Does This Frustrate Anyone?

I've met Religion majors in FIG, History majors in DCM, and yes, Art History majors in M&A. In part it reflects the makeup of the top leadership, who are old guard, as well the fact that being an investment banking MD does not require extraordinary quantitative talent or skill.

Def frustrates me. That's why BB training for new analysts is like 4-6 weeks long. However, I do understand why it happens - the older crowd would basically be admitting that their liberal arts degrees were pretty useless if they exclusively starting hiring finance/acct majors. Ibankers can't cope with that kind of shame.

I know quite a few traders and IB Analysts that are English and Philosophy majors, during their training they had almost absolutely no clue to what dcf, var ...etc. Certainly it is frustrated, but BB these days only want to recruit from places where they had previous success in recruiting decent candidates(on recruiters stand point: if recruiter has 2 to choose, one from Ivy and the other non-target, both similar experiences/grades, recruiters will choose ivy, because if this newly hired employee screws up, least recruiter can say "well he's ivy", but if non target screws up, their their boss will say "why the F... did you hire a non target?", thus Ivys are usually the main targets. I myself recently graduate from non target, I know how you feel.

That_Aston, your narrow view about the relationship between academic studies and real work is precisely what investment banks don't want to cultivate. There is already a huge over-supply of finace/econ/accounting graduates in banks and people from liberal arts/legal/physical science backgrounds can easily distinguish themselves from the herd who have all been tought the same things. The perception is that good legal or arts graduates are tought to think for themselves instead of all following the latest business school fads. At one of the large banks I worked, the Head of M&A was a lawyer, so was the Head of Equity Derivatives (+all his sales people) and Specialised Finance was led by an engineer. There were psychologists, docters and even historians in executive positions. The technical side of most IB products isn't rocket science and any graduate can learn a discipline in a year of work. I'd rather employ someone with creativity and leadership skills who is willing to learn than someone average who is unaware of his functional incompetence because he believes his studies tought him everything important...

90% of people in my group didn't go finance. But most did economics and something. Actually, my MD discriminatse against people who do, do finance... he argues that they're uncultivated and probably just there for the money and will be off as soon as someone offers more.

Philosophy and Politics majors, I find, are often the most capable. They're usually not into hearing absolute bs, and usually finance majors are frat kids who never worked a day in their life.

It's true... finance majors are the least hard-working in university -> the least hard working in rl.

At the end of the day the work that you do in finance is not very difficult and can be easily taught in a matter of a couple of months. Finance is inherently a sales job. Banks want to find people that can 1) do the relatively simple work, 2) have pedigree so that they can sell that to clients, and 3) are personable and can sell (this is less applicable at the jr. levels).

If banks really cared about hiring the most intelligent people then hey they would hire the top few guys at most schools (in all reality a top ranked guy at Texas A&M or whatever random non-target is likely brighter than a middle of the road Ivy grad that finished in the top 40% of his class)...but they don't care. They want to be able to show their clients that almost all of their grads went to HYPW, etc.

Just look at the senior people at most banks...most aren't the ridiculously brilliant Asian guy that rocked the analyst work. They have the target school pedigree (which usually means they met the minimum bar of intelligence to do the work) and are social, personable, sales guys that were former athletes, frat boys etc. in college. These guys met the minimum bar of intelligence at the jr. levels to do the relatively simple work but their EQ is what has allowed them to climb the ranks and do the job of a sr. person which is sales.

People make banking out to be something super glamorous but in all reality bankers are nothing more than glorified salesmen - they're just helping to sell companies, equity, debt, etc. as opposed to homes, mortgages, etc. Since I work in corpdev this has become more apparent to me than ever. It's sad these bankers just come and pitch us shit like a salesman coming to your door to sell you a magazine subscription.

Funnily enough I see many more people with a relevant background (finance/econ/quantitative degrees) then 'random' degrees get into IBD (can't speak for all of IB though and Im talking about the UK only).

I think it's a little silly to expect an apple out of an orange but I'm no recruiter! At least these days you can actually ask your collegue about midieval english folklore on your break. Geeez

It's simple - learning finance should be viewed as a tool in your professional arsenal. However, it's all about practical application of other fields (physics, engineering, computer science, cognitive psychology etc..). I have a finance major - yet it really shocks me how people who have studied finance at university are boxed into thinking only in relation to what they've learned. It's all about looking at the world - other fields and applying it to the financial realm.

