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How should I Acquire Knowledge
 

cauchymonkey's picture
(Baboon, 136
 
Points)
 on 7/19/12 at 5:07am
acquire knowledge.jpg

Hi WSO,

I am a math major at a target school, rising Junior. For the first two years took mostly pure math, some CS, and humanities classes. Took a little econ as well.

I've managed to get a 3.96 gpa, which I can make stable since I've already taken most of the hard classes I need (basically I could take mostly easy classes if I needed to guarantee a high gpa).

Due to various reasons, I am now prepared to give up the "life of the mind," so to speak. I want to get into finance but don't want to do investment banking (the 100+ hour weeks of mindless work that I keep reading about would be too much for me). I also do not want to become a specialized quant who just crunches numbers.

Reading about hedge funds, it seems like one has more room to use his brain at work (correct me if I'm wrong).

However, I have extremely little knowledge of finance. I've done some personal investing but honestly my decisions were based on weak logic and gut feeling. I have read some of Benjamin Graham's The Intelligent Investor. I had fun investing and making some lucky profits but it was based on nothing rigorous.

Since my decision to pursue this path is a recent one, I have no finance internships or clubs involvement to speak of. Basically I know what stocks, bonds, and mortgages are and obviously I can do math.

Therefore, I feel like to demonstrate interest, I should learn as much useful information as possible. I am prepared to work really fucking hard and learn all the stuff I need to.

I'm posting on this forum because I'm not sure what sources of info to read, what books to read, and how I should better understand the market. I don't want to waste my time learning bullshit. For example, I'm sure that taking several more econ classes where all we do is draw graphs and take derivatives would count as useless for finance.

Should I read the Wall Street Journal every day? Go back to personal investing? Study more financial math?

Thank you all in advance.

TLDR: College student with no finance background wondering what things to read and what knowledge is worth acquiring for the industry or useful to have for interviews.

Tags:
notamonkey's picture

http://www.sec.gov/edgar/sear

HF
 
Points)
 on 7/17/12 at 7:15pm

http://www.sec.gov/edgar/searchedgar/companysearch...

^^read until you either get it or quit due to boredom

All I care about in life is accumulating bananas

notamonkey's picture

also, google: seth klarman

HF
 
Points)
 on 7/17/12 at 7:17pm

also, google: seth klarman margin of safety pdf

All I care about in life is accumulating bananas

Cruncharoo's picture

with a 3.96 math gpa from a

CO
(Gorilla, 685
 
Points)
 on 7/17/12 at 8:21pm

with a 3.96 math gpa from a target school you should just walk into interviews with your pants unzipped and ready to go. don't worry about learning anything about finance cause it won't matter, you'll get where you wanna go

This to all my hatin' folks seeing me getting guac right now..

BTbanker's picture

If you want to work at a HF,

IB
 
Points)
 on 7/17/12 at 8:37pm

If you want to work at a HF, IB orand AM are prerequisites. I also agree with the importance of knowing how to read SEC filings.

"A man generally has two reasons for doing anything. One that sounds good, and the real one." - J.P. Morgan

Kassad's picture

Cruncharoo: with a 3.96 math

IB
(King Kong, 1,191
 
Points)
 on 7/17/12 at 9:15pm
Cruncharoo:

with a 3.96 math gpa from a target school you should just walk into interviews with your pants unzipped and ready to go. don't worry about learning anything about finance cause it won't matter, you'll get where you wanna go

Wow. OP, this pretty much sums up everything useful anyone could tell you right now.

Just make a good resume and apply to a ton of internships for next summer. Go to www.mergersandinquisitions.com for advice on resumes. Aside from that, Cruncharoo nailed... everything.

nontarget kid's picture

FSC: Cruncharoo: with a

ST
 
Points)
 on 7/17/12 at 10:10pm
FSC:
Cruncharoo:

with a 3.96 math gpa from a target school you should just walk into interviews with your pants unzipped and ready to go. don't worry about learning anything about finance cause it won't matter, you'll get where you wanna go

Wow. OP, this pretty much sums up everything useful anyone could tell you right now.

Just make a good resume and apply to a ton of internships for next summer. Go to www.mergersandinquisitions.com for advice on resumes. Aside from that, Cruncharoo nailed... everything.

I'm a finance and math double major at a non target with a 3.97 GPA, have solid finance-related extracurricular activities, and am working at a large AM firm this summer in derivative risk management. I will probably get no interviews when I apply to BB's for sales & trading SA positions for next summer. Take advantage of your pedigree, OP. From my limited experiences, it is the most important item on your resume.

kidflash's picture

Jesus christ. 3.96 in math?

