posted by: StatGuyQuote I'm actually not sure if most people applying to MFE programs really want 'to be a quant'. Many MFE's that I have met explicitly told me that they don't want to be a quant, just use the program to switch into financial industry given their quantitative background. If this is the case why don't they enroll for a Masters in Finance, which will teach them about the broader aspects of finance rather than just the quant side and be more profitable for them.SGMy guess is that most of these MFE students are probably more comfortable with numbers and mathematical concepts than financial accounting and economics theory. Their primary targets will be structuring/quantitative trading/strategy position at I-bank, and they are probably less interested in looking into corporate finance. IMHO, if these positions at I-bank are to decrease significantly in the future, the number of MFE applicants too may decrease proportionally.
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StatGuy
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September 21st, 2008, 10:02 am

Quote It's much more competitive to gain admission to a top MBA program, such as those at harvard and stanford. You can look up the stats; at Stanford, admission to MBA is somethink like 20,000 applicants for about 150 - 300 slots! Almost all those admitted had some management or consulting experience and top grades.This would be my line of thinking as well. As stated on this forum before, "soft skills is the thing that most quants cite when asked what they feel they lack", so I would question if the mentality of those going into highly technical masters courses actually have the right traits to progress further in a company than just a specialist role like quant. Sure they may not want to do this, but if they want to progress from a technical role to a managerial role in future this is where the problems start as it takes a mentality switch and improved softer skills.Quote Some of the more useful things to study are things like art, history, philosophy, and literature, which like risk management seems totally useless until things fall apart and you are trying to figure out what to do.There is just too much to study so my feeling is that students study what seems more useful at the present time to maximize future gain. Also, if you account for one downturn in 10 years then it is understandable that students will still go with their choices that look more attractive, as extreme events (like the present) don't happen every year. QuoteI would disagree (based on what I have seen in my school and otherwise). Getting a job (post PhD) is way easier in industry than academia. Only 1 in 10 PhDs (from a top 10 school) will get a chance to be an Asst. Professor. Others have to find something else mostly in the Industry. Some even go as far as doing an MFE after their doctorate.You also don't have the same level of publishing pressures in industry. I think it is unfair to think of academia as the 2nd option, as from what I have seen you work longer hours in academia for less pay, so understandably some leave to find jobs in industry. As it has been discussed here before you don't become an academic to increase your wealth.QuoteI bet if you took a poll of all the managing directors or CEOs at top banks, 95% of them would not want to trade their current jobs and lifestyle for a tenured academic job at oxford or harvard. In fact, 95% is probably a conservative estimate.The poll is biased. Same as if you sample a population of top profs in top schools I bet 95% of them want to stay in academia. Some of them do consultancy work in industry. Quotethis proves that good industry jobs are hard to get -- phd have to go for additional training to qualify.If a PhD wants to get a job in their field they will if they good. It's only if they want to change direction they do additional training so the focus on their PhD is less going forward. SG
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AbhiJ
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September 21st, 2008, 1:04 pm

QuoteOriginally posted by: legacyI'm actually not sure if most people applying to MFE programs really want 'to be a quant'. Many MFE's that I have met explicitly told me that they don't want to be a quant, just use the program to switch into financial industry given their quantitative background. Very true. QuoteOriginally posted by: StatGuyIf this is the case why don't they enroll for a Masters in Finance, which will teach them about the broader aspects of finance rather than just the quant side and be more profitable for them.SGThis is because lot of MFE are international students who want to move to US where they feel most of the opportunities are present.In US there are hardly any descent MS Finance programs.
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StatGuy
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September 21st, 2008, 1:43 pm

Quote This is because lot of MFE are international students who want to move to US where they feel most of the opportunities are present.In US there are hardly any descent MS Finance programs. Or perhaps good finance/MBA course are harder to get into than MFEs. SG
 
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AbhiJ
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September 21st, 2008, 2:56 pm

QuoteOriginally posted by: StatGuyQuote This is because lot of MFE are international students who want to move to US where they feel most of the opportunities are present.In US there are hardly any descent MS Finance programs. Or perhaps good finance/MBA course are harder to get into than MFEs. SGRemove the word finance from your sentence and it is true.Other than Princeton (25 places ) there aren't any good MS Finance programs in US unlike UK where LSE alone has 10 finance/eco related Masters.
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KackToodles
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September 21st, 2008, 4:03 pm

QuoteOriginally posted by: mirage007In essence, this field is the study of change, as applied to the {financial markets}. Fine, financial markets are dead, plug in what you will in {}. The way i see it as long as there's change, there'll be change in my pocket :-) Wow, do you really think that you can learn all you need to be a "change leader" in the space of a 12 - 16 month masters program?! If so, all those people spending 4 - 6 years (= 48 to 72 months) in a full time phd program must sure be slow learners!
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HyperGeometric
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September 21st, 2008, 8:08 pm

