I’m currently a CFA level III candidate and in my mid 30s. I have always wanted to study for a PHD in Finance ( don’t tell me you cant as I have made up my mind) and I need help in choosing a thesis topic –it’s a long time since I finished my Msc in Finance.
My interests are along Construction of a dividend growth portfolio. I’m fascinated with the research by Gardner (2008), Davis (2004), etc which indicates that dividend growth stocks are the best-performing class. In fact the impact of dividends has been extensively studied, with most empirical literature indicating that dividend paying portfolio outperform other classes. However my thesis is on the construction of such a portfolio – I want to cover areas like asset allocation, construction, risk measurement, and back testing; and actually testing a sample portfolio against indices. Can this fly??? Or is this too general. Any oher suggestions for topics along this area?
I thought you get into school first and then pick your topic?
If your thesis will be about how to gain a $1000k salary with a PharmaD degree, cleaning your colon, or how Trump will make America great again, then this is a great place to get ideas.
To apply for a PhD course you need a research proposal topic. thanks
People don’t need to commit to a thesis proposal when they apply, but they should have a few ideas of what they might work on. Often times people change their mind after doing some classwork and finding out that they are more interested in a different line of research or that their original ideas weren’t formulated in ways that make sense.
As for a dividend portfolio, I think the key issue would be on why dividends contains a signal that a similarly growing non-dividend payer doesn’t have, and whether the outperformance signals a kind of risk that most risk measurements aren’t capturing or whether it is a genuine alpha signal. If you can come up with some proposals for what risks might separate non-dividend payers from dividend-paying stock, that would be an interesting topic. Also you might approach it from the perspective of behavioral finance… perhaps all that happens is that people think dividend-paying stocks are lower risk than non-dividend payers with similar returns and it becomes a self fulfilling prophecy. Another angle might be whether taxability of dividends is creating the difference, so that the after tax performance of dividend payers and non-dividend payers is about equal. That would sugest that the before-tax performance of dividend payers would have to be higher because of less compounding driven by tax liabilities, thus suggesting that the dividend outperformance is only realizable in non-taxable accounts and/or entities.
I’d be a little surprised if these angles haven’t been investigated already, but as a candidate, you don’t necessarily have to know all of that right away.
I do have a serious question. What type of background is required to get a “PhD in Finance”? To get a PhD in physics, for instance, you would need top grades, recommendations, and demonstrated commitment coming out of college. Can random 30s people just apply to reputable “finance” PhD programs?
I did a PhD in finance. Some short feedback:
(1) Usually you do some course work before you start with your research, i.e. you have to pass prelims. This usually takes 2 years.
(2) It’s very unusual that you have to have to write a research proposal for your application, at least for top-tanked programs. If you want my advice: A PhD from a school which is ranked below Top 50 is not worth spending 5 years of your life on. Also your age might be a disadvantge on the academic job market which is right now very tough. Usually you place downwards, i.e. if you are from a top 50 school you apply to top 50-100 schools. Lots of people tight now end up without job offers.
(3) The idea you have for your research proposal is not really a research question but rather a about implementation and methodology. The crucial question is what contribution you can make to the existing literature. I would think about that again.
Thanks guys for your contribution. Sorry I didn’t clarify that I’m enrolling for the PhD programme with a UK University. I have moved back to the UK and here, one can do a PhD part-time even with a top-tanked schools. 2-4 years depending on your progress. With the majority of schools I have approved, you only need to spend a few weeks in class for intro work, thereafter you agree a timeline with your supervisor. However two of the most common conditions for acceptance is a 10 or so pages PhD thesis proposal and finding a supervisor at the school who likes the topic. Its kinda harsh to expect a thesis topic to be laid out before you enrol but I guess that is why their programmes are shorter and they expect that you are at MPhil level when you start.
Regarding the ranking, tenure etc…most these comments relate to US. In other countries like UK, EU, Australia, South Africa etc …there is not much emphasis on the school ranking.
Could you provide some examples of part-time PhD programs from top-ranked schools in the UK? Never seen this.
The academic job market is really tough. If you want to have an academic career it does not make any sense to do a 2-4 year part-time program. At the end of your PhD you are expected to have at least some interesting working papers with a potential contribution to the existing literature. This is not doable in 2-4 years part-time. That’s why the good Finance PhD programs are 5 years full time. And full time usually means 60h+ of work per week. Moreover, European universities put a lot of emphasys on school ranking, at least research schools.
If you are doing the PhD just for intellectual curiosity I think you will be fine. If you are doing it for an academic career I try to save you from disappointment. Regarding industry options: It might be a small plus if you have a PhD in Finance but probably you are better off if you put the time into your current job.
This part time Ph.D. thing seems a little dubious. My guess is that universities are responding to pressure to create something like an Executive MBA program so that industry people can upgrade their letters to include Ph.D…
A more traditional Ph.D. program is designed to create people capable of performing rigorous research based on deep knowledge of academic literature and an understanding of the methodological requirements for establishing credible arguments. The MA or MS or M.Phil that you get along the way tends to attest to knowledge of the literature, and the Ph.D. attests to the ability to conduct original research using sound methodological practices.
