You are here

Finance

The field of finance covers the economics of claims on resources. For example, money is a claim on goods and services; stocks and bonds and futures contracts are all claims on money or on commodities.

Financial economists study the valuation of these claims, the markets in which they are traded, and their use by individuals, corporations, and the society at large.

At Stanford GSB, finance faculty and doctoral students study a wide spectrum of financial topics, including the pricing and valuation of assets, the behavior of financial markets, and the structure and financial decision-making of firms and financial intermediaries.

Investigation of issues arising in these areas is pursued both through the development of theoretical models and through the empirical testing of those models. The PhD Program is designed to give students a good understanding of the methods used in theoretical modeling and empirical testing.

Preparation and Qualifications

All students are required to have, or to obtain during their first year, mathematical skills at the level of one year of calculus and one course each in linear algebra and matrix theory, theory of probability, and statistical inference.

Students are expected to have adequate programming skills using languages such as Fortran, C, MATLAB, or GAUSS, or to correct any deficiencies before enrolling at Stanford.

The PhD Program in finance involves a great deal of very hard work, and there is keen competition for admission. For both these reasons, the faculty is selective in offering admission. Prospective applicants must have an aptitude for quantitative work and be at ease in handling formal models. A strong background in economics and college-level mathematics is desirable.

It is particularly important to realize that a PhD in finance is not a higher-level MBA, but an advanced, academically oriented degree in financial economics, with a reflective and analytical, rather than operational, viewpoint.

Recent Journal Articles in Finance

Shai Bernstein, Xavier Giroud, Richard R. Townsend
Journal of Finance. August
2016, Vol. 71, Issue 4, Pages 1591-1622
Bryan T. Kelly, Hanno Lustig, Stijn Van Nieuwerburgh
American Economic Review . June
2016, Vol. 1106, Issue 6, Pages 1278-1319
Timothy James McQuade, Stephen W. Salant, Jason Winfree
Journal of International Economics. May
2016, Vol. 100, Pages 112-119

Recent Insights by Stanford Business

July 25, 2016
New research questions whether “smart” beta is always smart.
Illustration of a man moving a life-sized rook on a chess board | iStock/JDawnInk
June 28, 2016
Confident that help was pending, financial-sector investors had less incentive to buy protective options.
A man overlooks an emblem for the U.S. Federal Reserve System | Reuters/Kevin Lamarque
June 17, 2016
Banks are not alone when it comes to being overleveraged.
Professors Paul Pfleiderer, Anat R. Admati, and Peter M. DeMarzo | Drew Kelly