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So, which major has the highest chance of getting you into investment banking?You might think that only undergraduates have to think about that one, but it comes up even when you’re that beyond that stage: when you go for Master’s or MBA degrees, you need to pick a concentration or major.
You shouldn’t pick classes just to get into the industry – but you also need to make sure you’re not reducing your chances of getting in by picking the “wrong” major.
You need to consider 5 factors when picking a major:
- Enjoyment – Even if you pick something “easy” like Art History, it’s tough to get through it if you’re not at least somewhat interested.
- Your GPA – Quantum Physics might sound cool, but not if you get a 2.0 as a result.
- Time Requirements – You also don’t want to spend all your waking hours at the lab, because that reduces networking and activity time.
- Your Story – Will your major support the “story” you tell interviewers? Or will it be as illogical as The Joker?
- How Bankers View It – They may not know the specifics behind every single major, but they view some as “easy” and some as “hard.”
It gets complicated to weigh all these factors at the undergraduate level.
But it’s easy to do that at the MBA and Master’s levels, so let’s start there.
You won’t have a “major,” but you can usually pick a concentration or focus with your classes.
GPA is irrelevant because many top schools don’t even award grades – and while some classes may be more difficult than others, the perceived and actual differences are smaller.
So this decision is simple: pick a concentration that supports your story.
If you did sales & trading, got tired of it, and now want to move into corporate finance it won’t seem logical if you pick algorithmic trading classes.
But if you worked in banking and now want to move into venture capital, then “Entrepreneurial Finance” classes would make sense.
You applied to a Master’s program to take another shot at recruiting and to gain some prestige if you went to a lesser-known university.
So you only have one choice: do a Master’s program in Finance.
It makes absolutely no sense to go through the trouble if you’re going to spend your time analysing English literature.
Related areas like Accounting, Management, and so on can work but Finance is the safest bet and the best way to support your “story.”
Now we get to the fun part.
The choice of a major at the undergraduate level is more difficult because you actually need to take into account all 5 factors – enjoyment, GPA, time requirements, your story, and how bankers view it.
Rather than doing a SWOT analysis here (I’ll leave that to the consultants in the room), I would summarize it like this:
Pick a major that you’re at least somewhat interested in, where you can get a decent GPA (> 3.5 in the US system or equivalent abroad), have time for at least 1 major activity outside school, and that supports your story.
Ideally, we would all pick something that matches our interests precisely: video game design, the history of sports, or physical therapy.
But bankers won’t take you seriously if you have a major like this on your resume / CV.
So you have to compromise – one option is to do a more serious major and then pick something “fun” for your minor.
GPA and “Easy” vs. “Hard” Majors
Since bankers only spend 30 seconds looking at your resume, they have a simple classification system for majors:
- Liberal Arts / “Creative” Majors – Easy
- Economics / Finance / Some Sciences – Medium
- Engineering / Physics / maths – Hard
Before you reply or leave an angry comment, remember that these are not my own personal views – this is simply how bankers in a rush for time view the relative difficulty of majors.
Bankers expect you to have a lower GPA if you did a “hard” major and a higher GPA if you didn’t.
You still can’t waltz in with a 2.5 and expect to get interviews, but a 3.3 or 3.4 GPA doesn’t look as bad if you had a difficult major like Chemical Engineering.
Go for one of the “medium” difficulty majors – that way you can get a decent GPA and have time for activities outside of school.
Time for Activities
Once you’re out of school, activities don’t matter – but as a student you don’t have full-time work experience, so you need to rely on being “interesting.”
You can substitute internships, studying abroad, sports, ornetworking in for “activities” here.
Regardless of how you spend your time, you need to be able to talk about something outside of school work and summer internships.
If you’ve picked a more difficult major and really have no time, try to clear one semester or one quarter and use a study abroad experience as your “interesting fact.”
Similar to the “Why investment banking?” question, there are 2 story categories:
- Non-business/finance major moving into business.
- Business/finance major moving into investment banking specifically.
So your major has to support whatever you’re saying here.
For #1, your major should be either your starting point (“I was interested in biology, but then got interested in finance…”) or your growing interest(“While in the biology major, I got exposed to finance in this one class / internship…”).
Some Examples, Please…
I knew you’d ask, so let’s go through them.
Example #1 – The Biology Major: She picks Biology (not “easy” but not as difficult as other choices), gets a 3.6 GPA, and has time to lead a volunteer group outside of work.
She does a lab internship her first year but then moves into business development at a biotech company, gets more interested in finance and does a couple related classes – and she gets into banking to advise biotech companies in the future.
Example #2 – The Accounting Major: He goes to a state school, majors in Accounting, gets a 3.7 GPA, and has time to be on his school’s Track & Field team. He did an internship at a Big 4 firm, got some exposure to Transaction Advisory Services, and now wants to move into banking.
While he learned a lot at the Big 4 firm, he wants to have a more direct role in shaping transactions and knows he can leverage his Accounting background to hit the ground running in banking.
Finance vs. Non-Finance Majors
You might now say, “Wait a minute – isn’t it always to your advantage to pick something like Economics/Accounting/Finance so you can tell a story around it and get decent grades?”
You can’t really go wrong with one of those choices, so if you have no other preferences then it’s a good idea.
Especially if you go to a lesser-known school, it’s in your best interest to pick a finance-related major because you have to work really, really hard to prove your interest.
At “target” schools you have more flexibility, because bankers assume you can handle anything.
One special case occurs when your school is well-known in a specific field.
The classic example is MIT – if you go there and major in Political Science, that would raise eyebrows no matter how accomplished you are. You’re better off picking something technical that plays to the school’s strengths.
At a place like Wharton, specific classes may be important in the context of networking – hundreds of alumni have been through the same courses and you can “bond” over the experience.
Are There Any Classes You Definitely Need?
Super-advanced maths classes are not helpful, so forget about those.
If I had to pick 1 absolutely essential class, it would be Accounting.
When you start working, you don’t want to be figuring out what an income statement is – you should be familiar with all the lingo and know how the statements link together.
If your school actually offers modelling or valuation classes, those would be helpful as well – but not as essential as accounting.
What If You’ve Picked the Wrong Major?
There’s a decent chance you’ve already picked a major and completed a good portion of it – so what do you do if it’s the wrong one?
If you’ve picked something that’s too easy, the best way to fix it is to add finance-related classes and turn them into a minor.
If you’ve chosen something that’s too difficult, take the path of least resistance and do the bare minimum needed to finish it.
Adding in finance classes in this case would not be a smart move, because you’re already overworked – you’re better off showing your interest through internships or activities.
Your major itself doesn’t matter.
It’s more about your major in the context of everything else: your GPA, your “story,” your internships, and your activities.
So make sure yours fits in with those and tells a good story – and if you really can’t decide, just pick Finance like everyone else.