1 investment banking job interview questions and answers
Book Prospectus and Outline
 

Heard on the Street:
Quantitative Questions from
Wall Street Job Interviews

Timothy Falcon Crack, PhD (MIT)


The Book
 
  1. Brief description

    The book contains job interview questions collected from actual Wall Street job interviews. The majority of the book deals with quantitative questions; a smaller section deals with qualitative questions. The quantitative questions are accompanied by very detailed solutions and advice. The 14th Edition contains a section on interview technique. This is a general trade book, not a text book.

    The book was written because my MBA students were constantly pestering me for study materials to prepare for the unique nature of their job interviews (investment banking, investment management, sales and trading, research analyst, financial engineering, ...). The interviews (like the profession itself) are stressful, high-pressured, and confrontational. Interviewers routinely present interviewees with difficult quantitative problems to be solved on the spot. The problems serve to screen out applicants who lack quantitative critical thinking skills or who behave poorly under pressure.

  2. Outstanding features

    I found 33 "interview books" at my local book store. Most of these books present questions you might expect at a job interview, and advice on answering them. There is ZERO overlap between these 33 volumes taken together, and the quantitative questions and answers in my book. Not a single one of the quantitative interview questions in my book appears in any of these 33 volumes. In fact, these interview books go so far as to misrepresent the interview process as a civilized and polite - perhaps even kind - experience. Any MBA student who buys and reads all 33 of the books I looked at may be in for one hell of a shock at a Wall Street interview if they have not seen my book.

    Another feature is that these questions relate to important topics that are often excluded from regular MBA curricula. There are two reasons for using such questions: firstly, it increases the pressure in the interview (and serves to screen out those who cannot handle pressure); and secondly, the questions can be answered only by the more talented interviewees (thereby screening out the dummies). The bottom line is that MBA students who study my book are effectively taking a course with me where I fill in many gaps in their MBA education.

  3. Pedagogical features

    The quantitative questions are accompanied by detailed solutions and advice. My advice is based on (amongst other things) four years experience as a front line teaching assistant in MBA finance courses at the Sloan School at MIT. Appendices contain background theory, computer programs for hand-held calculators, and references for further reading.

  4. Supplements

    There is no manual or study guide, because the book is by its very nature a study guide.

  5. Level

    The main audience is finance MBA students seeking investment banking and investment management jobs. Secondary audiences include advanced finance undergrads or finance doctoral students. Another audience is the interviewers themselves who can call upon the book for questions.

    In the classroom, the book is unique in that it gives professors a chance to present advanced - and sometimes very theoretical - material without the students losing interest. As soon as a student hears the magic phrase "actual job interview question," the professor no longer has to justify presenting something that might otherwise be regarded as too advanced.

  6. Has the material been class-tested?

    Yes. The material makes regular appearances in my own courses (to the appreciative amazement of my students). It has also being used by Olivier Ledoit at UCLA, and other professors in Europe and the US. It has proved very successful.

  7. Author's Background

    I have a PhD from MIT. I have papers published (or forthcoming) in the Journal of Finance, The Journal of Business, The Financial Analysts Journal, The Journal of Futures Markets, The Journal of Applied Finance, and the Journal of Financial Education. I have won six teaching awards and been nominated for five others. My most recent practitioner position is as head of a quantitative active equity research group in London. I am now a finance professor in New Zealand. My web-based CV.

  8. The Competition

    Several competing books now exist (as of 2014). No other book has been in print for as long as HOTS and been revised so many times to incorporate feedback from 100s of candidates interviewing for jobs, and from 100s of interviewers. Also, the content of my book spans anywhere from advanced undergraduate corporate finance banking interviews right up to highly technical PhD-level quant interviews. No competing book has that breadth of coverage; they either focus on mildly quant questions from corpfin banking interviews, or highly technical questions from nothing-but-quant interviews. My book spans both markets and everything inbetween.

  9. The Market

The Outline
Chapters:

Introduction
Overview of contents, Warnings and advice (your interview, questions in this book, other reading, other advice). Interview technique.

1 Purely Quantitative and Logic Questions
finance interview questions on all topics imaginable - except finance!

2 Derivatives Questions
questions covering: options, futures, forwards, swaps, stochastic calculus, Monte- Carlo, and everything you ever wanted to know about Black Scholes pricing.

3 Other Financial Economics Questions
finance questions covering: bonds, term structure, games of chance, CAPM, GARCH, Brady Bonds, and hedging.

4 Statistics Questions
statistics questions.

5 Non-Quantitative Questions
questions covering: you, your job awareness, the markets and the economy, financial management, and quirky thinking questions.

Appendices:
A Purely Quantitative and Logic Answers
B Derivatives Answers
C Other Financial Economics Answers
D Statistics Answers
E Non-Quantitative Answers (Selected)
References (approx 200 articles cited in the text)

Index
A full index covering approx 900 items.


Additional Information
 
  1. Sample Chapters
    Not available.
  2. Schedule of completion
    The full manuscript is complete. It has been proofread and copyedited by a professional editor. The book is for sale on most online book stores and can be ordered through Ingram in the US and Bertrams in the UK.
  3. Length of work?
    Approx 100,000 words. This is approx 270 pages single spaced using LATEX document preparation system and "book" document style, 11pt font.
  4. Art program
    There are about 18 figures. These have already been prepared in postscript format and are included in the document at the appropriate locations.
  5. Word processing equipment
    The LATEX document preparation system is being used. Postscript graphics files are imported into the LATEX document automatically. LATEX can output postscript files for printing.
  6. Qualified Reviewers
    Any capital markets (investments, derivatives, equity/fixed income, ...) professor at a North American university. Any investment banking or investment management employee at a respected US institution.

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Last Updated: February 6, 2014