Archive for the ‘Education’ Category

Understanding SEC’s Money Market Reform Proposal (Release 33-9408)

Monday, July 1st, 2013

A money market fund’s purpose is to provide investors with low risk/low return, easily accessible cash-equivalent assets.The fund holds an objective of maintaining a NAV (net asset value) of $1 per share. MMF portfolios are comprised of short-term securities representing “high quality, liquid debt and monetary instruments”.

Totaling approximately $2.6 trillion in assets, corporations often heavily rely on the funds as a source of short-term financing in their day to day business. MMFs drew initial interest from the SEC when the oldest money fund – and one of the biggest – the Reserve Primary Fund, dropped 3% in 2008 causing investors to panic. In the days following this decline the fund experienced investor withdrawals of over $300 billion. Bringing the short-term credit market to a halt, corporations were stymied in their efforts to pay critical expenses such as payroll, etc.

Since this panic, the SEC has been pressed to reform the rules under which these funds operate (despite ire from the mutual fund industry).

Intent on mitigating the financial system from economic shocks, the SEC released a milestone marking proposal detailing new rules for the industry.

The release outlining the reform puts forth two proposals. The first proposal calls to institute a floating NAV policy allowing MMF shares to fluctuate on prime institutional funds thus removing the special exemptions that used to allow MMFs to use amortized-cost accounting and rounding to maintain stable NAVs. By floating NAVs, funds are able to destigmatize changes in fund value and train investors to understand fluctuations. (It should be noted that retail and governments MMFs are not to be affected)

The second proposal is to limit redemptions or charge fees for full redemptions on MMF holdings. This proposal is designed to mitigate MMF’s susceptibility to heavy redemption during panic, improve MMF’s ability to manage and mitigate potential contagion from high levels of redemption, preserve maximum benefits of MMFs for investors and increase the transparency of risk in these funds.

Even with floating NAVs, volatility is expected to be minimal, yet it is still to be understood how these reforms could affect the industry. Comments have been made suggesting complications with overnight sweep accounts, gains/losses reporting in switchover from fixed NAVs, etc.

It is important to note that this is in fact just a proposal and is yet to be heavily weighed in upon by the money fund industry. Critics worry reform could press more investors to pull out of the market as it has already experienced a $1.3 trillion dollar decline since 2008. SEC commissioners will most likely vote on the proposal later this year.

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Occupy Main Street, Restructure America

Sunday, November 6th, 2011

November 6, 2011: It has been almost 4 years since the United States and the entire Western World has been mired in this recessionary state. What has happened should not be a surprise to anyone. After scrambling for an ever higher quality of life, sending labor-intensive industries overseas, and losing more than 2.5 million manufacturing jobs and more than 850,000 professional service and information sector jobs to outsourcing, we foolishly blame our government and the top 1% of our earning population for our hardships. Most Americans lack the skills and motivation to innovate, and are fit to work only in commoditized industries, yet most of our commoditized industries have been sent overseas. The government has unsuccessfully spent trillions on the economy to lessen market volatility, to reassure pensioners, to bolster bank and corporate balance sheets, and to create jobs. Over the past 10 years, spending growth for prisons has risen at a rate 6x the rate of spending on education because this society simply does not value education as much as it should. The truth of the matter is, we are all to blame. After inflating real estate and securities prices through leverage, after fighting senseless wars in pursuit of oil when we have enough natural gas reserves to last 200 years, and after allowing an entire generation of our citizens to lose their values of hard work and integrity, we ALL are to blame.

Instead of pushing our children to embrace globalization, we have allowed them to grow up isolated from the rest of the world. Instead of encouraging them to be productive and to earn their own keep from a young age, we have allowed them to spend hours watching brainless television and to lose themselves in drugs and alcoholism in communities where families aren’t the norm and divorce rates are greater than 70%. Instead of building secure homes, we have a bred a completely confused generation just asking to be taken advantage of by the rest of the world.

We need to OCCUPY MAIN ST.; we need to restructure America, the American lifestyle, and the American mind before it’s too late. We need to instill passion for innovation and entrepreneurship, we need to teach our children practical skills and make sure that they are proficient in math and science, we need to encourage competition, and we need to instill the values of hard work and integrity into our youth so they can grow up to be proud and self-sufficient.  No able bodied person should feel entitled to anything material in life without providing value or giving back to society.

