Advice for Undergraduates

[albo]

I want to start a discussion that is mainly about Undergraduates. I'm currently a sophomore, and I'm following an accelerated program in Theoretical Mathematics, Financial Economics and Computer Science (two majors and a minor). I'm hoping that in five years I get both my bachelor's and my master's degree. As a kid, I was raised in a business environment, and I've seen the positive and negative aspects of the it, since my early age. That's possibly the reason that today I see myself as someone who loves Finance and has passion for it, rather than doing it just for money. The fact that bothers me the most today is that I see a lot of young people going into Quantitative Finance because they "want to get rich". That is very wrong. My advice for all the Undergraduates doing Finance out there, is that they should slow down and carefully analyze what they really want, and how they can best achieve it. In this times of economic downturn, the markets don't need people that are driven by greed. Instead, the markets need more people that are passionate and dedicated to bringing new developments and insights to the most beautiful industry out there: Financial Industry.
I am interested to know what other people think as well, so I will be waiting for comments and suggestions.

 

[DanM]

Technically, the modeling industry is "the most beautiful industry out there."

 

[albo]

Technically, the modeling industry is "the most beautiful industry out there."

It depends how you see it. In my opinion, you can get the most impressive results when you apply Modeling to Finance.

 

[Zeuge]

In this times of economic downturn, the markets don't need people that are driven by greed.

Naive idealism.

"Tell me, is there some society you know that doesn't run on greed?...The world runs on individuals pursuing their separate interests." - Milton Friedman

 

[Freakonometrics]

I'm a first year BSc Econometrics student (will probably choose Quant. Finance as major), the core programme is mostly mathematics/programming and some economics (sometimes it's referred to as hardcore economics). It is referred to as the get-rich-quick study because once upon a time 1/3 of graduating students would go on to be millionaires, slightly less so these days I hope. A lot of guys around me are also focused on "getting rich as fast and as lazy as possible".. Sometimes I ask them, why? Secondly, how? By studying you're basically working towards an end-point where you're equal to everyone who finished the same programme. Sure one may be smarter then the other, but most people just study, get a degree, and hope to get a great job to get rich. It's funny how

Personally I'm a sucker for competition, and I hate (read HATE) to lose. The finance industry offers a lot of challenges and therefore appeals to me. On a side note: yes, I do want to make a lot of money. That's probably because it runs in my family, entrepreneurial blood runs through my veins.

 

[albo]

Naive idealism.

"Tell me, is there some society you know that doesn't run on greed?...The world runs on individuals pursuing their separate interests." - Milton Friedman

I was born an idealist, and I think most science people are... After all, idealism is the source of some of the greatest ideas and theories that we have today, that were developed by people that could see more clearly than the rest.

When I talk about greed, I'm not saying that it shouldn't exist, because we all are aware that it is part of the human nature. I'm saying that there should be a rational amount of greed, that helps people achieve more and better, without damaging themselves and the society.
Since you quoted Milton Friedman, I will also do the same thing:
" The problem of social organization is how to set up an arrangement under which greed will do the least harm, capitalism is that kind of system ".
-Milton Friedman

 

[Zeuge]

My point was that we are all, whether we acknowledge it or not, driven by greed and self-interest. If by a non-"rational amount of greed" you mean the kind of greed that causes insider trading and other illegal activities, I'll agree with you. It's just naive to expect people to act in the interest of society as a whole out of some kind of altruism, they will only do so if it benefits them (if you gain utility from helping others, it is in your self-interest to help them, and so on)

 

[albo]

My point was that we are all, whether we acknowledge it or not, driven by greed and self-interest. If by a non-"rational amount of greed" you mean the kind of greed that causes insider trading and other illegal activities, I'll agree with you. It's just naive to expect people to act in the interest of society as a whole out of some kind of altruism, they will only do so if it benefits them (if you gain utility from helping others, it is in your self-interest to help them, and so on)

Yes, I agree with you. That is the kind of behavior that I was talking about. And you are right when you say that people should pursue their self interests. After all, society can achieve maximum efficiency when all individuals are doing their best in the directions that they choose to pursue.

 

[bigbadwolf]

"Tell me, is there some society you know that doesn't run on greed?...The world runs on individuals pursuing their separate interests." - Milton Friedman

Sounds like Friedman was another disciple of Ayn Rand (along with Alan Greenspan).

 

[albo]

Sounds like Friedman was another disciple of Ayn Rand (along with Alan Greenspan).

I'm not sure about that, but I can clearly see some similarity in their way of thinking. However, the very essence of Ayn Rand's philosophy is itself questionable. She named it "Objectivism", but I think it was in fact a very strong subjective way of thinking, with the individual being her primary subject. Her work is artistically admirable though.

 

[bigbadwolf]

Her work is artistically admirable though.

Sure. Classics like "Atlas Shrugged" can compare with Tolstoy's "War and Peace."

