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Finance major science options for grad school

  1. Sep 1, 2010 #1
    Ok, I was somewhat interested in finance when I was in high school, and I went to a community college and found the business classes very boring, so I started taking math and science classes, which I liked. I took up to Calculus 2, and some programming classes, and engineering physics I, and II. I was planning on transfering to an instate University that offered a program called "Applied computational and mathematical sciences" because this was where my interests were, in applied math, and especially computer simulations, which is exactly what the program was about, and it was highly regarded.

    I didnt get into the University though, either the first or second time I applied, and by that time I had become disenchanted with the idea aswell, and decided when I got into the other state university that I should major in Finance, because this university didn't offer a degree like that, and if I majored in pure math it wouldn't be exactly what I wanted and as a average math major I would have few job oppurtunities, but with less effort I could be a top finance major and probably have lots of job oppurtunities.

    Now I am a senior finance major, and so far I haven't been finding it very interesting, partially because most of the stuff is easy, and partly because I did a large research paper on the efficient market hypothesis, which is kind of a cornerstone of finance, and found it to be full of holes. Also, even for simple stuff like bond valuation, the methods they teach are actually incorrect and I asked a professor about this, and he said it was "a good observation" but that it was just the convetional way of doing it, even though it doesnt take into account compouding for interest less than a year.

    I have heard that you can go to grad school for things that arent related to your major, and I am wondering, is this really true?

    Could I really be accepted into say an applied math, or biology or engineering grad program, striaght, or would I have to redo my undergrad and get a second degree?
     
    Last edited: Sep 1, 2010
  2. jcsd
  3. Sep 1, 2010 #2
    My original post is quite long so ill just post my main question:

    Is it possible to go to grad school for say biology, or applied math, with an undergraduate degree in finance. I know that you can take undergraduate classes in grad school, but I don't know if this is actually possible, but assume I was able to get a near perfect GRE score like 99% or something.
     
    Last edited: Sep 1, 2010
  4. Sep 4, 2010 #3
    If all you have taken in math/physics/engineering is the basic freshman year sequence, it would be very hard to get into engineering/science/math graduate program. Think about how you can convince the graduate school admission committee that they should let you in, if you are one of the committee members what will you be looking for? People do go to graduate school to study a different area, but it is usually not true that it is totally unrelated or have very little exposure to.

    I am actually quite interested in your comment of the efficient market hypothesis, maybe you could help me understand more of some of the issues around it. In EMH, people talk about all information is reflected in price, but how is "information" defined in the first place? I have not seen any meaningful definition of that, do you know of any? I have been reading finance/econ articles, and I have an impression that some people are implicitly saying price = information, which makes EMH a trivially true but meaningless tautology. What is your opinion?
     
  5. Sep 4, 2010 #4
    It depends on the school you go to.

    My undergraduate degree was in mathematics, but I'm in graduate school studying computer science. I had to take "deficiencies" in order to prepare for the graduate curriculum, which were undergraduate courses selected by the department. At a more competitive school, I don't think I would have had the option of doing this. But I'm at a school mainly looking to fill seats so it was easier to do this.

    I would say that for grad school in math you should at the very least expect to take multivariable calculus and linear algebra. In addition, I would say almost every school will want abstract algebra and advanced calculus/elementary analysis. I'm betting there are some math profs here who would be willing to add to what they would expect someone entering a masters program to know.
     
  6. Sep 4, 2010 #5

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    There are a couple of things you need to be aware of.

    1. You're starting out two years behind. This adds two years to your completion time while you catch up, and makes you less marketable to grad schools. As mentioned before, you haven't demonstrated that you can do graduate-level or even upper-division undergraduate-level work. Also, the school has to wait two years before they can get some work out of you.

    2.Counting on getting in the 99th percentile on the subject test is, at best, wishful thinking and at worst shows a disconnect with reality. You are competing with people who have taken typically 10-12 more courses in the subject than you. Do you really think you will outperform them?

    3. If you don't like simplifying assumptions like the EMH (an even better example is the Law of One Price), you will not do well in science. The whole game is about finding various simplifying assumptions and when they can and cannot be used.
     
