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YoungEconomist · 08-07-2008, 05:30 PM

1. I've never taken a class in finance, nor have I taken a class in financial economics. I'd like to read a good textbook on financial economics. Do you guys have any recommendations for good fiancial economics textbooks? I'm thinking it should probably be a book geared towards undergrads (given that I've never taken a course in the field, and I've never taken a graduate level econ course). I'll be finished with my math minor once I read the book, so it can be somewhat mathematically rigorous (in other words, you don't have to recommend a book that avoids the mathematical models, etc). In case it makes a difference, I will also be finished with my economics major by the time I read the book. Anyway, I'm probably "talking" too much, just recommend any financial economics books that you TMers like.

2. I've been wondering lately about being an RA in grad school vs being a TA in grad school. It seems that it's fairly easy to be a TA, but I have no idea how easy it is to become an RA. How does the RA thing work? At most schools, is it usually reserved for older PhD students, or can you get them your 1st and 2nd year as well? In the profiles and results thread, I've noticed that some schools (mainly TAMU) often offer RA positions to first year students, but I don't know of any other schools that tend to do this. What I'm basically asking is this, if someone had a strong preference for RA work over TA work, would they easily be able to satisfy this preference? It just seems that RA work would benefit one more in terms of finishing a disertation, because you'd be around research more and thinking/learning about research more. You'd also be watching (and learning from) someone who is already fairly good at producing high level research. I realize that being a TA also has it's benefits (especially if you teach your own course) but I think for me personally, an RAship would serve me better than a TAship. Anyway, feel free to offer up any answers, information, advice, etc on the topic.

Canuckonomist · 08-07-2008, 05:56 PM

1. Danthine and Donaldson "Intermediate Financial Theory" is a good one. It may be a little advanced, and if it is, then perhaps Bodie et. al "Investments". It's sort of an MBA text, which makes it a bit shy on the math in some parts, and so it's not that great in that respect. If you really like D&D (not Dungeons and Dragons...) the I'll recommend Jarrow and Turnbull "Derivative Securities" to learn more about the financial Markets side of things.

2. I don't know what the pre-reqs are to being an RA. I asked around, and in my Undergrad, I was an RA after second year. I also got 2 RA jobs this year, after finishing my undergrad. I am currently working for two separate professors. So, I suppose you can be an RA for anyone if you ask around and strut your stuff.

FOSD · 08-07-2008, 05:59 PM

1) maybe for some more applied stuff, but very helpful: Fixed Income Analysis by Fabozzi.

2) RA responsibilities differ from prof to prof and can range from grading and photocopying to active research, number crunching, statistical analysis, or proofs.

wonderful · 08-08-2008, 06:02 AM

Regarding question 2 on RA, the answer would probably vary from departments to departments. That said, one of the most popular way of getting an RA position is to take a class by the professor with whom you would like to work for as an RA. It could work the other way round. Sometimes you took the class with no intention of becoming RA for the instructor; however, you really like the subject and the professor research during the time taking the class. After that, you may be interested in becoming his RA. Certainly, your performance in his class will play a role in granting you an RA position.

As for kind of jobs that an RA usually does, it depends on a number of factors such as your experience and strength, the research you are involved with and so on. For the beginning, you will most likely to do literature review, data entry and/or data analysis for empirical work. As you get more experienced the professor may invite you to coauthor with him. Overall, RA is a great opportunity to improve our research skills, in many cases we may end up with dissertation ideas or better yet good publications.

Have A Great Day!

LouisBD · 08-08-2008, 09:20 AM

If your interested in derivative pricing than I fully recommend Baxter and Rennie: Financial Calculus: An Introduction to Derivative Pricing
It is just such a great book (my number 1). Very short and beautifully written and it will give you the flavor of what it is all about. Although a small warning, it is not that practical oriented but shows more the deeper mechanics. While it is not that mathematical, people without some quantitative background often struggle with this book.