QuoteOriginally posted by: KackToodlesQuoteOriginally posted by: StatGuyQuote I'm actually not sure if most people applying to MFE programs really want 'to be a quant'. Many MFE's that I have met explicitly told me that they don't want to be a quant, just use the program to switch into financial industry given their quantitative background. If this is the case why don't they enroll for a Masters in Finance, which will teach them about the broader aspects of finance rather than just the quant side and be more profitable for them.SG SG, many of them probably applied to both MBA and MFE programs. They are attending the MFE program because that's where they were admitted. It's much more competitive to gain admission to a top MBA program, such as those at harvard and stanford. You can look up the stats; at Stanford, admission to MBA is somethink like 20,000 applicants for about 150 - 300 slots! Almost all those admitted had some management or consulting experience and top grades. If I could rename the topic, I would add MBA to the list. To address the point made above, here are some statisticsStanford MBA 2009 Class Profile says:Total Applications 5741New Students 362 (note that offers exceed enrollment) Harvard's Profile:Total Applications 8,661Total MBA Enrollment 900 (note that offers exceed enrollment) Harvard's avg entering class GPA 3.66MIT avg GPA of entering class of 3.5.
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KackToodles
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September 21st, 2008, 9:13 pm

QuoteOriginally posted by: HyperGeometricStanford MBA 2009 Class Profile says:Total Applications 5741New Students 362 (note that offers exceed enrollment) Harvard's Profile:Total Applications 8,661Total MBA Enrollment 900 (note that offers exceed enrollment) Harvard's avg entering class GPA 3.66MIT avg GPA of entering class of 3.5.It appears that the number of MBA applications have dropped dramatically in last 5 years while slots have remained fixed... the value of masters degrees (MBAs and MFEs) are gradually being recognized for being dubious (as I've always said in other threads). But you don't need to make insinuations about what the admissions rates are: it is basically 7% at Stanford and 11% at Harvard in 2008-9. Businessweek and US News publishes an annual issue that spells out all the rates. http://education.yahoo.com/college/esse ... lAdmission Stats cut and pasted from above web site: * In last year's admissions cycle, the acceptance rates of the top schools remained very low. Stanford was in the single digits, accepting only 7% of its applicants (7,047 students applied for 364 slots).** * The Ivies remained intensely competitive, with acceptance rates of 11% for Columbia and 13% for Wharton, Dartmouth and Harvard. Last year Dartmouth received 14 to 15 applications for every first-year spot. Wharton and Harvard had the greatest number of applicants--just over 8,400 for both schools.
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mirage007
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September 22nd, 2008, 2:41 am

QuoteOriginally posted by: KackToodlesQuoteOriginally posted by: HyperGeometricStanford MBA 2009 Class Profile says:Total Applications 5741New Students 362 (note that offers exceed enrollment) Harvard's Profile:Total Applications 8,661Total MBA Enrollment 900 (note that offers exceed enrollment) Harvard's avg entering class GPA 3.66MIT avg GPA of entering class of 3.5.It appears that the number of MBA applications have dropped dramatically in last 5 years while slots have remained fixed... the value of masters degrees (MBAs and MFEs) are gradually being recognized for being dubious (as I've always said in other threads). But you don't need to make insinuations about what the admissions rates are: it is basically 7% at Stanford and 11% at Harvard in 2008-9. Businessweek and US News publishes an annual issue that spells out all the rates. http://education.yahoo.com/college/esse ... lAdmission Stats cut and pasted from above web site: * In last year's admissions cycle, the acceptance rates of the top schools remained very low. Stanford was in the single digits, accepting only 7% of its applicants (7,047 students applied for 364 slots).** * The Ivies remained intensely competitive, with acceptance rates of 11% for Columbia and 13% for Wharton, Dartmouth and Harvard. Last year Dartmouth received 14 to 15 applications for every first-year spot. Wharton and Harvard had the greatest number of applicants--just over 8,400 for both schools.Ok, so supposed this is true, and all MFE and MBA's are worthless, regardless of schools. What is someone at that stage of life supposed to do then?It's like a catch 22. There's a flight to safety, employers want the most experienced people to work for them, your at the stage where that portion of your career hasn't started, and you are deciding to either go to higher education, or wing it and find some job. I don't think the best advice would be to find any random job you can to weather it out.Because 1, you most likely will not find what you want to do. 2 the experience is not really gonna contribute to push you in the direction you want to go. 3 the wage is bad anyway given the economic conditions.If the bad conditions persist, all these people will have more accreditations than you, and assuming they are no less resourceful than you, can at least find a job just as bad as yours. If things do improve, your additional experience is not gonna contribute to where you want to go, also, you'd still have to go to school to be on par with them on paper, at which point opportunity costs will be increasing. And the debate of the degree of significance of rankings and signaling effects aside, they do contribute to an employer's hiring decision however small.Hence, i think it just makes sense to get your degrees done and out of the way so that there are no biases against you, or blocked opportunities in the future, and i think the earlier the better.And lastly, being a "change leader" wasn't quite what i wanted to say in my last post, although i'm not quite sure only PhD's can be considered change leaders. Most outstanding people in the industry don't have PhD's, nor do most leaders from any country. I think it's a completely different skill set needed to succeed at the challenges of life, as opposed to the challenges provided by a very academic undertaking. And if you got the former part down, then even though an MFE may be a rough set of tools to use to go into the world, but its enough to get all your bases covered, and i don't think you can get any more prepared for uncertainty than that.
 