  7. Sep 4, 2010 #6
    I do not think it is possible, no decent mathematics department would accept students with a non-math background. However, if you want to apply for programs concentrated in "Finance" and that you have taken some advanced topics like Stochastic Calculus, Stochastic Processes, Measure Theory, Real Analysis, PDE, they could consider, but none otherwise, FWIK!
     
  8. Sep 6, 2010 #7
    I have only read the newspapers and wikipedia and maybe I misinterpret, but does this answer your question?

    "In finance, the efficient-market hypothesis (EMH) asserts that financial markets are "informationally efficient". That is, one cannot consistently achieve returns in excess of average market returns on a risk-adjusted basis, given the information publicly available at the time the investment is made.

    There are three major versions of the hypothesis: "weak", "semi-strong", and "strong". Weak EMH claims that prices on traded assets (e.g., stocks, bonds, or property) already reflect all past publicly available information. Semi-strong EMH claims both that prices reflect all publicly available information and that prices instantly change to reflect new public information. Strong EMH additionally claims that prices instantly reflect even hidden or "insider" information. There is evidence for and against the weak and semi-strong EMHs, while there is powerful evidence against strong EMH."
    http://en.wikipedia.org/wiki/Efficient-market_hypothesis
     
  9. Sep 6, 2010 #8
    The long and short of it is, yes, you can go to grad school in X subject without a BS in X subject. The caveat is, however, it has to usually be in a RELATED field (physics/computer science/engineering are all common ones that I've seen people successfully transition between) and you have to work ridiculously hard to make up for your lack of background in it before you're accepted and before you take the GRE or preliminary exam.

    It's rather unrealistic to expect an English major to successfully apply to any decent physics grad school or an actuarial science major to go for a PhD in chemistry. This isn't a death knell to your dreams of going to graduate school in a science but do understand you'll probably have to take a few years to do a BS or its equivalent.
     
  10. Sep 7, 2010 #9
    Sorry, I haven't checked this site in a few days. When they talk about "information" they mean information about the companies prospects. Although it is completely ridicoulous, they are saying that somehow the market is full of super-intelligent prediction experts who are able to take a news article or whatever about a company and calculate how this information will affect the companies prospects and risk. They don't ever show any evidence that this is the case, it's mainly just so that the economists can make all kinds of calculations.

    In fact, in one of the journal articles I read, Burton Malkiel, who is one of the originators of the EMH brings up the issue of why stock prices move constantly throughout the day. According to the EMH stock prices should basically be stable until information comes out, (which only happens rarely) and then the prices should immediately move to take account of this new information, but in reality they don't. Malkiel tries to explain this by saying that stock prices can also move due to analyst reports and upgrades and downgrades and this is why the prices move so much. First of all analyst reports only come out rarely, and secondly, this argument makes no sense, because presumably the analysts would be analyzing public information, and thus the stock price should have already accounted for whatever they would say. However, if the analysts were able to analyze public information, and come up with a better price then the market had already done, then this would imply that the markets did not account for all public information and were therefore not efficient.

    So he essentially he disproves his own theory either way while attempting to defend it.

    If you are interested, some of the most interesting papers I read, that had a real explaination for how the stock market works were these two (both of them were written by scientists using computer simulations and not economists, which I like because they don't have to start with a bunch of unproven and unlikely assumptions, and can just start with a blank slate, and watch the market build itself):
    Herehttp://www.google.com/url?sa=t&sour...g=AFQjCNF13M4FFgLVxrlvqY1h7MTSIbhx2g&cad=rja"
    and this one: (couldn't find a link) Palmer, R.G., et al. “Artificial Economic Life: A Simple Model of a Stockmarket.”



    "2.Counting on getting in the 99th percentile on the subject test is, at best, wishful thinking and at worst shows a disconnect with reality. You are competing with people who have taken typically 10-12 more courses in the subject than you. Do you really think you will outperform them?"

    I definitely do not think I could get 99th percentile on the GRE math subject test. I was talking about the regular GRE quantitative portion.

    One of the people at my school was a fashion major, who took a 2 operations management classes, (the first one is basically review of statistics classes, and the second probably isnt hard either) but scored 99th percentile on the quantative protion of the GRE and got into the PhD program at my school for Operations Management, which is pretty much pure math. Also, one of the profs at my school got a BS in biochemistry and then a PhD in finance, but I assume going from science to finance is a lot easier than the other way around.
     
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