Exodus · 08-10-2008, 12:29 AM

1. Maybe you should look at "corporate finance" (Jean Tirole). It's a pretty good textbook, from a prestigious economist. This book has a Industrial Organization focus... very interesting.

2. I don't know man.

TruDog · 08-10-2008, 03:58 AM

At most schools, first-year students are not RAs (unless it's a job that requires no work and essentially serves as a fellowship). At Wisconsin, there are very few RAs who are not at least in their third year of study.

As you get past prelims and the field paper, you get to know professors better and get a better chance of becoming an RA. Generally, it just takes time.

vanRijn · 08-10-2008, 03:29 PM

1-if you have never actually studied finance, I'd definitely start with a MBA level course, just to familiarize with the basic ideas. I found the one by Grinblatt and Titman pretty good, and I sincerely recommend to start from it, as it would make for a pretty enjoyable and quick read. Then you can go on to something serious (and demanding--I for one would find it hard to work my way thru those without an instructor) about asset pricing. if you are into macro/metrics stuff, john cochrane's book would be my pic. key words: consumption-based model, stochastic discount factor, GMM: its the economists' way to finance. There are other approaches as well to asset pricing and derivatives, which probably require mandatory familiarity with stochastic calculus. The book by darrell duffie is another classic. I dont want to scare you, but I reiterate that self studying books like these is very very hard, imho. There's also the field of corporate finance if you are more micro/infoecon oriented, ad in that case I absolutely recommend the theory of corp finance by jean tirole, a terrific book for both scope and depth. easy to self study, especially after G&T and some advanced micro.
have fun (:

Canuckonomist · 08-10-2008, 04:05 PM

I will agree with vanRijn and stress that books like Duffie are for the more mathy people who have already been exposed to some financial economics AND alittle stochastic calculus. I would begin with an MBA level text.

desimba · 08-11-2008, 05:52 AM

Quote:

Originally Posted by YoungEconomist

1. I've never taken a class in finance, nor have I taken a class in financial economics. I'd like to read a good textbook on financial economics. Do you guys have any recommendations for good fiancial economics textbooks? I'm thinking it should probably be a book geared towards undergrads (given that I've never taken a course in the field, and I've never taken a graduate level econ course). I'll be finished with my math minor once I read the book, so it can be somewhat mathematically rigorous (in other words, you don't have to recommend a book that avoids the mathematical models, etc). In case it makes a difference, I will also be finished with my economics major by the time I read the book. Anyway, I'm probably "talking" too much, just recommend any financial economics books that you TMers like.

The book that was used in my MBA classes 2 years back at a top-25 school in the Mid-west: Principles of Corporate Finance by Brearley & Myers- Amazon.com: Principles of Corporate Finance (The Mcgraw-Hill/Irwin Series in Finance, Insurance, and Real Estate): Richard A. Brealey, Stewart C. Myers: Books Pretty safe book which covers the basics quite well I think.

Quote:

Originally Posted by YoungEconomist

2. I've been wondering lately about being an RA in grad school vs being a TA in grad school. It seems that it's fairly easy to be a TA, but I have no idea how easy it is to become an RA. How does the RA thing work? At most schools, is it usually reserved for older PhD students, or can you get them your 1st and 2nd year as well? In the profiles and results thread, I've noticed that some schools (mainly TAMU) often offer RA positions to first year students, but I don't know of any other schools that tend to do this. What I'm basically asking is this, if someone had a strong preference for RA work over TA work, would they easily be able to satisfy this preference? It just seems that RA work would benefit one more in terms of finishing a disertation, because you'd be around research more and thinking/learning about research more. You'd also be watching (and learning from) someone who is already fairly good at producing high level research. I realize that being a TA also has it's benefits (especially if you teach your own course) but I think for me personally, an RAship would serve me better than a TAship. Anyway, feel free to offer up any answers, information, advice, etc on the topic.

