Thursday, March 24, 2011

Non-clinical jobs and financial analysis

As we begin discussion of Dr. Kim’s second category-venture capital, finance, Wall Street-let’s get a quick intro into the category. This is an industry that has got lots of press over the last 5 years. I imagine that prior to 2008 everyone would love to have the credentials to work in the financial analysis arena. Although the market crash has obviously changed the perception of Wall Street, there is still great interest in combining medicine and finance. One of the most obvious ways to take advantage of your medical knowledge is to evaluate medical-related companies. Doing financial analysis is not an easy task, and, depending on your role and where you work, millions to billions of dollars could be riding on your opinion. It can also be exceedingly exciting, especially in the world of venture capital. Finding and financing a company that goes on to great success can be thrilling and, in the case of medical companies, can lead to great social good as well.

Dr. Kim also brings up the important question of whether to pursue and MBA. He provides a great opinion of someone “in the know” so the only thing I would add is to reinforce one of his points. Although you can get an MBA at a great number of schools, networking in the business world can open many doors. To that end, completing your MBA at the most prestigious place possible to make those connections will go a long way to advancing your career in the financial world. There are also different types of MBA’s-traditional, executive, part-time-that you need to be aware of. Each of these has a different student population, so you need to do some research to determine which will help you best connect with professionals that will help with your career goals.

With that being said let’s talk about the second category-financial analysis. A great book in this field is The Big Short: Inside the Doomsday Machine by Michael Lewis. The book takes you through the sub-prime mortgage from before it was a household term. He highlights some investors who profited handsomely from the fall while throwing in some interesting characters. Michael Lewis is a respected author who has tackled big, ground breaking topics before-baseball fans will remember Moneyball: The Art of Winning an Unfair Game and prior to that he had a huge hit with Liar's Poker. These books are well-researched and shed great light into an emerging trend that he set. In the case of Moneyball, the Oakland Athletics front-office was the most emulated after his expose, some would even credit it with the popularity of sabremetrics and the rise of the Red Sox and Theo Epstein.

So knowing that Lewis is a great researcher is what makes this a great book on determining your interest in financial analysis. Although this book is not specifically what financial analysts do, there is a great amount of technical jargon that must be understood to get through the book. His writing style is well-formed allowing you to focus on the minutiae, but minutiae it is. A quick survey of Amazon reviews will reinforce that notion-it’s great writing, but it is technical. Bottom line-if you can get through this book with a high-level of understanding you have the fortitude do complex financial analysis on medically related companies.

Another great book is Freakonomics and its follow-up Superfreakonomics. These books take an in-depth look at the financial realities of “common knowledge.” One colloquialism is that drug dealers make a lot of money, broken by a graduate student Sudhir Venkatesh. As part of his program he went to poor urban communities to administer surveys. While performing this mundane task at a housing project he encountered a drug dealer who actually held an MBA and was running a drug empire. The dealer used his MBA knowledge to keep meticulous details on his operation, which he allowed Venkatesh to evaluate. Venkatesh found that most low level drug dealers make very little, often less than if they worked at McDonalds-and that at significant risk to bodily harm. The book is filled with these types of stories, and I found it to be an easy read, however I am a big fan of behavioral economics.

Some other books that dive into this field include Intelligent Investor (or any other book about investing) or any of the books in the Kiyosaki series, the most famous of which is Rich Dad, Poor Dad. If you have any other suggestions for financial books, I would love to hear them!

About the author

Mehul Sheth is a Board Certified Pediatrician who works for Allscripts, a leading Health IT company. He has designed and delivered social media strategies for varied medical organizations. He is also an award-winning clinical teacher and holds positions for both local and national AAP committees as well as a career coach. He loves spending his free time with his wife and three kids. He can be found on LinkedIn and Twitter.

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