Finance

The field of finance covers the economics of claims on resources. 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

Markus Brunnermeier, Arvind Krishnamurthy
The Review of Corporate Finance Studies. November
2020, Vol. 9, Issue 3, Pages 656-665
Peter A.E. Koudijs, Laura Salisbury
Journal of Financial Economics. October
2020, Vol. 138, Issue 1, Pages 1–26
Priyank Gandhi, Hanno Lustig, Alberto Plazzi
The Review of Financial Studies. September
2020, Vol. 33, Issue 9, Pages 4231–4271

Recent Insights by Stanford Business

November 23, 2020
The U.S. Treasury market came close to a meltdown in March, revealing a rickety system that threatens “national economic security,” a Stanford professor says.
Signage is seen at the United States Department of the Treasury headquarters in Washington, D.C., U.S., August 29, 2020. Credit:REUTERS/Andrew Kelly
October 8, 2020
Friedman’s credo that corporations should focus only on maximizing shareholder value rests on assumptions that are “far from true in the real world.”
An illustration of a hand manipulating justice. Credit: Reuters/erhui1979
August 27, 2020
A forensic analysis reveals that Chinese banks deployed credit cards as a form of “disguised corruption.”
An illustration of a man’s suit with a credit card sticking out of the breast pocket. Credit: Tricia Seibold and iStock/youngID