Hi All, Which fields in finance are the most suitable ones for people with engineering undergraduate degree? I also have MBA and I will pursue CFA as well… But I do not have any finance work experience. My accounting knowledge is not very strong, either. Thanks!
there are no undergrad degree that is a clear cut degree to say…okay you will be great at this… best trader I know was a history undergrad… what do you want to do? then firgue out a path to get there…
i think there are 50MM people in same situtation… heres the typical path undergrad engineer makes ~$50-75K year 1-2, realizes they study there a$$ off and do not use 90% of material learned. 3rd year makes ~$80K-100K goes gets MBA to bump salary into 6 figures… gets MBA, if returns to engineering field, trying for management role making $120K-$150K… unless becoming executive, tops out $200k at year 15-20 in workforce retires at 60, maybe earlier depending on how ESPP worked out for them… the only way to make it big is to 1) start your own firm 2) engineering consultant do ok ($300-400k) but travel is nonstop. ---------------------------- thanks but no thanks, i would feel like i am dead already, BTW I thought this was my doom when doing my engineering undergrad.
I will go into finance field. So, going back to engineering or consulting are not options for me. Thanks anyway…
Does anyone agree that Engineers are underpaid? Wouldn’t you agree that Engineers have a significantly greater positive impact on society than PMs or HFMs (the same could be said about doctors)? But are correctly compensated for it? While I do feel that HFs and the like do serve a positive purpose to society as they extract capital that is not being used efficiently and insert it into efficient uses (such as new homes, high end merchandise, or back into the capital markets); I still feel that technological innovation greatly overshadows all of this. Imagine if people like Einstein, Newton, Franklin, Edison, Watt and Crick had worked in Hedge Funds how much would we have lost? I think that it is imperative that economic forces shift so that the appropriate financial motivating factors are applied to technological innovation as much as they are to finding alpha.
“Does anyone agree that Engineers are underpaid?” No. It’s supply and demand, baby! There are ten hundred bagillion engineers out there that have the exact same skillset (most of them are one trick ponies, at that). It’s a commodity business that pays commodity salaries. If there are few slots and lots of people willing to fill them, employers will naturally pay less. What they “contribute” is largely irrelevant (and somewhat subjective, anyway). Personally, I’m happy to see a lot of arrogant engineering types hit the concrete a few years after graduating. “But, but, I majored in engineering, I’m so smart!!” Yeah, right. Engineering is the most overrated discipline ever. (If you’re wondering, I doubled in CSE and humanities.)
I looked very seriously at a number of engineering programs, but it was pretty obvious to me that to make it big I should do something in college besides take 4 years of math classes. MFE nailed it on the salary side as well. It looks great coming right out of school, but there’s little upside.
asdffdsa Wrote: ------------------------------------------------------- > Personally, I’m happy to see a lot of arrogant > engineering types hit the concrete a few years > after graduating. “But, but, I majored in > engineering, I’m so smart!!” Yeah, right. > Engineering is the most overrated discipline ever. > (If you’re wondering, I doubled in CSE and > humanities.) Well the downside of this to those of you who are less established in finance (Less than 5 years experience) is that these enigneers then turn around and do a MBA and/or CFA and try to get a job in finance. I can tell you that 90% of the time unless you went to a top school that a 4.0 finance major even with some experience will lose a job to a 3.5 engineering major with none. As financial careers become more quant driven the more firms look to hire someone with a proven quant skill set like computer programmers and engineers. I can tell you that out of a MM firm I know pretty well they hired 15 people from undergrad recruiting for ER and only 2 had business degrees one of which had done a PPA program (so he had a masters in accounting) and the other had done a 5-year MsF. The other 13 had some kind of math or science background.
