So in school I majored in poli-sci but taught myself finance/accounting/investing by going to the library and reading books.
When I graduated from college (about a year ago) my ultimate goal was to land a job at a hedge fund. But it was pretty tough because hedge fund jobs are hard to land right out of school. Academically I was unimpressive, and I went to a state school.
Along the way (starting when I was a jr in college) I ran an investment blog where I posted ideas and commentary. I really pushed to put up original content and try to build myself into a brand for my niche in investing. This worked out well - After about a year of doing it I managed to get posts linked to by the NYT Dealbook, WSJ and FT blogs.
The blog helped in two ways. I was able to make a lot of contacts with people who were already in the field, and then with those contacts I was able to come to them for advice. So I would send then investment write ups I was working on to get their take on how to improve my process and make my process more professional. In turn, they shared a lot of professional resources with me. The other way is that it just helped get my name out there, people would use google, find my posts, and e-mail me. I tried to be really approachable to my readers, I was always willing to chat with them on the phone.
Once I got my investment process down, I applied to two investment clubs that are pretty tough to get into -- it is entirely based on an investment idea you submit in your application. I got into both which was really helpful in conveying my investment analysis skills.
Then, I took an unpaid internship with a small fund manager in my home town (I live in the south) who I admired. I got a meeting with him by sending a package to his house with a couple of investment ideas and a letter which described why I wanted to work for him. This was a pretty hands off internship, but it helped again in allowing me to get the criticism I needed to improve. He would assign me a company/industry to look at and in 2 weeks we would meet up and discuss my work for a few hours. I did this for 6 months.
Eventually, I started getting e-mails from people wanting to interview me for jobs. I don't know what quite happened, but something clicked. I never advertised that I was looking for a job, but on my blog I did say that I recently graduated from my university.
In the summer, a portfolio manager at a fund that I never dreamed of being able to work for (most of their employees come straight from Ivy League schools with plenty of work experience, the firm's founder is pretty legendary and widely read) reached out to me to talk. I thought it was just a networking call, but at the end of our conversation he made the offer to fly me out for interviews.
I flew out twice and managed to do well in both rounds. So now I am here in a place that gets a lot of snow, working for a fund that I absolutely love.
When I look back on it I think the keys were really figuring out a way to stand out from the crowd (my blog) and then reaching out to professionals in the field to help bridge the gap from what I learned by reading books and what they learned from their jobs. I had a lot of luck in meeting good helpful people that were much more intelligent than me.
I'm pursuing this strategy, except on the financial engineering side.
I started taking upper level coursework at a quant finance program and after a semester quickly realized a few things:
1. learning the material thoroughly wasn't inline with getting an A. And if you don't have the grades, employers won't care about what you know, making your degree useless.
2. the real value of the degree (and what you're paying for) is the credentialing. Not the knowledge or skillset, at least for me. There is no magic or 'secret sauce' that was being transfered from professor to student. Everything could be learned from the textbooks, scientific papers, and doing your own research. An MFE degree is basically a degree in linear algebra and stochastic calculus, sprinkled with financial applications.
3. Another aspect of the futility of an MFE degree is most employers don't care what degree it is, as long as its an advance degree in a hard science discipline. In fact, some firms respect an MS/PhD in CS, math, or statistics over MFE's. That says to me that all these advance degrees are merely tools to signal that you can work in a highly quantitative environment.
4. There are a few professors in the MFE program I admired, and I found that they were more than willing to speak with me, even if I was no longer a student. Once I demonstrated enough knowledge, interest, and skill, they were more than willing to open up, and talk to me about my goals, plans, and ideas. A few of the even admitted that some of what they teach had no practical applications in the real world, but must be taught in order to confer the degree.
So with a 4.0GPA, I stop taking classes, and started educating myself independently. I have a nice rapport with a few of the professors I admire (some are very accomplished, academically and professionally), and I've also made a few contacts with professional quants online.
So what I have found is, figure out what is important, and try get very good at that. In investments/quant finance, its building an edge. Many people (including me at one point) think the goal is having a 4.0GPA from a top flight school. I'm sure that helps you get in the game, but thats not what keeps you there.
Its much like VC in a way, if your startup is spitting out money, you won't have trouble attracting investments. And if it isn't, you'll have to convince them with your hoop jumping, educational background, degrees, prior success in different ventures, etc etc.
So your choice is to get profitable ASAP, or to play the game of building hype to garner VC attention. This is exactly how I view building real alpha-generating skills vs. getting an MFE degree.
