Doing an MBA - a trader's view

http://news.efinancialcareers.co.uk/newsandviews_item/newsItemId-30930 GUEST COMMENT: I can think of nothing more nauseating than doing an MBA During my banking career I perceived undertaking an MBA as marginally less desirable than running naked through Battersea Dogs Home with Pedigree Chum smeared on my gonads. An MBA seemed to entail a lot of tedious work surrounded by dreadfully dull pinheads that ultimately resulted in very little benefit for your career. There were two basic options – the two year part-time course that you pursued whilst still working and the full-time course that you had to take ten months off to complete. Just thinking about the part-time MBA used to make me break out in hives taking into account the hideous eleven hour days I was already being forced to endure whilst the full-time course seemed like a perfect opportunity to lose all your client contacts and get totally out of touch with the market. Neither of these two outcomes struck me as being especially beneficial. And what exactly would one gain to compensate for these risks? The MBA would not help me with my very specific role as an equity analyst as the courses were invariably general in content. It might have provided a half-decent networking opportunity but I always suspected I’d meet people more likely to further my career down at Spearmint Rhino. No, the only benefit it might provide would be if, for some sick and twisted reason, I decided to become part of my bank’s management team. But why on God’s clean earth would anyone with more than two brain cells to rub together ever contemplate such a move? You’d have to be smoking crack to even consider managing the Machiavellian, money-grabbing egotists that populate the average investment bank’s trading floor. All these buffoons ever do is clumsily kiss your bony arse whilst coating you off to each other behind your back. What’s worse is that their gargantuan egos mean that they never listen to your advice, which is why my former head of sales referred to his job as ‘herding cats’. Your utterances are routinely ignored and within weeks it becomes clear that you’re about as useful as a condom vending machine at the Vatican. Furthermore, every December you have to endure your workers’ feigned outrage as you hand them millions in bonuses despite the fact that you’re often not paid half as much as the feckless degenerates you’re managing. To add insult to injury, everyone knows administrative heads are universally regarded as failed brokers who couldn’t cut it on the trading floor. In fact, every banking manager has to accept he’s being dismissed by the treacherous, disloyal toads beneath him as a ‘cost-base’ and not a ‘revenue generator’ – surely, the worst insult for anyone at a bank. An MBA is just a gateway to a whole world of pain; I would not wish it on my worst enemy. Geraint Anderson is author of ‘Cityboy – Beer and Loathing in the Square Mile’

Thats a great story for the top 1%ers. What about the 90% plus of guys who get booted from trading by the time they are 40. Its pretty nice to have MBA, CFA credentials when you see unemployment in the business running above 25%. A whole lot of the guys that laughed at me for getting MBA and CFA are out of work. These credentials have without a doubt helped me stay in the business. But I hope more people take his advice.

NJLVLIII Wrote: ------------------------------------------------------- > Thats a great story for the top 1%ers. What about > the 90% plus of guys who get booted from trading > by the time they are 40. Its pretty nice to have > MBA, CFA credentials when you see unemployment in > the business running above 25%. > > A whole lot of the guys that laughed at me for > getting MBA and CFA are out of work. These > credentials have without a doubt helped me stay in > the business. > > But I hope more people take his advice. yea, i pay little attention to the naysayers like that

wtf does an mba do for trading? great - now i can model a capm or compare npv’s. so useful!!! mba’s are strickly for people who are unhappy with their careers or have maxed out at their current role and their firm is pushing them to get to the next level. i will never get a pt mba as the local options aren’t that great and it makes me think of a career-anonymous 12-step-help program. @ NJLVLIII - if you’ve been trading for a decade you should have quite an egg to sit on, no? there’s a ton of risk/advisory gigs out there for people who know the lingo. we have a ton of exes smattered around in other teams to provide their ‘historical’ views.

Sell side traders are a dime a dozen and most do not make more than 150-200k per yr. Of course at the bigger banks its more. I literally know about 50 people that were sell side traders for over 10 years that are out of work with no prospects because they have college degrees from average schools and thats it. How many sell side traders do you know that are still on the desk at 45? Can you retire at 45 if you have made 150-300k per yr in NYC? I doubt it. What do you do at 45? I have been out of work twice in the last 3 years because my shops have gone out. I got jobs relatively quickly because of my customer contacts along with my credientials. I went and got both MBA and CFA purely for defensive reasons. I am thrilled I did. Who knows if its right for you.