I am just starting off a PhD program in Business Economics at the University of Michigan and in our department, PhD students are appointed as RAs in all but the 3rd year of the program when we have to teach a course. Business Economics Group: PhD Program Overview
I understand that how much work one does as an RA depends on how hard the prof is willing to push and which stage of the program a student is in. In the early stages, it is likely to involve more of the low-hanging fruit such as lit searches or cleaning up some data sets, etc. It is actually pretty useful in some of these settings to have good programming skills. I know of someone who was able to get RA positions consistently during his PhD program because of his superior programming skills.

08-07-2008, 05:30 PM	#1 (permalink)
YoungEconomist TestMagic Guru Join Date: Dec 2006 Posts: 1,369	2 (Unrelated) Questions 1. I've never taken a class in finance, nor have I taken a class in financial economics. I'd like to read a good textbook on financial economics. Do you guys have any recommendations for good fiancial economics textbooks? I'm thinking it should probably be a book geared towards undergrads (given that I've never taken a course in the field, and I've never taken a graduate level econ course). I'll be finished with my math minor once I read the book, so it can be somewhat mathematically rigorous (in other words, you don't have to recommend a book that avoids the mathematical models, etc). In case it makes a difference, I will also be finished with my economics major by the time I read the book. Anyway, I'm probably "talking" too much, just recommend any financial economics books that you TMers like. 2. I've been wondering lately about being an RA in grad school vs being a TA in grad school. It seems that it's fairly easy to be a TA, but I have no idea how easy it is to become an RA. How does the RA thing work? At most schools, is it usually reserved for older PhD students, or can you get them your 1st and 2nd year as well? In the profiles and results thread, I've noticed that some schools (mainly TAMU) often offer RA positions to first year students, but I don't know of any other schools that tend to do this. What I'm basically asking is this, if someone had a strong preference for RA work over TA work, would they easily be able to satisfy this preference? It just seems that RA work would benefit one more in terms of finishing a disertation, because you'd be around research more and thinking/learning about research more. You'd also be watching (and learning from) someone who is already fairly good at producing high level research. I realize that being a TA also has it's benefits (especially if you teach your own course) but I think for me personally, an RAship would serve me better than a TAship. Anyway, feel free to offer up any answers, information, advice, etc on the topic.

08-07-2008, 05:56 PM	#2 (permalink)
Canuckonomist Loving the Ivory Tower Join Date: Dec 2007 Location: Kingston, Canada Posts: 357	1. Danthine and Donaldson "Intermediate Financial Theory" is a good one. It may be a little advanced, and if it is, then perhaps Bodie et. al "Investments". It's sort of an MBA text, which makes it a bit shy on the math in some parts, and so it's not that great in that respect. If you really like D&D (not Dungeons and Dragons...) the I'll recommend Jarrow and Turnbull "Derivative Securities" to learn more about the financial Markets side of things. 2. I don't know what the pre-reqs are to being an RA. I asked around, and in my Undergrad, I was an RA after second year. I also got 2 RA jobs this year, after finishing my undergrad. I am currently working for two separate professors. So, I suppose you can be an RA for anyone if you ask around and strut your stuff. _ _ _ _ SIG _ _ _ _ Attending Queen's University Applying to: UChicago, NWU, Yale, NYU, Columbia, Michigan, Minnesota, Cornell, Rochester, BU, Toronto Ph.D comics by Jorge Cham... Now I can actually say they relate.

08-08-2008, 09:20 AM	#5 (permalink)
LouisBD Eager! Join Date: Jun 2008 Posts: 43	If your interested in derivative pricing than I fully recommend Baxter and Rennie: Financial Calculus: An Introduction to Derivative Pricing It is just such a great book (my number 1). Very short and beautifully written and it will give you the flavor of what it is all about. Although a small warning, it is not that practical oriented but shows more the deeper mechanics. While it is not that mathematical, people without some quantitative background often struggle with this book. Last edited by LouisBD : 08-10-2008 at 01:14 PM.