The other thing thats helped is reaching out to practitioners and academics. It isn't as hard as I once thought, with the caveat that you bring something to the table. For me, I was able to demonstrate I had outpaced the students my professors were teaching. I even recommended a textbook that they became impressed with, and have incorporated it into their program.
If your goal is to be where MBA's are when they graduate, figure out what industry you want to be in, and try to get very skilled in that. If its investments, jakarta's post is really helpful. If its business, nothing says you know business like running one successfully. I definitely think the street vendors in NYC know more about business than my consulting/banking/PE friends.
Realize most of these degrees are signaling. They are a pretty lazy way for firms to do their due diligence when hiring. Of course, there are investment firms that hire specific signal processing and speech recognition experts to do things very specific with their academic backgrounds, but those are the minority. Most just want 'smart' people to 'figure things out'.
This is a very inspiring story. Thanks for sharing.
Would you mind writing a blog post explaining how you got started? You mentioned you went to the library and read books. Which books? Which ones did you start with? What knowledge did you have going in and what are some of the basics that you had to learn and then where did you go from there?
I do value investing, to learn that you really have to read a combination of theoretical (books about value investing) and practical (accounting, finance, investment valuation, excel modeling, books about different industries).
After that you need to put the two together and start valuing businesses. If you keep at it eventually you will pick up the right skills. Most people just read about the theory and dont focus enough on the practical stuff. Their analyses tend to be sub-par and unprofessional.
I spent a lot of time reverse engineering old investments by famous people or recent investments by hedge funds.
There was never one book that helped. I read a ton and tried to pick the best ideas from all of them. At school I regularly had about 10-12 books checked out in my name and would jump around, reading what really interested me.
The other day the founder of our fund took me out to lunch, he mentioned that he thinks Keynes offers the best introduction to the theory aspect of investing in Chapter 12 of his book General Theory of Employment Interest and Money. You can read about it here:
So in school I majored in poli-sci but taught myself finance/accounting/investing by going to the library and reading books.
When I graduated from college (about a year ago) my ultimate goal was to land a job at a hedge fund. But it was pretty tough because hedge fund jobs are hard to land right out of school. Academically I was unimpressive, and I went to a state school.
Along the way (starting when I was a jr in college) I ran an investment blog where I posted ideas and commentary. I really pushed to put up original content and try to build myself into a brand for my niche in investing. This worked out well - After about a year of doing it I managed to get posts linked to by the NYT Dealbook, WSJ and FT blogs.
The blog helped in two ways. I was able to make a lot of contacts with people who were already in the field, and then with those contacts I was able to come to them for advice. So I would send then investment write ups I was working on to get their take on how to improve my process and make my process more professional. In turn, they shared a lot of professional resources with me. The other way is that it just helped get my name out there, people would use google, find my posts, and e-mail me. I tried to be really approachable to my readers, I was always willing to chat with them on the phone.
Once I got my investment process down, I applied to two investment clubs that are pretty tough to get into -- it is entirely based on an investment idea you submit in your application. I got into both which was really helpful in conveying my investment analysis skills.
Then, I took an unpaid internship with a small fund manager in my home town (I live in the south) who I admired. I got a meeting with him by sending a package to his house with a couple of investment ideas and a letter which described why I wanted to work for him. This was a pretty hands off internship, but it helped again in allowing me to get the criticism I needed to improve. He would assign me a company/industry to look at and in 2 weeks we would meet up and discuss my work for a few hours. I did this for 6 months.
Eventually, I started getting e-mails from people wanting to interview me for jobs. I don't know what quite happened, but something clicked. I never advertised that I was looking for a job, but on my blog I did say that I recently graduated from my university.
In the summer, a portfolio manager at a fund that I never dreamed of being able to work for (most of their employees come straight from Ivy League schools with plenty of work experience, the firm's founder is pretty legendary and widely read) reached out to me to talk. I thought it was just a networking call, but at the end of our conversation he made the offer to fly me out for interviews.
I flew out twice and managed to do well in both rounds. So now I am here in a place that gets a lot of snow, working for a fund that I absolutely love.
When I look back on it I think the keys were really figuring out a way to stand out from the crowd (my blog) and then reaching out to professionals in the field to help bridge the gap from what I learned by reading books and what they learned from their jobs. I had a lot of luck in meeting good helpful people that were much more intelligent than me.