Which is better, an MBA or PhD?

[rufus_4000]

Quote from mrclean:

Where do you guys think the best salary and/or overall job opportunities in finance exist for a current physics student? A PhD, possibly in mathematical finance, or an MBA.

The PhD would probably be better to land a quant job, but I've recieved ambiguous info. about that career from browsing around these boards... I've read that it's a highly competitive, high paying job that everyone wants and I've read horror stories about working 12 hrs a day as a computer monkey, programming code and taking crap from traders.

Also, can you get into business school strait out of college, or do you need to work for a while first? I still have a lot of learning to do about this whole financial industry.. thanx

I have a doctorate, but not in finance, so maybe I am biased here. First of all, MBA and PhD are substantially different degrees, even if one does not plan on a career in finance.

MBA, IMO, is a professional degree, it teachs the basics of business analysis and management. In finance, MBAs tends to be research analysts, bankers, basically everything except quants. If you want a good (great) future in finance, I would recommend that you focus on the top-flight b-schools as your MBA, which means you will need working experience. Only getting an MBA from a top flight school can you have a fairly good chance of doing finance at a top house.

PhD, on the other hand, is an academic degree, it focused on in-depth research on one or more academic problems. Keep in mind that these problems may have little relation to the real-world finance problems at all. Which is why most quants in finances actually have hard-science phds. Finance PhDs tend to get on the strategists path, not a desk quant. It is just my opinion, but I won't recommend anyone to do a PhD and think about getting into real-world finance at the same time, you need to focus the 4-5-6 years on pure research in order to get your degree, not think about what you will do with it after. Instead focus your attention on publishing some good papers, getting your hand around some interesting problems should be your focus. Yes, if you can publish one or two papers in top end journals (JoFinance, JoFinEcono, JoQuantFin, etc), you can easily write your own ticket to any top financial firm, it is that easy. 3-4-5 of B-level papers (JoBusAndFin) helps too, but not even close to having a single A paper will help. To make a physics comparison (since you are a physics major), it is as difficult to get published on JoFin than JoPhysics. The paper rejection rate is at least 85%, and the review cycle is around 9-14 months.

My take is that if you want to make money, think about the MBA path, really. Only invest the 4-5 years for a PhD only if you like the academic and research aspect. In both cases, a top school is important, MBA much more so, in PhD, who your supervisor is matters more.

Hope this helps.

 

[PitchBlack]

I don't think it matters so much which one of the two you do.
A brilliant person will succeed no matter what he studies.

I have a cousin who did university apllied economics, and MBA in Chicago.
At his 33 he was member of the board of Directors at Bankers Trust.
At his 40 he stopped working, had his own airplane, and several houses in different countries.

Someone else i know studied psychology at the university. He is now CFO of one of the 10 biggest groups in a specific sector in Europe.

I also know someone who graduated from university and became a loser.

 

[bladerunner]

get an md or phd in pharmacology/pharmaceutics.
as ppl get older and living longer, they will need lot and lot of healthcare services including medicine.

 

[FXsKaLpEr]

Quote from bladerunner:

get an md or phd in pharmacology/pharmaceutics.
as ppl get older and living longer, they will need lot and lot of healthcare services including medicine.

Best advice yet!

then, invest your earnings wisely - stay out of the markets/trading directly.

give your money to the best managers in the industry to manage.

you'll do well.

 

[cooldude]

Quote from libertad:

I have PhD training in Economics with a focus on "prices"....
...
I have traded since 1978...and grew up in a single parent...poor environment...now I have several houses in several countries...and the world is my oyster....
...

Is that all? That is "peanuts" to a PhD and in Economics!
Anyway here is someone who contradicts what is commonly known as
"bright ones fail in trading the markets because they think too much and do too little".
Congratulations for having survived and thrived. (a bit cocky though!)


Please don't go for a PhD on Health Services just for the salary.
Damn, I may be one of the 'lucky' patients.

 

[Deringer]

Depends what you want to do....

If you want to trade and understand the most sophisticated and complex structured derivatives (where the real money's at), get a Ph.D and enhance your programming skills. They won't even look at your resume unless you have a highly quantitative background.

But if you want to be a derivatives salesman and make presentations on new products, get your MBA.

And if you just want to trade boring index futures for the rest of your life, you don't even need a high school degree. You just need to go through a quick and simple 3-day trading seminar, and then you're on your way to become a millionaire...... in your dreams.

 

[Kastro_316]

Quote from Deringer:

Depends what you want to do....

If you want to trade and understand the most sophisticated and complex structured derivatives (where the real money's at), get a Ph.D and enhance your programming skills. They won't even look at your resume unless you have a highly quantitative background.

But if you want to be a derivatives salesman and make presentations on new products, get your MBA.

And if you just want to trade boring index futures for the rest of your life, you don't even need a high school degree. You just need to go through a quick and simple 3-day trading seminar, and then you're on your way to become a millionaire...... in your dreams.

So are you saying people with just a degree cannot become excellent traders? The only good jobs (salery wise) out there that are ones that require a PhD? I feel sorry for you my friend. I have a hard time believing that career's in the trading world are only worth it if you have a PhD.

It all comes down to the individual.

 

[FXsKaLpEr]

Quote from Kastro_316:

So are you saying people with just a degree cannot become excellent traders? The only good jobs (salery wise) out there that are ones that require a PhD? I feel sorry for you my friend. I have a hard time believing that career's in the trading world are only worth it if you have a PhD.

It all comes down to the individual.

correct.

and if you look at the Forbes 400, many of the richest people on the list just finished high school.

Bill Gates, the richest man on earth, only finished high school.

 

[Deringer]

Quote from Kastro_316:

So are you saying people with just a degree cannot become excellent traders? The only good jobs (salery wise) out there that are ones that require a PhD? I feel sorry for you my friend. I have a hard time believing that career's in the trading world are only worth it if you have a PhD.

It all comes down to the individual.

Maybe you need to brush up on some high school reading comprehension, man. I didn't say that one cannot have a career in trading without a PhD. I only stated that in order to get into some of the more complex and structured derivative trading products (where the real money's at), one needs a PhD to be even considered for the role. I'm sorry, but your plain high school degree or GED is insufficient for you to price and hedge something like an exotic credit derivative swaption or know anything about the trading risk models.

 

[Kastro_316]

No need for the insult. My comment was not taken directly from what you said; I simply got the impression of something else, which you cleared up.