The way my advisor put it is “To get a Ph.D., you have to show that you have the knowledge to teach a good class and to write a good book (or articles).” Admittedly, “teach a good class” refers to the content of the course, not the method of delivery: the first few years of teaching are usually pretty brutal as professors figure out how to communicate the material the right way to students. It’s easy to forget what it’s like to know nothing, or to be basically smart, but not know anything. EDIT: Although teaching is a responsibility of professors, it doesn’t seem to be highly valued by universities in terms of promotion or tenure.
I can imagine a part time Ph.D. but I can’t imagine a short-length part time Ph.D. that would be taken seriously in academic circles. And the academic job market is really cuthroat right now. As Henry Kissenger said “The politics is so brutal because the stakes are so low.” Universities don’t want to grant Tenure. They’d much rather hire adjuncts for $2500 per course and no benefits.
A lot of people do Ph.D.s because they want to be called “doctor.” Perhaps companies also want to say they have Ph.D.s on their staff for marketing reasons. I guess there’s nothing wrong with that (other than dilution of the degree for everyone else), but just jump in with your eyes open.
my 2 cents - yes in Europe or UK you can get good part-time Phd programmes. My understanding is PhD is all about research and not being taught. My sister had a PhD from Warwick whilst working. see below.
Even London Business School the top 1 in Europe used to have part-time Finance PhD up until recently.
The first one says 5-6 years part time (minimum period); the third one 6 years; the second one 4 -7years. My point is: They will not be a good choice for an academic career.
Are you saying that because they take too long? Or aren’t in depth enough? Or are from crummy universities? Or just because people will assume part time means “not that good.”
I didn’t look. Does a Ph.D. from a part time program say part-time Ph.D. on it? Assuming you produce research, how will people know that it was part time? Most academic CVs do not include industry work on it except for a few footnotes, perhaps.
First, congrats for getting a program!
This “part time PhD” is totally normal in Europe and nobody gives a f*ck how you got it. I’d say part-time PhD + working, especially in an “application oriented” field such as FInance.
A little bit more awareness about different academic arrangements worldwide by our North American would be welcome. Not everything is a scam the doesn’t follow the US-model.
OP: I will PM you on your question, I am in a similar situation here
In my defense, what I did say was this: “I can imagine a part time Ph.D. but I can’t imagine a short-length part time Ph.D. that would be taken seriously in academic circles.”
I certainly think that it is possible to do a Ph.D. part time that gets respect. I just don’t think you can cut down the total work that goes into a Ph.D. and retain respect, and that means that part time Ph.D.s that get respect will need to take longer than full time Ph.D.s…
So while I didn’t know that part time Ph.D.s are common all over Europe (and it’s possible that in recent years they have become more so), I didn’t dismiss it out of hand.
I’ve always thought that traditional risk measurements (st dev, beta), and the corresponding risk-adjusted return metrics (sharpe, Sorontino) used to evaluate PM performance is interesting. I think the bifurcation between behavioural-trading driven volatility (i.e. nonfundamental risk assuming a moderate view on holding period) and fundamental underlying business performance would be an interesting area to delve into.
hi, guys, very useful advice, thx!
I spent several years in a PhD program more than 30 years ago. My biggest professional regret is not finishing the doctorate. But I self-destructed politically, and, by the time I realized that, it was too late.
There is huge variation among PhD programs, no matter what the subject. In your case, I would look at the background of finance-faculty members at top-tier schools on your continent and see where they got their doctorates. That will hugely reduce the number of institutions that you should consider.
Good for you. I moved from math to finance, twenty years ago, because it is filled with ambitious, smart and often optimistic and nice people who wanted to pursue interesting things. There are lots of vicious Gordon Gekko types but they don’t survive.
You should think about a Ph.D. as starting a small business. It is a portfolio of research papers where you will research, teach, and maybe invest/consult. A Ph.D. may not move you ahead in investing or consulting, because these careers begin much earlier. There is a need to develop presentation, social, and work skills to serve profitable clients - and contacts. However, there is no end of demand for research and teaching skills in the field. Although I was an ABD in operations research, I now hold a research position in a regulator and really enjoy it. As far as topics go: there are two schools of advice (1.) Where there is a gap in the academic literature; (2.) What people will pay you to write about and talk about. Go for it!
Besides what others have said, I think it’s also important to note that you should enroll in one of the very best PhD programs. If you’re wondering how to determine what those ‘very best PhD programs’ are, I recommend looking at the masthead of several of the top research journals in the finance field and noting the institutions where the members of the respective editorial review boards are employed. My doctoral field of study was strategic management, so I cannot say with certainty what the best finance journals are. However, based on the paper published here–http://www.ritsumei.ac.jp/~y-gokan/Ranking.pdf--the top five ‘A+’ journals in finance are, in descending order, (1) Econometrica; (2) Quarterly Journal of Economics; (3) Review of Economic Studies; (4) Journal of Political Economy; and (5) Journal of Finance.
One other thing: Being a great teacher is nice, but it’s also secondary. Publishing in top-tier journals is primary, and that’s why you should enroll in the doctoral program of the very best institution that accepts you as a doctoral student.
I hope these comments are constructive and helpful.