IB
(Gorilla, 668
 
Points)
 on 7/17/12 at 11:44pm

Jesus christ. 3.96 in math?

mwgr5's picture

Buffett shareholder letters

HF
(Orangutan, 299
 
Points)
 on 7/18/12 at 12:13am

Buffett shareholder letters are a good place to start too:
http://www.berkshirehathaway.com/letters/letters.html

SirTradesaLot's picture

cauchymonkey: I'm posting on

 
Points)
 on 7/18/12 at 12:53am
cauchymonkey:

I'm posting on this forum because I'm not sure what sources of info to read, what books to read, and how I should better understand the market. I don't want to waste my time learning bullshit. For example, I'm sure that taking several more econ classes where all we do is draw graphs and take derivatives would count as useless for finance.

Should I read the Wall Street Journal every day? Go back to personal investing? Study more financial math?

Given your background, you should have an easy time getting a wide range of jobs. I would guess that most places will push you towards doing something quantitative. You mentioned you don't want to be a 'specialized quant who just crunches numbers,' but I expect many will guide you that way. I'm biased, but I don't think taking a derivatives course would be useless for finance...many people make their careers in that field.

Books:

Pioneering Portfolio Management, by David Swensen: David manages the Yale endowment and he discusses how he allocates capital to various asset classes and why. This is a good place to start because it will let you see how your clients think about various investment types (equities, fixed income, private equity, absolute return, real assets) and allow you to explore investment areas further that interest you.

Fooled by randomness, by Nicholas Nassim Taleb. Critiques all models that use normal distributions and essentially talks about how much riskier the market is than most people think.

The (mis)Behavior of markets, by Benoit Mandlebrot...same vein as above

Any book by Tversky and Kahneman...all related to psychology and inherent biases that people have and the logical inconsistencies made by people based upon how questions are framed. Very interesting and can be applied in many creative ways in finance.

When Genius Failed: the story about the collapse of Long-Term Capital Management, don't fall in love with your models.

I'm sure others could give you good books on valuation, but I'm not too into that, so I don't have anything there for you.

Turbo leverage for capital explosion -- BD Capital

My WSO Blog

cauchymonkey's picture

Hey everyone, Thanks for all

(Baboon, 136
 
Points)
 on 7/18/12 at 4:17am

Hey everyone,

Thanks for all the suggestions so far! Keep them coming.

I'm going to start reading all the books some of you mentioned. Do you recommend I start trading for the learning experience? I made an account on Investopedia and am thinking about doing some paper trading.

@SirPoopsaLot

Haha when I said "derivatives" I meant it in the context of "the derivative of x^2 is 2x." In econ classes you have to do a lot of pointless calculations like that. Of course financial derivatives clearly have great importance. Sorry for being unclear!

capitalizeddisinterest's picture

math talent going into

(Monkey, 55
 
Points)
 on 7/19/12 at 4:53am

math talent going into finance. so sad bro

Bulgepapa's picture

For trading try

O
 
Points)
 on 7/19/12 at 5:28am

For trading try howthemarketworks.com and wallstreetsurvivor.com for options trading as well,
those 2 websites are good for trading

dwight schrute's picture

Analysis of financial

(Gorilla, 673
 
Points)
 on 7/19/12 at 6:19am

Analysis of financial statements is a top notch introductory book to financial statements. But seriously beyond that and some technical skills, (excel, SAS/R if you go that route) most employers aren't going to expect you to be the most financially literate individual as a rising junior.

For now polish your resume and interview presence, research and network with firms you're interested in, and stay abreast of the markets. Since you don't want to do IBD you're best bet is to land an internship/SA at a well respected AM firm or HF. Soak up as much knowledge as you can and grow your network. If they like you enough they will find a spot for you somewhere.

Making money is art and working is art and good business is the best art - Andy Warhol

Kenny_Powers_CFA's picture

It is by the juice of sappho

HF
(Neanderthal, 2,193
 
Points)
 on 7/19/12 at 6:19am

It is by the juice of sappho that thoughts acquire speed
http://youtu.be/EMBb_tPPA8E?t=25s

There have been many great comebacks throughout history. Jesus was dead but then came back as an all-powerful God-Zombie.

Onetwobit's picture

Let's just say I wish that I

CF
(Orangutan, 252
 
Points)
 on 7/19/12 at 8:40am

Let's just say I wish that I were you (in a couple of ways at least).

I would probably focus on becoming proficient with excel (assuming you haven't taught yourself), prep an amazing resume to gain solid internships, and prep to be an interview stud.

Not really sure that learning hardcore financial theory is going to help you much...focus on getting placed into a solid environment first. Reading WSJ and being up to date with relevant information (90% of shit in WSJ isn't truly relevant though) and terminology is a solid place to start imo.