Er… so I am a trader on the sell side. The compensation cap is definitely higher than what you mentioned above, and I know many traders who are in their 40s or higher. But anyway, the author of this article is just in a profession that does not value MBA degrees. His opinion would probably be different for someone in a different situation, for instance, someone who just finished an IB analyst program who wants to earn 300k as an associate after getting an MBA.

Agreed the cap is a lot higher, I know a lot of guys that make well over 700k. But when you leave the top 1/2 of guys it gets lower fast. and at the second and third tier firms I have heard of bonuses in the 20-30k range for their 2nd tier traders.

But, you can say that for any field. The bottom half of equity research analysts probably make much less than the top half.

So maybe the article is right! Only dopes like me should get it as insurance!

this guy is a fu ckin retard he thinks he’s some sort of righteous hippy, but than gets a job as a sell-side analyst. The third son of Labour politician Donald Anderson, Baron Anderson of Swansea and his missionary wife Dorothy, herself the daughter of Bolivian missionaries, he was raised at his parents’ London home in Notting Hill. Anderson was educated at Fox School in Notting Hill and Latymer Upper School in Hammersmith.Taking a gap year in Asia, Anderson says he lived the hippy life and smoked dope. He then undertook a degree in history at Queens’ College, University of Cambridge, and then an MA in revolutions at Sussex University, before heading back to Goa to plan a trading based lifestyle in trinkets. Banking However, his parents were not pleased, and so his older brother Hugh who worked as fund manager with Dutch investment bank ABN Amro arranged an interview in 1996. Anderson was resultantly employed as a utilities analyst, composing models of publicly listed companies. Within five years, his salary had jumped from £24,000 to £120,000; his first three years of bonuses: £14,000; £55,000 and £140,000.[3] In 1997 he moved to Société Générale, and in 1999 to Commerzbank. In 2000 Anderson joined Dresdner Kleinwort. Named top stock-picker two years running, appointed joint team leader of the utilities research team, the team becomes number two in the utilities sector and Anderson is personally judged the fourth highest-ranked analyst (out of around 100).

I’m not really interested in SS trading, so MBA holds value for me (although I don’t have one), but I did really enjoy the article and agreed with the author’s points with regards to the MBA as it relates to SS trading, plus the author’s got a funny writing style. That being said, NJLVLIII also has a point, for someone who wants to have a broader background and more versatility rather than specialization MBA’s a great move. I’ve studied subjects I don’t currently use for the same reason. It’s always best to be prepared because in the event your niche evaporates or the industry gets another shock, by then it’s always too late to retool.

SuperiorReturn Wrote: ------------------------------------------------------- > this guy is a fu ckin retard > he thinks he’s some sort of righteous hippy, but > than gets a job as a sell-side analyst. > > > The third son of Labour politician Donald > Anderson, Baron Anderson of Swansea and his > missionary wife Dorothy, herself the daughter of > Bolivian missionaries, he was raised at his > parents’ London home in Notting Hill. Anderson was > educated at Fox School in Notting Hill and Latymer > Upper School in Hammersmith.Taking a gap year in > Asia, Anderson says he lived the hippy life and > smoked dope. He then undertook a degree in history > at Queens’ College, University of Cambridge, and > then an MA in revolutions at Sussex University, > before heading back to Goa to plan a trading based > lifestyle in trinkets. > > Banking > However, his parents were not pleased, and so his > older brother Hugh who worked as fund manager with > Dutch investment bank ABN Amro arranged an > interview in 1996. Anderson was resultantly > employed as a utilities analyst, composing models > of publicly listed companies. Within five years, > his salary had jumped from £24,000 to £120,000; > his first three years of bonuses: £14,000; £55,000 > and £140,000.[3] In 1997 he moved to Société > Générale, and in 1999 to Commerzbank. > > In 2000 Anderson joined Dresdner Kleinwort. Named > top stock-picker two years running, appointed > joint team leader of the utilities research team, > the team becomes number two in the utilities > sector and Anderson is personally judged the > fourth highest-ranked analyst (out of around 100). Ha! Good info. He has made a name writing maverick style from the sidelines. I certainly knew he was lucky to get in at the right place at the right time and is certainly full of himself. Didn’t know how much he also relied on nepotism. Just shows it is easier to do it off someone else’s bat. What else would you expect from someone called Geraint!? At least he can’t have had it easy with a name like that - karma. Degree in history! MA in revolutions!! What a w.nk.r. And here we are, studying the CFA. Mind you I know someone who was an analyst with a degree in Mediaeval History. And a trader with BA Art History. Common denominator. Posh schools, posh daddies. Pile of utter w.nk That said, he does make a few decent points and it does provide light entertainment.