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twofish
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September 22nd, 2008, 3:27 am

QuoteOriginally posted by: mirage007It's like a catch 22. There's a flight to safety, employers want the most experienced people to work for them, your at the stage where that portion of your career hasn't started, and you are deciding to either go to higher education, or wing it and find some job. I don't think the best advice would be to find any random job you can to weather it out.Finding some field that you are interested in and then getting the best job you can in that field doesn't seem like a bad strategy. There are all sorts of jobs out there.QuoteBecause 1, you most likely will not find what you want to do. 2 the experience is not really gonna contribute to push you in the direction you want to go. 3 the wage is bad anyway given the economic conditions.For 1) and 3) you have to deal with the fact that the market will not always give you what you want, so you have to make do with the best that you can get. As far as 2) you have to figure out what you really want to do, and if you are careful about it, then skills can be quite transferable between fields. QuoteIf the bad conditions persist, all these people will have more accreditations than you, and assuming they are no less resourceful than you, can at least find a job just as bad as yours.If you have a job, you can get experience. QuoteHence, i think it just makes sense to get your degrees done and out of the way so that there are no biases against you, or blocked opportunities in the future, and i think the earlier the better.I really don't think it does since you really don't know what the big opportunities are in the future or what the hot jobs will be five years from now. By the time someone figures out where the big bucks are, it's too late to move in. The best thing to do is to figure out what is intrinsically desirable to you and then do that.Also education is something that you just don't get "out of the way." To survive in the modern economy, you have to be constantly learning new stuff. Where you end up learning is another question, and sometimes the classroom is not the best place to get an education. I think of my job as a post-post-post-post-doc.QuoteI think it's a completely different skill set needed to succeed at the challenges of life, as opposed to the challenges provided by a very academic undertaking.I don't think so. Personally, I think that the Ph.D. is one of the very few things in academia that gives you a taste of the "real world." It's not until you get to the level that you start reading textbooks, and think to yourself, this is either all wrong or all useless.QuoteAnd if you got the former part down, then even though an MFE may be a rough set of tools to use to go into the world, but its enough to get all your bases covered, and i don't think you can get any more prepared for uncertainty than that.The thing that you don't get with an MFE, is the suddenly feeling of horror when you go down two years into your Ph.D. and the realize that the approach that you've been taking is completely wrong, and that you have to backtrack and figure out another strategy. The other thing is that in a Master's degree, you are learning things that presumably someone else knows, whereas in a Ph.D., you are trying to learning things that *no one* knows. In the real world, you'll find that the tools that you were given were sub-optimal, your teachers may have been misinformed, and that you have to make do with whatever you have, to get something (anything) done.
 
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twofish
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September 22nd, 2008, 3:32 am

One piece of advice is to make sure that you are living your own dream rather than someone elses. The thing about master's programs is that you need to realize that they are trying to sell you something and to realize what it is that they are trying to sell you. In the case of Harvard or Stanford, a lot of what they are trying to sell you is the feeling of being in an exclusive club and the notion that if you get accepted, that well you are better than everyone else and you will be rewarded with lots of wealth and power.That's not necessarily a bad thing, but you just need to realize that this is what you are buying and what they are selling. The problem with this system is that it creates a notion of an education as something that merely provides technical skills for getting a job, without seeing education as something is part of life.
Last edited by twofish on September 21st, 2008, 10:00 pm, edited 1 time in total.
 
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KennyMing
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September 22nd, 2008, 4:48 am

But do you think the market will be recovered within 2-3 years?There may be a demand of quants to develop new models and new derivatives. What do you think?
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