From the monthly archives:

March 2014

Odds are, if you went through all the trouble of getting a top-tier business degree, worked 80 hours a week as an analyst at a bulge-bracket bank while you earned your MBA degree and your CFA designation, and are now looking to get on track for a managing director job, the last thing on your career calendar is to be an activist. Sorry, hippies, but Wall Street is already occupied and you can’t have it.

Still, an increasing number of investment banking jobs are tied to shareholder activism — on both sides of the fight. There are jobs to be had in the financial services industry for those who want to bring about change at publicly traded companies, and for those who want to stave it off.

Take for example the case of the FTSE 25o transportation company FirstGroup which, according to British news outlet The Telegraph, is now at least three percent owned by American activist hedge fund Sandell Asset Management. According to reporter Ben Martin, Sandell has kibitzed in the strategic decisions of other companies in which it holds a significant stake, such as Spectra Energy and Bob Evans Farms. Martin’s article speculated that Sandell might call for divestiture of FirstGroup’s non-core school bus business and for the head of CEO Martin Gilbert. So you can imagine, if you were Gilbert, or any other career executive at FirstGroup, your first instinct is to call up an investment bank requesting some air cover in the form of an anti-takeover team. (Gilbert had long since agreed to step down, but we’re sure he still preferred to pack his own parachute.)

A quick Web scan reveals that the no less formidable bank Goldman Sachs had posted a job opening for a shareholder activism associate in its M&A practice. Responsibilities included “to provide advice to internal teams and external clients regarding preparing for hostile activity, activism, corporate governance and shareholder related issues. The position includes creating presentations for clients and internal teams. The banker also will work on live raid defense and proxy fight defense situations; drive marketing and targeting initiatives; develop thought pieces on various topics.”

Sounds exciting, doesn’t it?

Shareholder activism isn’t a new thing, of course. It’s been around, no doubt, since the first share-issuing enterprise held its first annual meeting. But lately there’s been an uptick in return on — and thus participation in — event-driven strategy as an investment driver. A recent Credit Suisse report cited in Pension & Investments suggests that, as of the end of August 2013, event-driven hedge funds have returned 8.6% to investors year-to-date, or more than double that of all hedge funds tracked, which can bring out the busybody in any of us. And it’s not just hedge funds that are placing these bets. No less, a buy side behemoth as Fidelity Investments is getting into the act, according to Investment News.

So whether your intention is to be on the buy side, the sell side or the advice side, this could be a wave to ride for the next, oh, well, until people start leaving other people alone to do their jobs.

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Stephen R. Covey, the all-earnest, ever-cheerful guru of professional development, has addressed a new topic: how to go from having a job to pursuing a career.

He and collaborator Jennifer Colosimo might have published their self-help manifesto Great Work, Great Career (table of contents and preview available here) back in 2009 but, considering the economic free fall in recent years, we all deserve a pass on having missed it. Suffice it to say, now that the recovery is well underway by all accounts, and that Washington has no new plans for scotching that, the timing might now be perfect for you, the professional seeking investment banking jobs, to explore the concepts covered in the book.

If you’ve read Covey’s 1989 breakout The Seven Habits of Highly Effective People, you know that he was fond of such advice as “Be proactive” or “Put first things first” among other Captain Obvious-isms.  This is the guy who added “synergy” and “win-win” to the lexicons of middle-managers and MBA students everywhere. Even so, you got to give credit to the innovator who established these buzzwords.

This time out, Covey offered words that one can hope that the business world will take to heart: “contribution,” “loyalty,” and “trust”. To demonstrate your ability to contribute, one should be able to state, clearly and cogently, “how you can use your abilities and strengths to get to the bottom of an employer’s problems,” Covey and Colosimo advise. As for loyalty and trust, which the authors describe as “the fruit of your character and your conscience,” we can all hope that these are not new concepts to people looking for jobs in the investment banking industry. IB has always been a reputation business and, more and more as the world gets smaller and smaller, the rest of the economy is catching up.

But perhaps Covey’s greatest lessons about how to market yourself can be taken by example. The man was not exactly shy. You can buy his book in hardbound or paperback or ebook or audiobook or even iPhone app. You can spend several hundred dollars buying all the accompanying videos, tools and exercises, not to mention access to discussion groups and a personal goal manager.

So have confidence. Those investment banking jobs are out there. Just stay positive, be a problem solver, consider yourself a volunteer to a cause rather than an employee to a boss, think about the long term and, most importantly, be a paragon of personal integrity.

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QuantNet released its biennial review of North America’s top 25 graduate-level financial engineering programs and once again the Tepper School of Business at Carnegie-Mellon University takes valedictory honors. If you’re beyond brilliant, have masochistic tendencies, are willing to pay $77,100 in tuition and can spend two years in Pittsburgh, you too can earn CMU’s coveted Master of Science in Computational Finance degree. (There is a Wall Street satellite campus, consisting of two classrooms and a lounge.)

Number two on the list is shared by the Ivy League tag team of Princeton University and Columbia University; Columbia wins the intramural battle of New York-based programs. Of course, you could go to the tied for third place Baruch College of the City of New York University for less than half the price of the number two programs — and if you’re planning on marketing yourself as an empirical guru, you have to at least consider that. Baruch ties with University of California at Berkeley’s Haas School of Business, the best of the West.

Next on the list is Columbia again — its separate Mathematics of Finance program playing second fiddle to its traditional MFE course. No list in this field would be complete without the Massachusetts Institute of Technology’s Sloan School of Management representing New England (Harvard and Yale didn’t even rank.)  The Top 10 are rounded out by a tie between Cornell University and Atlanta’s Georgia Institute of Technology, the first among financial engineering programs in the South.

Other notables lower on QuantNet’s list include two Rutgers University programs, another Baruch program (in contrast to Columbia, CUNY’s Mathematics of Finance outranks its MFE), and the sole Canadian entry, the University of Toronto.

The biggest surprise in this latest list, as compared to that of two years ago, is that tech-savvy Stanford University sank since the last ranking — from a sixth-place tie with rival Berkeley to falling off the list altogether. North Carolina State University and Ohio’s Kent State University also missed the cut, but they were on the bubble to start. This cleared the way for newcomers: The University of Washington, The University of Minnesota and Baltimore’s Johns Hopkins University.

Still, there can only be one first-place winner, and CMU’s MSCF distinction is it. According to recent alumni, it’s unparalleled not just in its reputation, but in its ability to deliver the skills that buttress that reputation.  “The time I spent at CMU in Pittsburgh was definitely the most satisfying in my academic life,” says Sudhanshu Ladha, ’11. “The MSCF program is rigorous, practical and provides you with an extremely solid foundation for any job related to financial engineering, trading or quantitative analysis. … [It] also helped me get exactly the job that I was aiming for and I don’t think I could have been better prepared by any other course.”

As with anything, you’re not likely to get any more out of it than you put into it but, if you’re a quantitatively-inclined person looking to maximize your value while applying for investment banking jobs, it behooves you to check out the relative merits of MFE programs.

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