The MBA in Sales & Trading

Generally, sales and trading is a much less hierarchical work environment than investment banking. For this reason, it is widely believed that you don't need an MBA to get promoted on sales and trading desks. This view is often perpetuated be people who work on trading desks, but just because you hear this once or twice, don't accept it as truth. Whether you need an MBA or not is really a function of the firm you work for and the desk you're on. If the firm you're considering hires both associates and analysts, but you notice that associates are offered twice as much pay as analysts, then this is certainly an indication that MBAs are more highly valued. This doesn't mean that you can't be promoted without an MBA; you'll just have to work much harder to get recognized. When it's time for a promotion, you may also be somewhat behind in the pecking order. Some firms, on the other hand, don't want MBAs. This may be because they don't want to pay more for employees with business degrees, or because they have an implicit firm policy regarding MBA -- some firms hold the view that it's hard to teach an old dog new tricks, so they will hire exclusively out of undergraduate programs.

Not only is the MBA valued differently from firm to firm, but it is also valued differently from desk to desk. A lot about being on a trading desk is about fitting in, and if everyone else, including the boss, doesn't have an MBA, then chances are that having an MBA won't add too much value in this environment. In fact, an MBA degree may even hurt your career prospects if there's a downright disdain for MBA types. Alternatively, if the desk you're on is populated with MBAs, then not having an MBA will probably limit your career advancement. Alternatively, you can be in a situation where you're the only MBA and everyone thinks that you're the brain, which can work to your advantage even if the boss has no personal biases about the value of the degree.

The bottom line is that there are no hard and fast rules. Depending on the particular firm and desk, an MBA may not advance your career. Be aware of the aforementioned issues, and ask some good questions to get a better feel for whether an extra degree is a benefit.

What are some of the tangible benefits of an MBA?

The pay is better and you will generally have a faster track for promotion to salesperson or trader. The MBA associate will typically have to do the same demeaning things that an undergraduate analyst does, but mercifully for a shorter period of time. In some cases, MBAs are also more likely to be assigned the desk that they'd like to work for. Undergraduate sales and trading recruiting programs, on the other hand, may hire you as part of a generalist pool and place you on a desk that isn't your top choice. Another benefit for the MBA candidate is the availability of more exit options out of sales and trading.