 

[yzia]

I was born an idealist, and I think most science people are... After all, idealism is the source of some of the greatest ideas and theories that we have today, that were developed by people that could see more clearly than the rest.

When I talk about greed, I'm not saying that it shouldn't exist, because we all are aware that it is part of the human nature. I'm saying that there should be a rational amount of greed, that helps people achieve more and better, without damaging themselves and the society.
Since you quoted Milton Friedman, I will also do the same thing:
" The problem of social organization is how to set up an arrangement under which greed will do the least harm, capitalism is that kind of system ".
-Milton Friedman

Sigh, I remember when I was young and naive (being only 23, I'm sure I'm still young and naive). Fact of the matter is, greed always breeds more greed.

 

[albo]

Sigh, I remember when I was young and naive (being only 23, I'm sure I'm still young and naive). Fact of the matter is, greed always breeds more greed.

I think it depends more on the character of the person. By the way, there's also a theory that greed is good. Although it hasn't been proven yet!

 

[soliton]

I think it depends more on the character of the person. By the way, there's also a theory that greed is good. Although it hasn't been proven yet!

I don't think you can ever prove any social theories, even to call that a theory might not be a correct statement in the first place. However, I'd love to be proved wrong, if anyone knows any social "theories" that can be proven as in mathematical sense I'd like to know

 

[IlyaKEightSix]

I think Friedman and Ayn Rand are correct. Put it this way: if you bust your ass, get next to nothing, and the schlub the next door over gets as much as you do by milking the system, will you be as motivated to work?

We see it play out everywhere...including on the football field, which is why DeSean Jackson is dogging it for the Eagles .

I believe the 20th century was about the grand experiment in trying to make people pursue the collective interest--and whether in Mao China or Stalin Russia, it failed miserably.

 

[albo]

I don't think you can ever prove any social theories, even to call that a theory might not be a correct statement in the first place. However, I'd love to be proved wrong, if anyone knows any social "theories" that can be proven as in mathematical sense I'd like to know

It depends on what you call "proving a theory". Every theory is based on assumptions, and the quality of a theory depends on how well it predicts the future, not on how good its assumptions are. A famous example of a social theory that is generally accepted is Game Theory, whose essence was captured and described in mathematical equations by John Forbes Nash. However, you're right when you say that it is extremely hard, not to say impossible, to scientifically prove social theories.

 

[albo]

I think Friedman and Ayn Rand are correct. Put it this way: if you bust your ass, get next to nothing, and the schlub the next door over gets as much as you do by milking the system, will you be as motivated to work?

We see it play out everywhere...including on the football field, which is why DeSean Jackson is dogging it for the Eagles .

I believe the 20th century was about the grand experiment in trying to make people pursue the collective interest--and whether in Mao China or Stalin Russia, it failed miserably.

Things are much deeper than that. You are posing a question that is very much related to the discovery of the human nature. If someone that is working less than you, gets more than you, then this fact might as well motivate you to work even harder in order to be in the same level. It's all stochastic systems, if you have ever studied the field. If you keep multiplying probability matrices with the same payoff, they will diverge at a certain point. Similarly, if you keep working hard enough and staying focused on your goals, one day you will achieve them.

 

[WushiX]

I like making music more than doing math equations and reading the Wall Street Journal. Are you saying that I shouldn't work in math/finance and just make music instead?

It pisses me off when people say "money's not important, do what you love". Get real. If you genuinely love finance and would happily spend 100 hours/week staring at Excel and editing Powerpoint slides for $40k/year and no bonus, then that's great for you. But for the rest of us, money does have an impact on what sort of job we're willing to work.

There's nothing wrong with greed. Without it, we'd have a lot less entrepreneurs and innovators in this world.

One last thing: You're a sophomore in college. No offense but you're not really in a position to be giving out career advice to undergraduates.

 

[MRoss]

That's possibly the reason that today I see myself as someone who loves Finance and has passion for it, rather than doing it just for money. The fact that bothers me the most today is that I see a lot of young people going into Quantitative Finance because they "want to get rich". That is very wrong. My advice for all the Undergraduates doing Finance out there, is that they should slow down and carefully analyze what they really want, and how they can best achieve it.

Fresh undergrads can't possibly know what they want to do with the next 60 years of their lives. They haven't really experienced anything specific yet. A great place to start experimenting would be with courses that could potentially land you a very nice salary...

 

[Daniel Duffy]

I'm not sure about that, but I can clearly see some similarity in their way of thinking. However, the very essence of Ayn Rand's philosophy is itself questionable. She named it "Objectivism", but I think it was in fact a very strong subjective way of thinking, with the individual being her primary subject. Her work is artistically admirable though.

Her theory of Concepts seems to be based on Frege's (rigid) Attributes. This might explain the one-dimensional characters in her novel.


There's nothing wrong with greed. Without it, we'd have a lot less entrepreneurs and innovators in this world.
Wrong; just check out Dyson vacuum cleaner (5000 failed prototypes). And the Victorian Rotchilds.