Masters in Finance

What to expect from a Masters in Finance

Typically, a Masters in Finance will last one or two years, depending on the institution and location. Most institutions run Masters in Finance courses with one of the following focuses:

1. To prepare qualified undergraduates for careers in mid- to senior- level financial positions such as in financial analysis, investment management and corporate finance.

2. To help established financial professionals to advance in the workplace, build on and update their skills and knowledge, or change career specialization.

The level of specialization offered varies; some Masters in Finance allow students to study a range of finance topics before choosing a specialization, while others are highly specialized right from the start of the course.

You will be required to attend lectures and seminars, and produce coursework or a thesis in an advanced topic integrating and applying several subjects learnt during the degree program. Students may also need to attend workshops in quantitative methods, create projects to put theory into practice, and go to speakers’ events attended by industry professionals.

In addition to the qualification you will receive from your institution, you may also be able to take high-level professional accreditations such as the Chartered Financial Analyst (CFA) exam designed to test candidates’ readiness for the professional finance world. Although the level of content is comparable to a Masters degree, the concept behind the CFA and their examination methods are different although some institutions do embed a significant percentage of the CFA program “Candidate Body of Knowledge” into their degree programs.

Entry requirements for a Masters in Finance

Courses aimed at established financial professionals often require prospective students to have at least two years’ work experience in the finance sector, or in a finance-related profession. However, many Masters in Finance degrees are open to applicants who have come straight from completing an undergraduate degree – either in finance or a related subject, such as business, economics or mathematics.

Prospective students may also be required to take the Graduate Management Admission Test (GMAT) or the Graduate Record Examination (GRE), subject-specific proficiency tests, or language proficiency tests. Some Masters in Finance programs require completion of pre-enrolment courses, such as Introduction to Mathematics/Finance/Accounting.

Finance specializations

Depending on the course curriculum, you may start out by studying a selection of core finance topics, such as accounting, corporate finance, financial valuation, behavioral finance, derivatives, capital markets, econometrics, financial modeling, quantitative methods, investment management, financial regulation and financial reporting.

Further on, a Masters in Finance should allow students to choose from one or several focus areas, developing their own research project. Some of the finance topics you may choose from are explored below; these may be offered as entire courses in their own right, or as possible pathways within a broader program.

International finance

Sometimes called multinational finance, international finance is a broad branch of financial economics concerned with interrelating monetary and macroeconomic perspectives. Finance topics covered here may study include international monetary systems, international taxation, exchange rates, foreign direct investment, translation exposure and political risk.

Specializing in international finance could lead to financial careers in specific countries or systems, or within companies or organizations operating globally. Possible sub-specializations include Islamic finance; finance and aid in developing economies; the intricacies of international financial law or trading in the international financial market.

Financial management

A specialization in financial management is a good option for those keen to pursue financial careers in the corporate, banking, insurance and financial services sectors. Topics covered are likely to include corporate finance, accounting, financial markets, capital budgeting, shareholder dividend policies and allocation of assets. Master’s students may specialize in a particular aspect of financial management, in preparation for a specific career path, and should become proficient in the various tools and competencies needed to manage, analyze and advise on different types of financial data and products.

Financial econometrics

Econometric techniques, more commonly used in economics, involve the application of mathematical, statistical and computer science methods to economic data. Financial econometrics is regularly used in the finance industry during portfolio management, risk management and in the analysis of securities.

Students specializing in financial economics will examine the relationship between econometrics and finance at the methodological and empirical levels. Topics covered may include quantitative asset pricing, financial derivatives and topics relating to volatility processes, continuous-time processes, extreme values, long memory, endogenous sampling transaction data and microstructure of financial markets.

Computational finance is a closely related specialization that uses statistical programming language to analyze financial data, estimate statistical models and construct optimized portfolios.

Financial markets

An ideal subject for those interested in the financial/banking sectors, financial markets specializations explore financial institutions and regulation, monetary policy, debt and foreign exchange markets, equity and derivative markets, and international financial architecture.

If you specialize in financial markets, you will learn about theories relating to the role of financial systems and monetary policy formulation, the main regulators of financial markets and their functions, the history and evolution of financial markets, private sector banking, diversification of banking, bond markets and macroeconomic analysis as it applies to financial markets, at national and global levels.

Financial engineering

A similar field to econometrics, financial engineering is a highly technical multidisciplinary field involving the application of computational engineering, software engineering, and computer programming skills along with mathematical and statistical theory to analyze and manage financial opportunities.

Specializing in financial engineering will include learning how fundamental finance theories and models are used in the measurement and management of risk using mathematical and programming tools. You’ll apply economic theory and software and engineering methodologies to analyze and evaluate investment decisions and data, and draw conclusions.

Financial planning

The field of financial planning involves learning about how to achieve financial goals through proper planning and wealth management – for both individuals and organizations of various sizes. Topics could include retirement planning, risk management or employee benefits, as well as learning how to build and maintain client relationships, the factors that can affect financial decision-making, the psychology of money, emotional intelligence and decision theory. Students specializing in financial planning will also need to consider the role of ethical responsibility within the financial planning profession.

