Profile Evaluation: PhD Finance

[TedMosby]

Hi all - I would really appreciate some feedback on my chances of getting into a top 15 Finance PhD program. I'm also open to Econ if I would have a better shot. I think my work experience and grades are strong, but my LORs and quantitative coursework are weak. Not sure where the sum of that shakes out?

 

Age: 28-32

Nationality: US

Undergrad GPA: 3.8-3.9 GPA (summa cum laude)

GRE: 170Q, 166V

Work experience: Manage a sleeve within an absolute return-oriented fund. Fund sits inside an asset manager that is well known in the industry. I also contribute to investment research. We do not publish papers (work is proprietary). However, the topics are often reasonably similar to ones addressed in academia.

Relevant quantitative coursework: calculus 1, two stats courses, an intro-level programming course.

LOR: Have been out of school for a while, and professors have likely forgotten me, so academic recommendations unlikely to be strong.

 

As mentioned above, my biggest concerns are my quantitative coursework and LORs. In terms of the coursework, I'm planning to take 2-3 non-degree courses to try improve this (but not sure if that's enough?). In terms of the LORs, I should be able to get good work-related ones. I understand that this is generally frowned upon - does that change if my work LORs are from folks with PhDs and have published in academic journals?

Edited February 4, 2019 by TedMosby

[zshfryoh1]

Industry LOR's are fine as long as they are PhD's who have published in top tier academic journals. For an industry LOR, someone publishing in mid and lower tier journals will not help much. However, one stellar LOR from a PhD who regularly publishes in top finance journals could possibly be enough even if the other two are from less well published PhD's.

 

As far as your research experience goes, adcoms will have no way to know if it actually is comparable to what is done in academia or not - unless the work was done together with a PhD holding LOR writer who mentioned this in the LOR, and the adcoms probably would not trust that assessment unless the LOR writer publishes in top journals.

 

If you take calc II, calc III and linear algebra a top 50 that accepts self-funded students (there are a few) might accept you and you would have a decent chance at top 100's. With real analysis and a serious stats/econometrics class or two you would be competitive for top 50's, possibly even top 30's.

 

I think a top 15 is simply out of reach without a lot of improvements to your profile which would take way too much time. I don't think your chances are better in econ. While econ PhD programs admissions are a little less competitive outside the top 15 they are also less willing to take "older" (over 30 year old) students than finance PhD programs. If you go outside the top 50, whether in econ or finance, your odds will improve.

 

I would like to know why do you want to go for a PhD? You have a good industry job, and if it is just to move to a better job in finance, an MBA or MFE/MQF or a some other finance oriented masters degree would accomplish the same thing (depending on where in the financial industry you want to go) in far less time. If it is for the prestige of having three extra letters after your name, you would be perfectly fine going to a top 100. If you want to teach, once again a top 100 would do just as well. The only reason to target top programs is if you truly want to be a researcher in academia. While not all students end up taking that route at the end of their PhD's, those students who enter top PhD programs with any other goals in mind often don't end up completing the program.

[TedMosby]

Thanks a lot for the feedback, zshfryoh1!

 

I want to go for a PhD in order to become a professor. I want to do research and teach full-time. Absolutely not related to advancing within the industry, as I'm not sure it would even help. Even if there's a modest benefit, it would certainly be much, much faster for me to advance by just continuing with with my current role.

 

In terms of the coursework - if I were able to self study calc II and III (I took Calc BC in high school and I understand that is similar to calc 1 + 2), and then take non-degree courses at a respected university in linear algebra and real analysis and get As in both, would that be enough to signal to adcoms that I'm capable of learning the more advanced quantitative material?

 

On the journals - by "top tier," do you mean top 5, top 10, top 50, or top 100? Pardon the naive question.

 

On the LORs - if I can get a LOR from a known professor, but the content is pretty generic (due to me being out of school for so long), does that help at all?

Edited February 5, 2019 by TedMosby

[YaSvoboden]

I think you should consider an MFE or something similar as prep for a PhD. It is a lot of work, but it would address your quant coursework issue and the lack of letters. Even a lower-tiered masters in econ would get you back into academia and let you take the necessary courses. Without calc 2, 3, and LA you are not ready for the coursework in a PhD. As Z mentioned, analysis and some extra stats / metrics would be nice as well. An MFE would also help advance your career if you choose not to go the PhD route.

 

Also, I imagine you are in a big city with a university or two nearby. Consider attending workshops. Those will give you a good idea of what academia is all about.

[zshfryoh1]

Thanks a lot for the feedback, zshfryoh1!

 

I want to go for a PhD in order to become a professor. I want to do research and teach full-time. Absolutely not related to advancing within the industry, as I'm not sure it would even help. Even if there's a modest benefit, it would certainly be much, much faster for me to advance by just continuing with with my current role.

