I have recently received a number of requests for opportunity and/or calls for advice on “how can one get into the finance industry”. This is the table topic for discussion at the upcoming CFA networking event on 23 Jul (Thu), details in the mailer from CFA Singapore, so mark down the details in your diary if this topic is of interest to you.
For those of you who know me well enough, you will know that my favourite slogan is “Continue Learning and Keep on Networking”, and I think this slogan is applicable for anyone in the finance industry, whether one is a fairly junior person like me, has significant experience of 5-10yrs, or even senior fund managers having more than 10 years of investment experience.
I have shared much on networking in my previous mailers, so today’s mailer will be largely centred on the aspect of learning or competency building. I understand most, if not all, of us have finished the CFA Program or are in the midst of doing the CFA Program. Learning doesn’t necessarily mean getting more and more certifications/ degrees, e.g. FRM, CAIA, ACCA, MBA, MFE—the list is endless. Learning is NOT a paper chase; it can be self-learning a new investment strategy/ perspective or simply deepening our understanding of a country/ sector/ industry. For those of you who are not yet in the industry and trying to find a suitable opportunity, learning also means broadening your market knowledge and getting yourself prepared for the obvious questions that are usually asked at interviews.
If you are preparing yourself for some quant related position, be sure you know how to solve, in a minute or two, simple statistics questions like this one: In a dice game, the payoff to a player is the number of points he rolls (i.e. he gets paid $1 if he rolls ‘1’, $2 if he rolls ‘2’, ….., $6 if he rolls ‘6’). Assuming this is a fair dice, how much should the player pay to play the game for this to be a fair game (i.e. he does not make any money in the long run)?
[I was asked this question when I was being interviewed for my current position three years ago.]
If you are preparing for some equity research position, be sure you know how to walk thru the equity valuation process (top-down/ bottom-up); what are the key drivers of a company’s earnings; how do you derive the fair value of your favourite stock say Singapore Airlines or NAV of Capitaland? If you don’t, then need to start thinking about it and also if you wish to invest some money to develop this kind of competency to better prepare yourself. I can help recommend some specialized training by an experienced instructor to build this kind of competency if one is keen.
Then, some people may say “Why don’t I wait till I find a suitable opportunity and then get my future employer to pay for whatever relevant training?” I know many of you may already be laughing at such remarks, but this is exactly what I am hearing from some of my students recently. In fact, I used to think this way many years ago and aspire to switch to a position requiring the body of knowledge from CFA Program, before I start investing in CFA training myself. I later realize that it’s really a chicken and egg situation: when an employer receives tons of resumes from job seekers, would he/she rather pick someone with relevant training and experience, or someone without any relevant training (and waiting to be trained)? The answer is pretty obvious. I eventually decided to proceed with investing in CFA training myself, and was fortunate to switch into the finance industry after passing CFA Level 2 exam.
In a nutshell, continue learning and Keep on Networking….and see you around at CFA luncheon talks and networking events. Have a good weekend.