Today, there are 45 million Americans on food stamps.



The number of very poor Americans (those at less than 50% of the official poverty level) has risen to 6.7%, or to 20.5 million.  This is the highest percentage of the population since 1993.  At least 2.2 million more Americans, a 30% rise since 2000, live in neighborhoods where the poverty rate is 40% or higher. Last year, 2.6 million more Americans descended into poverty, which was the largest increase since 1959.  In 2000, 11.3% of all Americans were living in poverty; today 15.1% of Americans are living in poverty. The poverty rate for children living in the U.S. has increased to 22%. There are 314 counties in the U.S. where at least 30% of the children are facing food insecurity. More than 20 million U.S. children rely on school meal programs to keep from going hungry. In 2010, 42% of all single mothers in the U.S. were on food stamps. More than 50 million Americans are now on Medicaid. One out of every six Americans is enrolled in at least one government anti-poverty program. I agree that we should help the poor and that compassion is a virtue, but shouldn’t these people help themselves as well? What specifically has caused their plight? Is only the government to blame? Are only the rich to blame? No, of course not.


Inflation adjusted wages have not grown since 1999, the S&P 500 is at 1998 levels, and real estate prices are at 2002 levels.  It is up to us to realize what caused the “lost decade” and avoid a “lost century.”

Why has this happened? By the 1970s, the average American was 20x richer than the average Chinese person. Today, it is only 5x. The Western world rose to power because “they had laws and rules invented by reason.” Our institutions, our basic freedoms and property rights, our discipline, and our motivation to work hard created $130 trillion of wealth in the Western World. Unfortunately, we have lost our work ethic and our intellectual drive. The average Korean works 1,000 hours more per year than the average German. The Chinese soon will have filed more intellectual property patents than the Germans. This is the END of the great divergence between the West and the East. There is little that differentiates us from the rest in a world that is being forced to understand the idea of resource scarcity more than ever before.

In 1776, Adam Smith, in The Wealth of Nations, explained how the East lagged behind because it lacked capitalism and property laws. Niall Ferguson explains how in addition to this, Competition, Applied Science, Property Rights, Modern Medicine, the Consumer Society, and Work Ethic propelled the West into prosperity:

[youtube]http://www.youtube.com/watch?v=xpnFeyMGUs8[/youtube]

This video link by Niall Ferguson shows why the Western world may lag behind as emerging market nations continue to gain in global wealth.

I am sick and tired of watching Occupy Wall Street protests. Stupidity should not be tolerated; we should educate the rest and Occupy Main Street. I asked a protester two weeks ago why he was protesting, and he could not give me a straight answer. His parents unfortunately didn’t teach him the values of hard work and self respect. It reminds me of the guy in this video asking for “millionaires & billionaires” to pay for his college tuition: [youtube]http://www.youtube.com/watch?v=wrPGoPFRUdc&feature=share[/youtube]

Contrast that young man with this young Asian immigrant, who hasn’t been able to set up his business properly in 2 weeks because of the protesters blocking access to his food cart:

[youtube]http://www.youtube.com/watch?v=ZxaUgI0Ascw&feature=related[/youtube]

I can’t believe I would ever say this, but even Ari Gold knows better: [youtube]http://www.youtube.com/watch?v=3Ajh8zKPMXc[/youtube]

Understanding Pension Plans (CFA III) – 1

Tuesday, September 27th, 2011

One of the largest investors in hedge funds, mutual funds, and alternative asset classes, including private equity, timber, and commodities is the pension fund.  As an analyst or a portfolio manager, it is essential to understand the purpose of pension plans, how they are structured, and how they allocate risk.

A pension plan is a portfolio of assets (securities, hard assets) that can support future retirement benefits.  The promise to pay these benefits in the future is a key responsibility of the plan sponsor.

The plan sponsor is the company, non-profit, or government agency that funds the pension plan through periodic payments.

The plan participants are the individuals who receive the pension benefits as they are paid out from the pension plan.

There are also four main types of pension plans, the defined contribution plan, the profit-sharing plan, the defined benefit plan, and the cash balance plan:

1) Defined Contribution Plan: is a pension plan whose retirement payout expectations are framed by contributions to the plan by the plan sponsor.  The liability to the sponsor is only the plan contribution, not the benefit received by the plan participants.