So no - it does not bother me. 95% of the world does not understand the meaning of applied science. FYI - quick example.... QE3, constantly being reported that it will take a much larger package than previous initatives to make an impact on the economy. This has been based on research on the impact of the previous QE packages. Well, now take a non-finance related field... Physics... simple concept (kinetic energy). In order for an object to continue at terminal velocity as the item travels further in distance - it requires exponential more energy to sustain that speed per unit of travel (distance). In reality - it's quadratic. So.... apply this to the concept of QE and it's pretty clear that you will need significantly more $ (exponentially) to create a the same level of impact.

All that matters is raw intelligence an English major from Harvard is likely to be brighter than a finance major from UConn. It's easy enough to learn modeling and finance, anyone who is interested can go buy books on financial accounting, corporate finance and statement analysis and in a week understand what underpins most of investment banking.

This is a debate I'm not jumping into, but I got to say it is always hilarious watching the non-finance majors failing the pre-job training week tests on accounting / finance.

They think so highly of themselves having studied literature or something way out there, and then not even able to grasp simple finance concepts on a spoon-fed test.

I think some finance concepts take time sinking in... Agreed the basic stuff is not too hard but some people can have 'literature' minds and be unable to understand finance concepts. I have seen it happen. Not everyone is good at everything... even if you are from Harvard.

The tests that your direct managers will see before you even begin working. The tests where your managers will say "wtf is wrong with this moron that can't even pass a stupid intro to finance/accounting test?"

If you want to walk into the job with that first impression, be my guest

I think most majors fall somewhere in one of 3 categories:

1) Something relevant, giving you the foundational knowledge to go deeper in your field early on 2) Something difficult, training you to mentally tackle anything that is thrown at you 3) Something "persuasive", cultivating your ability to be a BS artist

All have their pros and cons. Ideal is to do all 3 in some fashion, get the best of all worlds...

Because finance isn't particularly difficult. It's more important to find people who are generally intelligent, personable, and hard working...hello target schools. They're a pretty solid filter for people who have those two of those traits (smart and hard working), so you just need to do a little more filtering within them. And it's much more efficient to just scoop Harvard grads than selecting people from schools everywhere.

Wait, is Politics/Literature/English considered harder than Finance?

A lot of it needs to do with sales and the reputation of an IVY league name for sure.

Having said that, the top economics and finance students from non targets are definately comparable if not more-qualified to step right in and deliver when compared to an IVY league middle of his class graudate.

For example (I realize this is only one example, but it is a relevant one), I interned at a reputable investment management firm 2 summers ago where I remember sitting in on meetings with our chief economist and market strategists. After one of these meetings, I attempted to have a discussion with a Yale intern I sat next to, and he did not have any opinions whatsoever to add to the conversation. He even had a few questions for me regarding basic topics that were discussed at the meetings... He clearly landed the internship based on his Yale credentials. Adding insult to injury, this was an Economics major.

People put way too much emphasis on majors. It ultimately neither represents your skills nor your interests.

Something that's more often then not decided based off of whatever you happen to scribble down in a drunken stupor the night before the deadline really should not be a deciding factor.

Not surprised about the diverse majors in finance considering one of top skills required is the ability to communicate orally and on paper. Liberal arts majors are used reading shit over with a fine comb, and writing papers where they have to effectively hammer in their thesis with strong arguments and BS.

If everything you need to learn can be gained in a few months and then you put on a salesman hat, finance doesn't seem like a very interesting job. Then again I guess most jobs aren't very interesting.

Simple answer. Recruiters know you're dumb because you spent 4 year studying material that will be covered in 6 weeks or less before you actually provide added value.

Most importantly, your observation is a result of target schools not actually having a finance major. There are 1 or 2 Ivies will a finance major.

@futuredoc

Reading pages of esoteric language and synthesizing it into an argument with good referencing is a hell of a lot harder for me (and more time consuming) than solving algebra problems from a undergrad "applied financial theory" textbook. But one thing I can say- a finance textbook is the same anywhere (assuming the instructor doesn't deviate from it too much)- but a humanities class can have wide range of difficulty depending on where you take it.

I think the truth is a well designed major should be rigorous and analytically oriented in nature. A good finance course goes beyond the simple formulas and focuses more on concepts rather than just formulas. Being a STEM major and having take both business and English classes I think that they are substantially easier.

And yet you failed at synthesizing, and adequately responding to, my argument (which was written in extremely basic straightforward language). I said humanities classes differ in difficulty depending on where you take them. (And to be more more clear- lets compare intro classes to intro classes, and so on)