08-10-2008, 03:58 AM	#7 (permalink)
TruDog TestMagic Guru-in-Training Join Date: Aug 2006 Location: Midwest US Posts: 588	At most schools, first-year students are not RAs (unless it's a job that requires no work and essentially serves as a fellowship). At Wisconsin, there are very few RAs who are not at least in their third year of study. As you get past prelims and the field paper, you get to know professors better and get a better chance of becoming an RA. Generally, it just takes time. _ _ _ _ SIG _ _ _ _ University of Wisconsin-Madison--2nd Year

08-10-2008, 04:05 PM	#9 (permalink)
Canuckonomist Loving the Ivory Tower Join Date: Dec 2007 Location: Kingston, Canada Posts: 357	I will agree with vanRijn and stress that books like Duffie are for the more mathy people who have already been exposed to some financial economics AND alittle stochastic calculus. I would begin with an MBA level text. _ _ _ _ SIG _ _ _ _ Attending Queen's University Applying to: UChicago, NWU, Yale, NYU, Columbia, Michigan, Minnesota, Cornell, Rochester, BU, Toronto Ph.D comics by Jorge Cham... Now I can actually say they relate.

08-07-2008, 05:59 PM	#3 (permalink)
FOSD Trying to make mom and pop proud Join Date: Aug 2008 Posts: 5	1) maybe for some more applied stuff, but very helpful: Fixed Income Analysis by Fabozzi. 2) RA responsibilities differ from prof to prof and can range from grading and photocopying to active research, number crunching, statistical analysis, or proofs.

08-08-2008, 06:02 AM	#4 (permalink)
wonderful Trying to make mom and pop proud Join Date: Jun 2008 Posts: 11	Regarding question 2 on RA, the answer would probably vary from departments to departments. That said, one of the most popular way of getting an RA position is to take a class by the professor with whom you would like to work for as an RA. It could work the other way round. Sometimes you took the class with no intention of becoming RA for the instructor; however, you really like the subject and the professor research during the time taking the class. After that, you may be interested in becoming his RA. Certainly, your performance in his class will play a role in granting you an RA position. As for kind of jobs that an RA usually does, it depends on a number of factors such as your experience and strength, the research you are involved with and so on. For the beginning, you will most likely to do literature review, data entry and/or data analysis for empirical work. As you get more experienced the professor may invite you to coauthor with him. Overall, RA is a great opportunity to improve our research skills, in many cases we may end up with dissertation ideas or better yet good publications. Have A Great Day!

08-10-2008, 12:29 AM	#6 (permalink)
Exodus Trying to make mom and pop proud Join Date: May 2008 Posts: 9	1. Maybe you should look at "corporate finance" (Jean Tirole). It's a pretty good textbook, from a prestigious economist. This book has a Industrial Organization focus... very interesting. 2. I don't know man.

08-10-2008, 03:29 PM	#8 (permalink)
vanRijn Trying to make mom and pop proud Join Date: Oct 2007 Posts: 13	1-if you have never actually studied finance, I'd definitely start with a MBA level course, just to familiarize with the basic ideas. I found the one by Grinblatt and Titman pretty good, and I sincerely recommend to start from it, as it would make for a pretty enjoyable and quick read. Then you can go on to something serious (and demanding--I for one would find it hard to work my way thru those without an instructor) about asset pricing. if you are into macro/metrics stuff, john cochrane's book would be my pic. key words: consumption-based model, stochastic discount factor, GMM: its the economists' way to finance. There are other approaches as well to asset pricing and derivatives, which probably require mandatory familiarity with stochastic calculus. The book by darrell duffie is another classic. I dont want to scare you, but I reiterate that self studying books like these is very very hard, imho. There's also the field of corporate finance if you are more micro/infoecon oriented, ad in that case I absolutely recommend the theory of corp finance by jean tirole, a terrific book for both scope and depth. easy to self study, especially after G&T and some advanced micro. have fun (:

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