2) Profit Sharing Plan: is a defined contribution plan, where the contributions to the plan are determined by the plan sponsor’s profitability.

3) Defined Benefit Plan: is a pension plan that is framed by the benefits paid to plan participants instead of by the contributions.  Benefits are calculated by taking to account years of service, expected return, expected salary, and other factors that will be explained later.

4) Cash Balance Plan: is a defined pension plan that maintains individual account records for plan participants.  This plan shows each member’s accrued benefits and manages accounts instead of an actual fund.

Funding

Funded Status: relationship between PV (present value) of the pension plan assets and the pension plan liabilities.

Underfunded: PV (present value) of pension plan assets here is less than the PV of the pension plan liabilities.  When plans are underfunded, the may require the sponsors to make special contributions to the plan in addition to regular contributions.

Fully Funded: PV (present value) of pension plan assets here is greater than or equal to the PV of the pension liabilities.  Sponsors can temporarily stop making contributions to the plan’s asset base when the PV of assets > PV of liabilities.

Surplus: difference between the PV of pension plan assets and the PV of pension plan liabilities.

Liabilities

Active lives: the number of plan participants who are not currently receiving pension payments and are still working to save for retirement.

Retired lives: the number of plan participants currently receiving benefits (retirees).

Accumulated Benefit Obligation (ABO): is the total PV of pension liabilities to date, assuming no further accumulation of benefits.

Projected Benefit Obligation (PBO): (PBO) is the ABO  plus projections of future employee compensation increases.  The PBO is the pension liability for a going concern and is the liability figure used in calculating funding status.

Total Future Liability: is the measure of pension liability that is the most comprehensive, because it takes into account not only changes in workforce and inflation in benefits, but salary increases as well.  Total future liabilty is used when setting long term objectives and goals for the plan within the IPS (Investment Policy Statement).

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Aziz Premji Foundation Works to Revolutionize Indian Education

Wednesday, February 23rd, 2011

Aziz Premji, an Indian business tycoon, started his non-profit, Azim Premji Foundation, in 2001 with his own financial assets. The foundation’s main goal is to provide quality universal education in India. The initial focus has been on revolutionizing the public school education system. The new approach encourages students to be more creative when learning; writing stories and conducting independent projects, rather than mindless memorization and stressful year end exams that many children fail. Most students drop out before they reach tenth grade. India has a literacy rate of only 64%, quiet different from China, whose government focus on education has effectuated a literacy rate of 94%. Premji hopes to cause maximum impact by providing help and support to public schools around the country, giving his foundation $2 billion worth of shares in his company. The shares will be used to set up a university in Bangalore, and help spread the new program to 50 of India’s 626 school districts.

PANTNAGAR, India — The Nagla elementary school in this north Indian town looks like many other rundown government schools. Sweater-clad children sit on burlap sheets laid in rows on cold concrete floors. Lunch is prepared out back on a fire of burning twigs and branches.

But the classrooms of Nagla are a laboratory for an educational approach unusual for an Indian public school. Rather than being drilled and tested on reproducing passages from textbooks, students write their own stories. And they pursue independent projects — as when fifth-grade students recently interviewed organizers of religious festivals and then made written and oral presentations.

That might seem commonplace in American or European schools. But such activities are revolutionary in India, where public school students have long been drilled on memorizing facts and regurgitating them in stressful year-end exams that many children fail.

Nagla and 1,500 other schools in this Indian state, Uttarakhand, are part of a five-year-old project to improve Indian primary education that is being paid for by one of the country’s richest men, Azim H. Premji, chairman of the information technology giant Wipro. Education experts at his Azim Premji Foundation are helping to train new teachers and guide current teachers in overhauling the way students are taught and tested at government schools.

For Mr. Premji, 65, there can be no higher priority if India is to fulfill its potential as an emerging economic giant. Because the Indian population is so youthful — nearly 500 million people, or 45 percent of the country’s total, are 19 or younger — improving the education system is one of the country’s most pressing challenges.

“The bright students rise to the top, which they do anywhere in any system,” Mr. Premji said over lunch at Wipro’s headquarters in Bangalore, 1,300 miles south of Uttarakhand. “The people who are underprivileged are not articulate, less self-confident, they slip further. They slip much further. You compound a problem of people who are handicapped socially.”

