MFin and MBA

A common question is whether someone should apply for a master of finance degree or an MBA. In the US, the conventional two year MBA allows time to cover the same modules as a one year finance masters. In that case the students spend two years but get a lot more than just finance knowledge. I think this is one reason that the MFin market in the US is quite small, other than for financial engineering courses.

In Europe, London Business School has the same two year model. A former member of the LBS finance faculty once told me that some of his colleagues regarded the MiF [Masters in Finance] as “the MBA with all the **** taken out”. I take this to be a joke. The more serious point is that if one is pretty sure about a career in finance, the cost of doing a two year MBA is clearly harder to justify.

Other European business schools, including Cambridge Judge Business School offer a more clear separation between one year MBA and one year master of finance. It’s not possible in one year of a general MBA to do that much finance, even though we offer a lot of finance electives on the MBA at Cambridge.

Correspondingly we do offer a small amount of non-finance content on the Cambridge MFin, for two reasons. Firstly, I thought when setting up the course that it was desirable. Secondly, and more importantly, the financial institutions and banks I spoke to strongly agreed. On a hard and busy course like the MFin it’s sometimes hard to justify the extra time on business effectiveness, management practice, marketing, strategy and so on. But I really think it’s worth the effort. It’s interesting (to me) to note that LBS has something similar on its MiF too, despite the (perhaps old fashioned) views of former faculty there.

Ultimately, finance recruiters are looking for very smart, hardworking people. Their next consideration is “people-skills” – is the candidate going to be good with clients and able to work with colleagues? This is less critical in some jobs such as being a trader or quant analyst but the majority require some degree of human interaction.

When recruiting potential MFin students, which has now started again, we therefore look first for strong analytical intelligence (which is not the same as being good at maths) and second for the potential to work well with other people. Even if someone is looking for a less client-focused job, they need to be able to join in with the rest of the class and contribute to the social side of things.

If a person is not sure about remaining in finance, a general MBA will give them a platform for a much wider range of roles, including potentially staying in finance. But if they remain in finance their career options will probably be fairly restricted to their former field. An MBA is often used for career “switchers” but a one year MBA doesn’t really give much chance for switching within finance, unless one is aiming for a strategy/corporate planning type role for which prior finance experience plus an MBA would be an ideal combination.

15 Responses to MFin and MBA

  1. Dear Mr. Taylor,
    As a person who did a very careful research on dozens of universities before making his final choice on JBS, I can share the experience I got. I actually got the image that an MBA is rather a point of being “prestigious” for many universities, than only offering a true academic program of study. I received advertising from various schools, some of which seemed to me have absolutely no connection with business. I even can bring a citation from one of them “The university X was formerly established as a musical institution which was recently reorganized and opened its state of arts business school”. I may understand that the University X might have been able to attract good professors to instruct their MBA course competitively, but what is strange to me, that being a newly reorganized university it set a program fee on its MBA, that was a way higher than those of the most prestigious business schools.
    Almost any university, no matter of its location and size, offers now an MBA, while very few offer MFin or similar Finance related Master’s. After a while, I found the answer, that the matter is simply a wider promotion of MBA in the public as a degree “which opens gates towards prosperous career and success”. In contrast, the Master in Finance has indeed the true image of a “hard and demanding program”.
    What I also was surprised at, is despite of MBA’s being a degree aimed to working professionals, many universities offered admission to fresh graduates. Again, in contrast, those who offered MFin, had a way harder requirements and admission criteria.
    Eventually, I think, that the most important issue here is rather how these two programs are presented to the public, than only their course syllabus, duration and main target.

  2. Dear Dr Taylor,

    I have just noticed that in October 2010 the Saïd Business School has started a MSc in Law and Finance for students with a prior background in law.

    Do you think the MFin may include more electives in law in the future? Not only to attract additional students (without a prior background in law) but also to address new problems at the intersection of law and finance.

    Best regards,
    Lucas

    • We are planning an elective taught by a member of the Law faculty for the year 2012-13. Law and Finance is an interesting area but one that is somewhat distinct from Finance. The Cambridge Law faculty is launching a new Masters degree in corporate law in a year which will provide a better basis for some sharing between our two degrees. There are already regular seminars run by the Centre for Corporate Law which are open to MFin students and the faculties of law, economics, maths, land economy and the Judge Business School all collaborate through the umbrella organisation Cambridge Finance.

  3. Dear Mr. Taylor:

    I know that the academic requirment for the Cambridge JBS MFin programme is an undergraduate GPA and know that the GMAT score is optional.

    I want to know if I am doing my MBA at a US Grad School (1Y programme) would my MBA GPA be sufficient to offsett the academic requirment for the MFin programme.

    Thanks!

    • As MBAs are not primarily academic programmes and don’t provide a good basis for judging a person’s ability to do the MFin, we don’t use MBA grades in our assessment of previous academic achievement.

  4. Dear Simon,

    If I miss the minimum 2 years experience by 1 month, should I still consider applying? After much research, I feel that this programme is the most relevant for me and am really interested and eager to apply.

    Thank you!

  5. Dear Simon,

    if I narrowly missed the US GPA Requirement (3.55 vs 3.6 Overall) but maintained a 4.0 in all of the major finance courses I completed would I still be favorably considered? First two years of undergrad were met with great struggles…

    At the start of the program I would have completed just over three years full time work experience in finance and a previous 1.5 year internship in finance as well.

    Strong extracurriculars and Volunteer experiences which has led me to complete an MFIN application.

    Thank – you!

  6. Dear Mr. Taylor,

    Thank you for this very interesting article.

    I have one question regarding admission. Could the completion of the CFA programme be considered a waver for an undergrad degree.

    Thank you.

    Regards,

    AV

  7. Dear Mr. Taylor

    I have completed B. Com (Hons.) from a reputed college in India with a First Class Grade.

    However, Commerce Degree from my College is not considered a recognised Degree from a Recognised University as per the Cambridge University Website, which makes me ineligible for the Msc Finance program. I need to complete a Master Degree with high marks to qualify as a Second Class Degree Candidate from India (not a First Class Degree), which I believe will work strongly against me during Admissions.

    So, if I complete CFA and a Master Degree from a top ranked University in Europe, will I still be considered unfavourably by the ADCOM?

    Does having completed CFA previously increase admission chances significantly?

    Thanking You

    Best Regards,
    VD

    • Having the CFA is a useful addition to a candidate’s application but it is not a substitute for the academic requirement. We look at all a candidate’s academic qualifications. If a person did well on a later degree, despite a less strong performance on their first degree, this would be favourable evidence that they meet the standard for the MFin. But we do not encourage people to take two masters degrees in finance from good universities. This can look negative on a CV, as interviewers will wonder why a person did two masters in a similar subject.

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