Finance is the science that describes the management of five interrelated fields: money, banking, investments, credit and assets. All of finance can be described in terms of money, time and risk. Money is anything that can be exchanged for an item or service of equivalent value under a given system of law. Time is the measurement of events and their duration. Within the context of finance, risk is the probability that a debt will not be repaid and the probability that an investment will drop in value or be lost.
These three concepts define the discipline of finance and give it focus. Financiers are engaged in the practice of managing and growing money, whether that is the form of bank deposits, investments in various markets, or loans. Financiers gain their educational experience through undergraduate and graduate programs before applying it to the real world through such industries as investment banking, portfolio management, investing, venture capitalism, or many other fields and subfields that offer opportunities to financial experts.
Different Fields to Choose From
For those interested in finance who want something beyond a career, there is always the Doctor of Philosophy in Finance program. These elusive creatures can be found online and offline and provide an opportunity for students to ascend to the highest level in their chosen field.
In actuality, there is no such thing as a PhD in Finance; the degree program is actually a PhD in Management with a concentration in Finance. Such a degree is available to students who are prepared to go to extraordinary lengths in order to understand finance at the highest conceptual levels currently available.
This road is an exciting field that usually leads to a student becoming a professor in the economics or business department of a major university. They usually continue their research while taking up teaching duties or occasionally engaging in conferences with other bankers, investors, etc.
This article will examine PhD programs that offer concentrations in finance and provide the student with the information they need in order to succeed both in their chosen program and afterwards.
What Students Can Expect To Learn
In order to understand what actually awaits the student, they have to understand the nature of the PhD program in general.
First, it is the highest academic degree awarded; there is literally nothing left for the student of finance to achieve after earning a PhD degree. It is important to realize that there is a difference between the PhD and the doctorate. A PhD is a degree in a specific field, but some doctoral programs are recognized as providing cross-disciplinary value. For example, the Doctor of Juridical Science is considered equivalent to a PhD in law by some entities in the legal field.
Second, the PhD program is highly research-oriented. PhD students are expected to conduct their own research both for themselves in their dissertations and lead their classes through research papers. The overall structure of the typical PhD program is built around three phases of their work.
The Typical Program
The first phase is pure coursework within the student’s field of study. This coursework involves both reviewing the basics in a more detailed way as well as incorporating new concepts and skills into their existing understanding.
These courses are sometimes called “foundational courses” because they are meant to prepare the student for the rigorous work that comes afterward. Typical courses include classes in econometrics, which is applied statistics with an eye towards economic concepts and principles, microeconomics, linear algebra, probability and statistics courses, as well as classes in basic financial theory and concepts. This section of the program can take anywhere from one to three years.
The second phase involves students investigating the current state of their field through exploration of research and practical published works in small groups called “seminars”. These seminars are the heart and soul of the doctoral program. They are characterized by being much more self-directed than an ordinary class.
The seminar consists of going through published journal articles, both theoretical and practical journals, and exploring the nature of finance even deeper. The goal of the seminar is to educate the student in the method of self-teaching. It does this by having the students present the papers each class. A usual three-hour class over the course of a week will typically go through three to eight articles, depending on the professor.
Theoretical papers will have a lot of mathematics in them such as calculus, linear algebra, differential equations and real analysis. Practical papers will also have plenty of mathematics, but the focus will be on statistical analysis instead of on purely abstract applications. The seminars prepare the students for the third and final phase of the PhD program: the dissertation.
What to Expect During the Dissertation Process
The average doctoral dissertation in finance programs runs between sixty-five and one hundred and fifty pages. The entire point and focus of the dissertation is for the finance student to conduct an original piece of research, present it before a student-selected committee and defend their conclusions before that same committee.
The dissertation is built around a research question that must be cleared with the committee chairman before the student starts writing. The dissertation will likely be the most exhausting piece of research the student ever completes in their professional lifetime.
At the end of the program, if all goes well, they are awarded a Doctor of Philosophy degree. The total amount of time required to earn a doctoral degree is four to five years, although it can take up to ten.
Online Schools That Offer Finance PhD Programs
Walden University is one of the few schools that offers an online PhD finance program in the country. Their program in applied management and decision sciences lets the student design their own PhD program that can incorporate their previous skills and research interests. The program helps the student gain a deep understanding of financial theory, systems and practices while maintaining the focus on management.
Walden also offers a PhD in business administration with a concentration in finance. Again, this program is one of the few distance learning programs in the country that offers a concentration in finance. This program offers advanced understanding in such things as derivatives, options pricing, hedging, capital budgeting and structure, working capital management and valuation.
Walden University is located at 155 5th Avenue South, Minneapolis, MN 55401-2511 and at www.waldenu.edu.
North Central University
North Central University also offers a robust Doctor of Business Administration program with a concentration in Financial Management as well as a Doctor of Philosophy in Business Administration with a concentration in Financial Management. These two programs will train students in the notions and concepts behind financial management, such as the analysis of both financial and non-financial organizations, studying advanced concepts of asset allocation and accounting principles.
North Central University is located at 910 Elliot Ave. Minneapolis, Minnesota, 55404 and at www.northcentral.edu.
Offline Schools That Offer PhD Finance Programs
There is a plethora of PhD finance programs available to prospective students. Some of the most prestigious and famous are located within the well-known Ivy League conference of schools, such as the University of Pennsylvania’s Wharton School of Business’s Doctor of Finance Program. The University of Pennsylvania is located at 3451 Walnut Street, Philadelphia, PA 19104-6243 and online at www.upenn.edu.
The best-ranked PhD finance programs are usually the Wharton School, Harvard Business School and London Business School. Harvard University is located at Massachusetts Hall, Cambridge, MA 02138 and online at www.harvard.edu. The London Business School is located at Regent’s Park, London NW1 4SA, United Kingdom and online at www.london.edu.
Job Opportunities For Graduates of PhD Finance Programs
There are a wide variety of job opportunities open to graduates with a PhD in finance. Aside from the usual job availability of teaching or research positions, the PhD offers graduates the ability to join high-quality professional management teams as well as manage endowments, portfolios of investment firm clients and other opportunities such as founding their own investment group or becoming an international financier.
Depending on the specific title, PhD graduates may find themselves with anywhere from $80,000 to $120,000 per year as a starting salary. As they gain experience, they will find that their salaries can keep going up, sometimes to as much as $140,000 or even $160,000 per year.
PhD graduates can find work in the stock market, bond market, derivatives and commodities markets as a financial analyst, in the insurance industry as a claims adjuster or as a high-ranking loan officer or even the head of the loan officer department at a bank. These positions all bring prestige and high salary bonuses with them, which is great compensation and reward for several years of hard work.
According to the Bureau of Labor Statistics, the job market for this field is expected to grow significantly over the next eight years. This will create many opportunities for graduates to find work and establish themselves as experts in their respective fields, enabling them to lead their profession and the national and global economy on an upward path.
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