Outside of India, many may consider the country a wellspring of highly educated professionals, thanks to the many doctors and engineers who have moved to the West. And the legions of bright, English-speaking call-center employees may seem to represent, to many Western consumers, the cheerful voice of modern India.

But within India, there is widespread recognition that the country has not invested enough in education, especially at the primary and secondary levels.

In the last five years, government spending on education has risen sharply — to $83 billion last year, up from less than half that level before. Schools now offer free lunches, which has helped raise enrollments to more than 90 percent of children.

But most Indian schools still perform poorly. Barely half of fifth-grade students can read simple texts in their language of study, according to a survey of 13,000 rural schools by Pratham, a nonprofit education group. And only about one-third of fifth graders can perform simple division problems in arithmetic. Most students drop out before they reach the 10th grade.

Those statistics stand in stark contrast to China, where a government focus on education has achieved a literacy rate of 94 percent of the population, compared with 64 percent in India.

Mr. Premji said he hoped his foundation would eventually make a difference for tens of millions of children by focusing on critical educational areas like exams, curriculum and teacher training. He said he wanted to reach many more children than he could by opening private schools — the approach taken by many other wealthy Indians.

Mr. Premji, whose total wealth Forbes magazine has put at $18 billion, recently gave the foundation $2 billion worth of shares in his company. And he said that he expected to give more in the future.

Those newly donated shares are being used to start an education-focused university in Bangalore and to expand and spread programs like the one here in Uttarakhand and a handful of other places to reach 50 of India’s 626 school districts.

The effort’s size and scope is unprecedented for a private initiative in India, philanthropy experts say. Even though India’s recent rapid growth has helped dozens of tycoons acquire billions of dollars in wealth, few have pledged such a large sum to a social cause.

“This has never been attempted before, either by a foundation or a for-profit group,” said Jayant Sinha, who heads the Indian office of Omidyar Network, the philanthropic investment firm set up by the eBay founder Pierre Omidyar.

Although the results in Uttarakhand are promising, they also suggest that progress will be slow. Average test scores in one of the two districts where the foundation operates climbed to 54 percent in 2008, up from 37.4 percent two years earlier. (A passing mark is 33 percent or higher.) Still, only 20 of the 1,500 schools that the foundation works with in Uttarakhand have managed to reach a basic standard of learning as determined by competence tests, enrollment and attendance. Nagla is not one of the 20.

“We are working with the kids who were neglected before,” said D. N. Bhatt, a district education coordinator for the Uttarakhand state government. “You won’t see the impact right away.”

The Premji Foundation helps schools in states where the government has invited its participation — a choice that some educational experts criticize because it seems to ignore fast-growing private schools that teach about a quarter of the country’s students, including many of India’s poor.

Narayana Murthy, a friend of Mr. Premji and chairman of Infosys, a company that competes with Wipro, said he admired the Premji Foundation’s work but worried it would be undermined by the way India administers its schools.

“While I salute Azim for what he is doing,” Mr. Murthy said, “in order to reap the dividends of that munificence and good work, we have to improve our governance.”

Mr. Premji says his foundation would be willing to work with private schools. But he argues that government schools need help more because they are often the last or only resort for India’s poorest and least educated families.

Mr. Premji, whose bright white hair distinguishes him in a crowd, comes from a relatively privileged background. He studied at a Jesuit school, St. Mary’s, in Mumbai and earned an electrical engineering degree at Stanford.

At 21, when his father died, Mr. Premji took over his family’s cooking oil business, then known as Western Indian Vegetable Product. He steered the company into information technology and Wipro — whose services include writing software and managing computer systems — now employs more than 100,000 people. He remains Wipro’s largest shareholder.

While the foundation has been welcomed by government officials in many places, the schools in Uttarakhand provide a glimpse of the challenges it faces.

After visitors left a classroom at Nagla school, an instructor began leading more than 50 fifth-grade students in a purely rote English lesson, instructing the students to repeat simple phrases: Good morning. Good afternoon. Good evening. Good night. The children loudly chanted them back in unison.