When you are placed in an internship (especially your first), you will not be assumed as some finance genius with a brilliant understanding of the market/industry/process. You just want to be the intern that learns fast and attains information with limited explanation, is likable (holds solid conversations and doesn't appear to be socially retarded), and is non annoying. This isn't to say you shouldn't attempt to learn concepts and processes outside of work...just try not to get ahead of yourself.

blastoise's picture

bad thread, dosen't deserve

O
 
Points)
 on 7/19/12 at 9:10am
FutureWaller's picture

READ THIS WEBSITE

O
 
Points)
 on 7/19/12 at 9:21am
blastoise's picture

FutureWaller: READ THIS

O
 
Points)
 on 7/19/12 at 9:51am
virtu333's picture

Damn, you must be brilliant.

IB
(Baboon, 127
 
Points)
 on 7/19/12 at 10:40am
Tolland15's picture

3.96 at a Target? Watch

O
(Baboon, 150
 
Points)
 on 7/19/12 at 10:22am

I was taught that the human brain was the crowning glory of evolution so far, but I think it's a very poor scheme for survival.

JDimon's picture

I think some of the advice

(Orangutan, 252
 
Points)
 on 7/19/12 at 10:33am

There is already a book on you. That book is already being written. And if I talked to your friends, your teachers, your professionals, your family, I would know so much about you I wouldn't even have to meet you. You write the book the way you want to be

mdk6c's picture

I'd say that it's a little

(Baboon, 166
 
Points)
 on 7/19/12 at 10:45am
cauchymonkey's picture

Right, there's clearly a

(Baboon, 136
 
Points)
 on 7/19/12 at 10:49am
Anomanderis's picture

I'm afraid I don't understand

ST
(Orangutan, 357
 
Points)
 on 7/19/12 at 11:19am

But Rhaegar fought valiantly, Rhaegar fought nobly, Rhaegar fought bravely.

And Rhaegar died.

couchy's picture

Shoot for equity research or

(King Kong, 1,365
 
Points)
 on 7/19/12 at 12:35pm
cauchymonkey's picture

@couchy Thanks! I've taken

(Baboon, 136
 
Points)
 on 7/19/12 at 1:49pm
couchy's picture

cauchymonkey: @couchy Thanks!

(King Kong, 1,365
 
Points)
 on 7/19/12 at 3:39pm
notamonkey's picture

Tolland15: 3.96 at a Target?

HF
 
Points)
 on 7/19/12 at 4:09pm

All I care about in life is accumulating bananas

cauchymonkey's picture

@couchy my first semester of

(Baboon, 136
 
Points)
 on 7/19/12 at 4:50pm
Tolland15's picture

notamonkey: Tolland15: 3.96

O
(Baboon, 150
 
Points)
 on 7/19/12 at 5:00pm

I was taught that the human brain was the crowning glory of evolution so far, but I think it's a very poor scheme for survival.

JDimon's picture

I think the advice of

(Orangutan, 252
 
Points)
 on 7/19/12 at 5:13pm

There is already a book on you. That book is already being written. And if I talked to your friends, your teachers, your professionals, your family, I would know so much about you I wouldn't even have to meet you. You write the book the way you want to be

Soldier of Fortune's picture

i still think based on your

(Monkey, 62
 
Points)
 on 7/19/12 at 7:10pm
couchy's picture

curious if you just feel

(King Kong, 1,365
 
Points)
 on 7/19/12 at 7:12pm
nontarget kid's picture

Any advice for non-targets

ST
 
Points)
 on 7/19/12 at 7:16pm
cauchymonkey's picture

@couchy : wouldn't say I'm

(Baboon, 136
 
Points)
 on 7/19/12 at 7:58pm
MiddleofNowhere's picture

MSNBC and CNBC are two very

(Chimp, 15
 
Points)
 on 7/19/12 at 8:49pm
notamonkey's picture

Tolland15: notamonkey: To

HF
 
Points)
 on 7/19/12 at 10:33pm

All I care about in life is accumulating bananas

Gray Fox's picture

Read these books: Margin of

HF
 
Points)
 on 7/19/12 at 10:56pm
FranciscoDAnconia's picture

nontarget kid: Any advice for

(Baboon, 133
 
Points)
 on 7/20/12 at 11:00am
darth_sidius's picture

Market Folly -

CO
(Chimp, 15
 
Points)
 on 7/26/12 at 10:26am
allinthegame's picture

i would try to find out what

IB
 
Points)
 on 8/4/12 at 12:04am
tempaccount's picture

Take a statistics course or

HF
(Baboon, 106
 
Points)
 on 8/4/12 at 11:19pm

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