 

In terms of the coursework - if I were able to self study calc II and III (I took Calc BC in high school and I understand that is similar to calc 1 + 2), and then take non-degree courses at a respected university in linear algebra and real analysis and get As in both, would that be enough to signal to adcoms that I'm capable of learning the more advanced quantitative material?

 

On the journals - by "top tier," do you mean top 5, top 10, top 50, or top 100? Pardon the naive question.

 

On the LORs - if I can get a LOR from a known professor, but the content is pretty generic (due to me being out of school for so long), does that help at all?

 

This is going to be a bit long.

 

When I say top tier I mean journals that are generally respected by finance academics at research universities, i.e. the journals which they read and which they would not be embarrassed to publish in. While no list is perfect, this paper is a good starting point. The data is somewhat old, but broadly speaking any of the journals that paper ranks as A, A- or B+, plus Review of Finance (which has moved up in recent years and is now an A/A- journal) would meet my criteria. Depending on where you are applying to, perhaps B journals would be OK. The top 3+2 journals (the 4 A journals in the paper plus RoF) count for more than the others since pretty much everyone reads and publishes in those journals. The top 5 general interest econ journals and Management Science would be considered like A journals.

These are the journals you would want your LOR writers publishing in.

 

An LOR from a known academic even if generic is not bad if your other LOR's are all from people in industry, but it likely will not help much.

 

Since you have the calc BC AP, you could probably go straight to calc III. You should take that as well as linear algebra, real analysis and preferably a calc based probability course and one serious stats or econometrics course. It would be best to take these courses as a non-matric at a local public college that is at least BA granting. Some adcoms frown at CC classes, so it is better to stick to BA granting schools (public just because it is cheaper than private and are usually more flexible with non-matrics). Online classes are OK if they are from a respected college and will provide you with a transcript, but in class is better. You mention you are working in finance. If you are in the NY metro area, also take a look at the Baruch Pre-MFE classes. You should also take a look at the Rice U online Econ PhD Math Camp which is usually offered from late May through early June, and again sometime in the fall, but if you have not taken a math class in years and lack calc III and lin alg the course would probably be too hard.

 

In your initial post you asked about your chances for top 15. If your goal is to be an academic researcher at a research university, you don't need to go to a top 15. In the Humanities and soft Social Sciences that is true, but in finance, even graduates from top 75 programs can get those jobs. Just to give an example I am a PhD student at a top 50ish program and they have graduated 20 students over the last 6 years. Two went to industry, the rest to academia. Of those who went to academia, 12 are in TT positions at research universities (6 Asia, 5 US, 1 Canada), so 12/18 who went to academia got TT positions at research institutions. One has a TT position at a top 25 LAC with research expectations and 3 more got Visiting AP positions at research universities, so 15/18 got full time jobs a research universities and 16/18 got full time positions with research expectations. [The last two got teaching positions but both entered the program at 40+ after years in industry and TT jobs are hard to get at that age.]

 

As far as Yas' suggestion of an MFE, if you are still absolutely set on a top 15 PhD program then an MFE at a program with a history of placing grads in top finance PhD programs would be useful but you would still need calc III, lin alg, calc based prob and some extra programing courses or experience in order to even be considered for admission at a top MFE programs. Many also require ODE's as a pre-req. Off the top of my head I know UC Berkeley's MFE, U Chicago's MSFM and Princeton's M.Fin have all placed students in top 15 finance PhD programs in the past. The MS in Financial Economics at Columbia Business School might be a good option, especially since you take many of your classes with the finance PhD students, but they specifically state that they expect incoming students to have comparable preparation the the minimum necessary for PhD students.

 

If you are not absolutely set on a top 15, don't bother with the MFE. It will add an extra 1-2 years and costs a lot (40-100k). Finance PhD programs do value students with good relevant industry experience, conditional on them having the minimum necessary mathematical preparation and a lot of top 50 programs will take a serious look at such an applicant.

 

Also like Yas suggests, see if you can attend some workshops or seminars at nearby universities to get an idea about academic research. It would also be a good idea to look at what is being published in the top 3 journals. If you don't have access, you can usually find working paper versions of those papers on the authors websites or on SSRN.

[TedMosby]

This is going to be a bit long.

 

...

 

Also like Yas suggests, see if you can attend some workshops or seminars at nearby universities to get an idea about academic research. It would also be a good idea to look at what is being published in the top 3 journals. If you don't have access, you can usually find working paper versions of those papers on the authors websites or on SSRN.

 

Thanks very much for the comprehensive reply!

[TedMosby]

This is going to be a bit long.