These are just a few of the many possible finance topics available at master’s level. Other possible specializations include: behavioral finance, corporate finance, financial mathematics, financial accounting and analysis, professional practice in finance, finance research methods, advanced derivatives, management accounting, asset markets, financial reporting, financial statement analysis, infrastructure finance, mergers and acquisitions, portfolio management methods, private equity, real estate finance, risk management, structured financial products, venture capital... and even more!

Financial careers

At the end of your Masters in Finance, you should have amassed the expertise and finance skills necessary either for PhD research, or for a newly accelerated career in the financial services, banking or management sectors. Among the most popular financial careers you may consider are:

Financial consultancy careers

The term financial consultancy careers is used fairly broadly to describe a wide range of roles all based on providing advice for clients (individuals or companies) in financial matters. This typically involves assessing the client’s financial situation, developing and presenting strategies and solutions, and then monitoring changes and recommending any further steps as required.

As a financial consultant you’ll spend time gathering as much financial information as you can on your client, looking at factors such as investments, asset allocation, savings, tax planning, retirement planning and estate planning. Consultants may work on a freelance basis or be part of a financial consultancy firm or agency.

Related roles include financial analyst, financial advisor, financial planner, stockbroker, financial counselor and retirement counselor. Depending on the field of expertise and country of employment, many of these roles require specific accreditation. For example, in the UK, financial advisors need to take exams for the Certificate in Financial Planning, accredited by the Financial Services Authority.

Quant specialist careers

“Quant” is industry shorthand for “quantitative analyst”. Quant specialist careers are based on analyzing statistics and market trends using high-end mathematics to determine appropriate levels of risk management and derivative pricing. Your primary goal as a quant specialist is to create models which you’ll then present to clients along with your recommendations for future investment decisions.

In order to do this, you’ll need to be able to make an educated speculative guess and perform logical analysis using statistics. You’ll also need to keep abreast of current financial trends and past economic patterns. You’ll spend most of your time under minimal supervision in a white-collar environment such as a bank, hedge fund or investment fund – although there are also increasing opportunities for quant specialists to work remotely.

Many quant specialist careers are available in corporate treasury and finance departments of general manufacturing and service firms, and there is also demand for quant specialists across a wide range of industries – from hospitality and tourism to retail and construction.

Investment banking careers

Investment banks and banks which help individuals or organizations (including private companies and governments) raise capital, manage debts, and manage business ventures such as mergers and acquisitions, privatization and venture capital decisions. Roles in investment banking careers involve analyzing markets and investment opportunities carefully, again in order to provide advice to clients.

Professionals pursuing investment banking careers often spend long hours gathering and interpreting complex data sets, assessing and predicting financial risks and returns, preparing legal documents and liaising with accountants, lawyers and other financial experts. Investment fund managers do a similar job, but usually requiring less hands-on data analysis, focused on making investment decisions.

Audit careers

Auditors are hired by organizations to provide expert advice on the most efficient use of resources, both in the public and private sectors. In many countries all publicly traded and publicly funded bodies are legally required to undergo an annual audit, with requirements for the audit are set down in legislation.

Audit careers involve collecting and analyzing financial details, and forming recommendations for future actions. You’ll then write reports on your findings and may have to create and make presentations to managers and directors. It’s also important to stay informed of any changes in relevant laws and regulations. Specializations within audit careers include tax auditing, environmental auditing or even going abroad to audit in other countries.

Corporate finance careers

Corporate finance deals with the sources of funding and the capital structure (composition of finances) of a corporation. As a professional specializing in this field, you’re likely to be a permanent employee of a business, rather than employed as an external financial consultant. You’ll need to be commercially aware and have a broad set of financial knowledge and skills to bring to the task of increasing the value of your firm through risk management, loss management, resource allocation, capital budgeting, investment analysis and calculating return on investment.

The specifics of corporate finance careers will vary depending on the size of the company and your role within the department, but you could expect to spend time dealing with tasks such as structuring and negotiating deals terms, helping to prepare business plans, issuing shares/bonds and conducting due diligence analysis on business proposals.

Finance officer careers

Also known as finance managers, finance officers are in charge of carrying out various tasks relating to the financial matters of an organization. Finance officer careers involve being responsible for everything from assisting with the monthly budget, preparing monthly financial reports (such as operating costs reports, variance analysis, balance sheets, client statements), controlling and maintaining the nominal ledger, checking payments, carrying out payments, issuing checks, investigating any suspicious account activity, maintaining financial files and records and ensuring security across all financial areas.

Other possible financial careers include: accounting technician, company secretary, corporate treasury management, commodities broker, credit analyst, actuary, financial trader, financial policy maker, financial regulator, loan officer, management consultant, pensions management, financial journalism, public finance accountant, solicitor, stockbroker, retail banker trader, tax advisor or treasurer. Looking slightly further beyond the financial services sector, graduates of a Masters in Finance may also go on to pursue careers in industries such as advertising, human resources, IT, law, marketing, public relations, public policy, real estate and sales.