Master of Financial Economics
| Essay 1: In 250-500 words please describe your educational goals and those academic and/or professional achievements which have contributed most to your development. |
| My educational goal is pursuing a PhD in Finance research. To fulfill my goal, I have already developed my profile in different ways. During my undergraduate studies at the University of Alberta Business School, I have developed a solid background in finance and acquired strong analytical skills. I ranked first in at least 9 out of 18 courses in the 3rd and 4th years of my undergraduate modules, including the most challenging ones such as Risk Management, Portfolio Management, Capital Budgeting, Fixed Income, and Statistics. Due to my excellent performance, I was awarded six merit-based scholarships, totalling CAD 18,600.
In addition to that, I sought to go further than what was taught in class and thus sought experience in finance research. I was the first undergraduate over the past three years at the University of Alberta to write a finance honours thesis. My honour thesis research project was in empirical asset pricing, specifically on the relationship between market volatility and the five risk premia from the Fama-French (2015) five-factor asset pricing model. I used the concepts of Granger causality to determine the direction of causality between VIX and different market risk premia and showed that that percentage change in VIX had a positive relationship with HML (value spread), RMW (profitability spread) and CMA (investment spread), indicating a flight to value, profitability and conservative investments during volatile times. Furthermore, I implemented a two-way sort of the firms I studied along with the growth/value and large/small-size categories to better study the relative movements of their risk premia. I found that holding the size constant, HML is more positively related to the change in VIX in small firms, while RMW and CMA’s move is more prominently positive related to change in VIX among big firms. Don't use plagiarized sources. Get Your Custom Essay on
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I have also gained knowledge in practical finance by undertaking internships in different parts of the finance industry. During my internship in Huatai Securities, I learned the Chinese bond market had been mainly for safe grade-AAA bonds only, but only a mature junk bond market will breed more small businesses and keep the market of leverage buyout running, which in turn helps improve the efficiency of the whole financial market. During my internship at the risk-management division of Bank Sinopac, I worked on adaptations to abolishing the LIBOR system. There, I learned how a lack of timely regulatory instructions caused significant uncertainty; the monolithic regulatory governance caused banks’ inertia and unwillingness to innovate. This inertia and unwillingness are also a typical Nash Equilibrium situation; if there are no benefits for banks from innovation, all players will sit in the sub-optional point of no innovation. As a result, the financial system will not be as developed as other countries, and the Schumpeter circular flow may not be running as efficiently as they would in a competing and developed financial system, just like King et al. (1993) argued. Reference: King, R. G., & Levine, R. (1993). Finance, entrepreneurship and growth. Journal of Monetary Economics, 32(3), 513-542. |
| Essay 2: In 250-500 words please indicate your expected career track (examples include, but are not limited to, consulting, banking, asset management, research and modeling, risk management, etc.) and describe how the Master of Science in Financial Economics will help you attain your career goals. Please be specific. |
In the short term, I intend to develop my skills in finance research by pursuing a Ph.D. My research interest focuses on explaining the Idiosyncratic Volatility puzzle using different proxies of idiosyncratic risk and with ideas borrowed from Behavioral Finance. At the same time, I am looking forward to applying the research accomplishment into the industry to make a real-world impact by closely working with regulators and policymakers. I am particularly interested in promoting innovation in the junk bond market in a less developed economy while helping the regulatory policymakers to incorporate the side effect in the economy with the less advanced financial system. Thus, I want to take part in The Program for Financial Studies, particularly on Risk Management initiatives, where I will have access to the data resource and the precious opportunity of connecting with both the brilliant faculty in the of research and partitioners in the front-line.
However, I need more quantitative training in research mythologies to fulfill my short-term goal of pursuing a Ph.D. Thus, I am particularly interested in the rigorous curriculum offered in this Master of Science in Financial Economics program. I will accumulate more quantitative knowledge and essential programming skills in modules like Empirical Asset Pricing and Computing for Business Research.
Furthermore, I have gained much from working with an advisor in my undergraduate. Thus, I am eager to work with the outstanding faculty in Columbia on a research thesis, which will prepare me better for a different career in finance research. In particular, I am incredibly interested in Professor Geert Bekaert’s risk in empirical asset pricing. I am looking to expand my previous research on relationships between market risk and systematic risk premia by borrowing the idea of decomposing the risk-neutral expected stock market variance (Bekaert &Hoerova, 1993).
After completing the Ph.D. program, I will strive to secure a faculty position in North America or China for my long-term career goal. In addition to that, I plan to establish a not-for-profit organization that would provide a platform for the scholars and practitioners in finance and other related fields, particularly for the Ph.D. candidates in the less-developed countries, so that they can maximize their potential and value in the earlier stages of their career while getting extra funding.
Given my rigorous undergraduate experience, skill in working with real-world data, and significant research experience, I believe that I will be an excellent candidate for the Master of Science in Financial Economics
in Finance at the University of Columbia. I most sincerely hope to be given a chance to excel and hope that the program would lead to a promising pathway as a finance researcher in th