I second RA on this one… quat is the future… actually…right now
I have somewhat the same background: (BS and MS in engineering), CFA Level III candidate, and applying to B-School. I can say that at my company (energy trading/marketing division of a large company) most analysts have an engineering undergrad and either an MBA or CFA (or both). The feeling within the group is to get people with strong quant skills since we are expected to do some modeling and programming (mostly VB). Although we do look strongly at quant skills, “fit” is just as important. We are looking for people who can also effectively communicate with our traders and marketers. However, I do feel as though many engineers are trying to make the move into a finance role. Many of my friends are unhappy with the compensation they’re getting in their engineering positions, and are looking to do something else. Naturally, finance is popular alternative. This means that the competition for top entry-level jobs will get even more fierce. Can’t you leverage your connections from b-school to try to break into an entry level finance role? You may have to take a pay decrease, but if you feel that it’s a good career move, then you might want to take an opportunity…
I work in finance and at the end of the day I find the engineering guys having a uphill battle. Best bet is going to good b school and using career office… At end of the day my work exp would be more marketable then someone with all the right cred…
what most undergrad engineers find is, that school prestige matters in the world of finance, and very rarely at all in the engineering discipline. Additionally, some top engineering schools are not top finance schools. Georgia Tech, Cal Tech, U Mich, Illinois are all excellent engineering schools, but are often overlooked in finance when banking recruitiers are looking for “prestige”. My best advice for a engineer (pre-MBA) that wants to break into finance is to go to a top MBA program.
mfe… you said it much better then me…
I can’t agree more with MFE. Dead on. Coming from one of the schools he mentioned, the companies that recruit here are mainly supply chain consulting firms, big industrial firms, and engineering contract firms. The only “non-tech” firm that recruited here was Bain, and that was for management consulting. Breaking into finance (entry level) is like uber-uphill without the right career office, and frankly engineering schools are just not equipped with finance connection. Work tail off, get top mba, network, and hopefully you can squeeze in during recruit season or have a classmate who makes VP sooner than everyone else to hook you up.
Thank you all for your replies. But, my question was: “In which fields of finance do people with engineering background have an advantage over people with only BA degree?” So far, I know that fixed income and risk management are more quant oriented… I do not expect much help from my career office, so I will look for a job by myself… Therefore, I am trying to find out in which areas of finance my background would be more valuable. Thanks
I dont think any have an advantage but middle office could be a good place for you.
MFE, coming from a top 20 undergraduate engineering program with dozens of friends of all ages in engineering, I don’t know of any significant number of engineers making 80-100k their 3rd year out of school. That is totally preposterous. I have all of one acquaintance from my school who started at Google and made 100k his first year. Only the extreme outliers are making 80-100k in engineering at age 25. One other thing–the area I live in is one of the engineering capitals of the planet and the idea that a middle manager in engineering is pulling in 200k is fallacious. Again, only outliers pull in that kind of money.
kkent Wrote: ------------------------------------------------------- > MFE, coming from a top 20 undergraduate > engineering program with dozens of friends of all > ages in engineering, I don’t know of any > significant number of engineers making 80-100k > their 3rd year out of school. That is totally > preposterous. I have all of one acquaintance > from my school who started at Google and made 100k > his first year. Only the extreme outliers are > making 80-100k in engineering at age 25. > > One other thing–the area I live in is one of the > engineering capitals of the planet and the idea > that a middle manager in engineering is pulling in > 200k is fallacious. Again, only outliers pull in > that kind of money. odd. When I graduated with a MFE '01, all the undergrads were getting offers of $60K Base. Bonus runs 5-7% typically. That is 2002. So are you saying 3rd year should make more? either way, not much more then $100k… also, middle managers are 5-10 years out of undergrad and Director Engineering at the 15-20 year level in career do make $200k. Where do you live, China? When I interned I pulled $30/hr my Jr-Sr year +overtime+paid holiday. 30*8*5*52 = $62,400 with no overtime, I was annually making probably $80k, but no benefits…
here you go… alma mater: http://www.engineering.cornell.edu/student-services/engineering-coop-career-services/statistics/upload/Electrical-Engr-BS-06.pdf
I would not disagree that engineering grads are averaging $60K out of school. However, I think the rate of increase is not as high as you suggest (at least, not on average). Even with a 7% bonus on $60K and 10% increases 2 years in a row (which is probably generous), the ending salary with bonus would only be ~$78K. I don’t think most 3rd year engineering grads (who are in engineering) are averaging $80 - 100K. At least, not the friends I had from undergrad, before they all migrated to Google.