On Monday 23 June the FT is expected to publish its first ranking of master of finance degrees. The FT consulted a number of business schools about this to try to make sure the rankings made sense, especially in comparing apples with apples. In the class of master of finance degrees there are at least three categories to bear in mind: do they require prior work experience (and in finance)? are they aimed mainly at quants (financial engineering degrees)? and are they intended primarily for further study (ie pre-PhD) or for working in financial practice? As you can generate nine types of degree from these categories there is a danger in a single ranking. You could also add the selection criterion: in Cambridge finance we select mainly on prior academic achievement but most other degrees use GMAT, which I personally regard as a very noisy signal.
The MFin team took part in the FT consultation as constructively as possible on the view that, whatever the merits of a ranking, the less distorted and misleading it is the better. In any case, the FT has decided to include only those degrees with at least 30 students who graduated three years ago (since a large part of the ranking depends on the salary three years on). Both Cambridge master of finance degrees (the other being the pre-experience MPhil in Finance, probably the most competitive degree to get into in the whole of Cambridge University – you need the equivalent of a first class degree even to be considered and most students came top of their class) are therefore excluded. Whether we would have wanted to be included is therefore, for the moment, academic.
1. In the job market, misunderstanding has been taken place. A lot of people could not distinguish between the following :
i) Master Of Finance.
ii) MSc in Finance.
iii) Master of Financial Engineering.
I think the first one should be compared with MBA in Finance because it is a post-experience degree and targets financial professional. The second and the third one target the persons who have an extreme prior academic achievement and may want to work in an academic field.
2. I think Cambridge master of Finance is one of the top 20 master of finance across the globe because of the following :
i)It is taught within Cambridge Judge Business School – a world-class provider of business education
ii)The School is situated at the heart of Cambridge University. The reputation of the University is as important as the reputation of the School and the program.
iii) the MFin curriculum – The Master of Finance degree is a CFA Programme Partner.
Here is my questions:
A) do you agree with what I have mentioned?
B) Is Mphil a CFA Programme Partner? If not, there are a lot of fresh undergrads intersted in studying CFA, which might be a disadvantage at Mphil.
The different degree titles don’t necessarily mean anything: MSc, MPhil, MFin, MiF in themselves are just titles used by different universities. A degree is in financial engineering is clearly different from one in finance. So we’re back to the key difference in respect of pre/post experience and the more subtle differences in admissions policy. I don’t know the official entry criteria for other finance masters degrees but I’m confident that the majority are academically less demanding than the Cambridge MFin and without doubt they are less demanding than the Cambridge MPhil in finance. I’m not sure what an MBA in Finance is: an MBA is a general management degree.
The credibility of a university depends, among other things, on who it admits and who it rejects. Cambridge has a good reputation because it continues to admit very able students. A less able student would not acquire the Cambridge reputation just by turning up. On the contrary, the continued quality of the students is what reinforces the University’s reputation. This is a general feature of educational institutions and such organisations as night clubs. If fashionable people go to a club it becomes fashionable. But if not, the club stops being fashionable.
There are some universities around the world whose degrees are prestigious because they are so hard to be admitted to. The “value” is entirely in the selection. Secure in this knowledge, the students don’t work hard and the teaching is not of high quality. Cambridge (like all the best British universities) is not like that. At both undergraduate and graduate level, the students continue to work hard and (especially at undergraduate level) are fiercely high achieving. The upshot is that Cambridge’s “value” lies both in the stringency of selection and in the process of learning and teaching which goes on afterwards.
So admissions criteria are necessarily high at the more prestigious universities, including Cambridge. Whether we are are in some notional top 20 list compiled by a newspaper is of no interest to me.
The MFin is a partner of the CFA but the MPhil is not, reflecting differences in their curriculum. The MPhil is particularly suitable for students intending to do a PhD, which the MFin is not.
I am extremely disappointed by the Director’s remarks regarding the criteria used to select students:
“You could also add the selection criterion: in Cambridge finance we select mainly on prior academic achievement but most other degrees use GMAT, which I personally regard as a very noisy signal.”
In my point of view this is a huge error for multiple reasons:
1) under this rule Cambridge assumes that the previous University was best positioned to evaluate what is a Cambridge student, i.e., Cambridge largely disregards its own ability to select students. You are always as good as your weakest link. In this case it only represents previous University’s view of the student not Cambridge’s perspective;
2) under this criteria Cambridge immediately excludes everyone that for reason may not have had a stellar academic performance. Again, this puts emphasis on previous University’s academic rationale: repetition, work, creativity or sheer intelligence;
3) outrightly disregards any brilliant people that may have had an unorthodox career path;
4) GMAT could undoubtedly create noise but just considering previous results is an even bigger mistake. It’s simply forbidding people from evolving and improving;
All in all, as a Finance Practitioner (with an undergrad and Professional qualifications) this proves that Cambridge doesn’t want to be connected to reality, real markets, real challenges, real people and reward brilliancy and evolution. (I’m happy to expand on this rationale but for simplicity and to keep this brief I will spare all the discussion).
Unfortunately, although I am actively researching a Master in Finance and, being a Top University, would be a natural choice but I have discarded Cambridge as my choice as I vehemently disagree with Cambridge’s policy.
I want to study (as colleagues) with the most brilliant and inspiring minds not the best grade students and that is a HUGE difference.
The MFin is the same as all Cambridge graduate degrees except the MBA in its policy of relying on previous academic achievement. This undoubtedly means that some people who were unlucky in their earlier academic career will not be admitted. But we need evidence that a person is capable of passing a difficult academic degree. The MFin is a degree, not a training course and not the same as the CFA. But that is the nature of a leading university. I believe all leading universities have the same policy. Cambridge (and Oxford, Stanford, MIT etc) have a strong reputation because they select in this same way. In an ideal world it might be better to have a detailed individual evaluation of every student. But this is simply impossible given our resource constraints. We do interview every candidate and apply our own judgement. But we have to optimise our use of information, just as investment banks will normally not interview anybody with the equivalent of a British lower second class degree or below.
As to GMAT, it is designed to test for admission to management degrees and the MFin is not a management degree. I’ve observed people with a high GMAT who were not academically that impressive and more importantly people with a low GMAT who were excellent. The GMAT score reflects a range of inputs, including the time taken in preparation. While a very high GMAT (top 1%) must be sending a pretty strong signal of academic quality, a slightly lower score is not, in my experience, a reliable indicator.
We have MFin students from many different countries and backgrounds so there is no evidence of any systemic bias. The system is imperfect but, I believe, as fair as it can be with finite resources. Having worked in finance for 14 years I’ve seen a wide range of brilliant people. I agree that a few did not have outstanding academic qualifications. But if you must use one selection filter, I believe the industry is right to use academic achievement as that filter.