 

Since you have the calc BC AP, you could probably go straight to calc III. You should take that as well as linear algebra, real analysis and preferably a calc based probability course and one serious stats or econometrics course. It would be best to take these courses as a non-matric at a local public college that is at least BA granting. Some adcoms frown at CC classes, so it is better to stick to BA granting schools (public just because it is cheaper than private and are usually more flexible with non-matrics). Online classes are OK if they are from a respected college and will provide you with a transcript, but in class is better. You mention you are working in finance. If you are in the NY metro area, also take a look at the Baruch Pre-MFE classes. You should also take a look at the Rice U online Econ PhD Math Camp which is usually offered from late May through early June, and again sometime in the fall, but if you have not taken a math class in years and lack calc III and lin alg the course would probably be too hard.

 

As far as Yas' suggestion of an MFE, if you are still absolutely set on a top 15 PhD program then an MFE at a program with a history of placing grads in top finance PhD programs would be useful but you would still need calc III, lin alg, calc based prob and some extra programing courses or experience in order to even be considered for admission at a top MFE programs. Many also require ODE's as a pre-req. Off the top of my head I know UC Berkeley's MFE, U Chicago's MSFM and Princeton's M.Fin have all placed students in top 15 finance PhD programs in the past. The MS in Financial Economics at Columbia Business School might be a good option, especially since you take many of your classes with the finance PhD students, but they specifically state that they expect incoming students to have comparable preparation the the minimum necessary for PhD students.

 

 

Thanks again for your help! A couple follow up questions...

 

In terms of taking the math courses as a non-degree student - does the school matter, as long as its a BA-granting school? To take the NYC example - would courses from Baruch be viewed differently compared to courses at Columbia?

 

On the MFE path towards a top 15 - does getting good grades and developing a relationship with professors seem sufficient? Or do you think I would need to get them to take me on as a research assistant/associate?

[TedMosby]

In terms of taking math courses as a non-degree student - does it matter where I do that (assuming that the schools are all BA-granting)? E.g., to take the NYC example - would it be viewed differently if I took the courses at Baruch vs Columbia?

 

In terms of the MFE path toward a top 15 - do you have a sense for whether doing well in classes plus developing a relationship with professors is sufficient, or if a research associate/assistant gig would be needed?

[zshfryoh1]

In terms of taking math courses as a non-degree student - does it matter where I do that (assuming that the schools are all BA-granting)? E.g., to take the NYC example - would it be viewed differently if I took the courses at Baruch vs Columbia?

 

In terms of the MFE path toward a top 15 - do you have a sense for whether doing well in classes plus developing a relationship with professors is sufficient, or if a research associate/assistant gig would be needed?

 

 

For non-degree classes there would be a difference between a LAC or lower tier public college and a research oriented school whose name and quality/reputation would be familiar to adcoms, but beyond that there is little difference. So continuing on the NYC example, for your purposes, there would be no significant difference between Baruch and Columbia, but there might be between those two schools and say a small LAC like Marymount Manhattan or a public college that is widely considered to be lower quality like Medgar Evers.

 

Research experience always helps, but if you plan on doing the MFE full time, I don't know that you will have the time. The good MFE programs (Quantnet top 20) are pretty intense.

 

Keep in mind that you mentioned in your first post that you are already about 30 years old. While finance PhD programs (or more generally B-school PhD programs) are more willing than most other fields to take on "older" candidates, especially if they have useful relevant work experience, the top 15's are far less likely to accept such an applicant than a top 50. There are only about 110 finance PhD programs in the US matriculating

[TedMosby]

In terms of selling admissions committees on my work experience - does it matter if I am still employed at the time of application? Let's hypothetically assume that adcoms find it impressive and relevant (I realize that some may argue that adcoms will find it irrelevant, but for the sake of argument, let's assume that adcoms find it impressive/relevant please). I am considering if it makes more sense to (1) leave my current job and take non-degree classes full-time, or (2) continue working and take classes part time.

 

If I go with option 1, I think I could complete calc 3, linear algebra, a calc-based probability class, and real analysis before applications begin. I could also be enrolled in 2 more classes at the time of application (on that note, do admissions committees "count" classes you are enrolled in, but have not completed?). I would also have a decent amount of time to chat with professors, and one may potentially be willing to write a LOR.

 

If I go with option 2, I could only take a smaller courseload (at the time of application, I could be done with 2 courses and be enrolled in one more). However, I could say that I'm still employed at my current job - is there value in that? Or is work experience equally valuable regardless of whether or not it is current? In the industry environment, there tends to be a stigma against employment gaps (folks tend to assume you were forced out of your previous job, or burned out)... but not sure if that applies for PhD admissions? Thanks all for your help!