Hey, not everyone who goes to Harvard is riding on their parents’ tail coats. (Though, it is true that richer people tend to do better in high school and hence, are more likely to attend better colleges).

bleh

NJLVLIII Wrote: ------------------------------------------------------- > Sell side traders are a dime a dozen and most do > not make more than 150-200k per yr. Of course at > the bigger banks its more. Median is definitely higher than 175k. > I have been out of work twice in the last 3 years > because my shops have gone out. I got jobs > relatively quickly because of my customer contacts > along with my credientials. > > I went and got both MBA and CFA purely for > defensive reasons. I am thrilled I did. Who > knows if its right for you. I’m glad it’s helped you, but you are missing the point. Of course value(MBA) > 0. The question is whether value(MBA) > net costs, including opportunity cost. For any moderately senior trader, value(MBA) << net costs.

> The question is whether value(MBA) > net costs, > including opportunity cost. For any moderately > senior trader, value(MBA) << net costs. it really depends. one of our guys is doing a top-15 mba as an e-mba. i don’t think he really cares about the grade, but is obviously doing the work and going to pass. its basically whether or not you want to put the time in.

Hi, I hold Bsc (finance) degree and Msc (financial planning) degree plus I have 3years work experience at a commercial bank as a finance officer. I come from Africa. I got married last year and I am new to this place San Francisco. I am still looking for a job.Now a days banks have stopped sponsoring H1B visa.Currently I am on H4spouse visa and I am allowed to study further on this visa. So I am not sure what to study!!! Should I study CFA or get another master degree? I have an Australian degree plus 3years work experience and I do not know why I should get another master degree. I am already qualified. I just need a job. But since I am in US, I will need to study either CFA or Masters to get a job over here. So which one is more beneficial? CFA or masters? Can anyone guide me? which one is better to study?

mar350 Wrote: ------------------------------------------------------- > it really depends. one of our guys is doing a > top-15 mba as an e-mba. i don’t think he really > cares about the grade, but is obviously doing the > work and going to pass. its basically whether or > not you want to put the time in. (as an aside, i would look at an emba as a negative in a potential trader.) is he already an employed trader? does the top15 school help his pedigree? what’s the opportunity cost to his time? (it’s not 0.)

justin88 Wrote: ------------------------------------------------------- > (as an aside, i would look at an emba as a > negative in a potential trader.) you can’t tell if its an emba from the name, but that could be brought up in discussion > is he already an employed trader? he did trading a while ago and is now high up in our risk group > does the top15 school help his pedigree? i think so, he doesn’t have any other letters behind his name, but has solid indusrty exp. he stopped pursuing the cfa after failing l2 three times. > what’s the opportunity cost to his time? (it’s > not 0.) its def a time committment. he has a young child and spends time writing homework and studying for exams. he makes enough where the cost isn’t really important.

mar350 Wrote: ------------------------------------------------------- > justin88 Wrote: > -------------------------------------------------- > ----- > > (as an aside, i would look at an emba as a > > negative in a potential trader.) > > you can’t tell if its an emba from the name, but > that could be brought up in discussion a background check will catch labeling an emba as an mba. > > is he already an employed trader? > > he did trading a while ago and is now high up in > our risk group we’re talking about traders… but this seems reasonable for someone in risk.