Another teacher later explained that the instructor was one of two “community teachers” — local women hired by a shopkeeper to help the understaffed school. Although under government rules Nagla should have nine trained teachers for its 340 students, it has only four.

Underfunding is pervasive in the district. But so are glimmers of the educational benefits that might come through efforts like the Premji Foundation’s.

Surjeet Chakrovarty, now a 15-year-old secondary school student, is a graduate of Nagla and still visits his old school regularly. The son of a widower who is a sweeper at a local university, Surjeet aspires to become a poet and songwriter — something he attributes to the encouragement of his former teachers at Nagla.

“My teachers here gave me so much motivation to write,” he said.

One of those Nagla teachers, Pradeep Pandey, shared credit with the Premji Foundation, and its assistance in developing new written and oral tests.

“Before, we had a clear idea of the answers and the child had to repeat exactly what we had in mind,” Mr. Pandey said. “We can’t keep doing what we did in the past, and pass them without letting them learn anything.”

LA Basic Leveraged Buyout Modeling Video Available for Only $99!

Friday, March 19th, 2010

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The LBO video is available for $129.99 on DVD and $99.99 online. Please e-mail info@leverageacademy.com for screen shots and a link to download and purchase.

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A host of more complicated LBO modeling videos will be available shortly, including a model that will take more than 8 hours to complete.

Interview DOs and DON’Ts

Saturday, March 13th, 2010
Interview DOs and DON’Ts
Interview DOs
Do Dress appropriately for the industry; err on the side of being conservative to show you take the interview seriously. Your personal grooming and cleanliness should be impeccable.
Do Know the exact time and location of your interview; know how long it takes to get there, park, find a rest room to freshen up, etc.
Do Arrive early; 10 minutes prior to the interview start time.
Do Treat other people you encounter with courtesy and respect. Their opinions of you might be solicited during hiring decisions.
Do Offer a firm handshake, make eye contact, and have a friendly expression when you are greeted by your interviewer.
Do Listen to be sure you understand your interviewer’s name and the correct pronunciation.
Do Even when your interviewer gives you a first and last name, address your interviewer by title (Ms., Mr., Dr.) and last name, until invited to do otherwise.
Do Maintain good eye contact during the interview.
Do Sit still in your seat; avoid fidgeting and slouching.
Do Respond to questions and back up your statements about yourself with specific examples whenever possible.
Do Ask for clarification if you don’t understand a question.
Do Be thorough in your responses, while being concise in your wording.
Do Be honest and be yourself.  Dishonesty gets discovered and is grounds for withdrawing job offers and for firing. You want a good match between yourself and your employer. If you get hired by acting like someone other than yourself, you and your employer will both be unhappy.
Do Treat the interview seriously and as though you are truly interested in the employer and the opportunity presented.
Do Exhibit a positive attitude. The interviewer is evaluating you as a potential co-worker. Behave like someone you would want to work with.
Do Have intelligent questions prepared to ask the interviewer. Having done your research about the employer in advance, ask questions which you did not find answered in your research.
Do Evaluate the interviewer and the organization s/he represents. An interview is a two-way street. Conduct yourself cordially and respectfully, while thinking critically about the way you are treated and the values and priorities of the organization.
Do Do expect to be treated appropriately. If you believe you were treated inappropriately or asked questions that were inappropriate or made you uncomfortable, discuss this with a Career Services advisor or the director.
Do Make sure you understand the employer’s next step in the hiring process; know when and from whom you should expect to hear next. Know what action you are expected to take next, if any.
Do When the interviewer concludes the interview, offer a firm handshake and make eye contact. Depart gracefully.
Do After the interview, make notes right away so you don’t forget critical details.
Do Write a thank-you letter to your interviewer promptly.
Interview DON’Ts
Don't Don’t make excuses. Take responsibility for your decisions and your actions.
Don't Don’t make negative comments about previous employers or professors (or others).
Don't Don’t falsify application materials or answers to interview questions.
Don't Don’t treat the interview casually, as if you are just shopping around or doing the interview for practice. This is an insult to the interviewer and to the organization.
Don't Don’t give the impression that you are only interested in an organization because of its geographic location.
Don't Don’t give the impression you are only interested in salary; don’t ask about salary and benefits issues until the subject is brought up by your interviewer.
Don't Don’t act as though you would take any job or are desperate for employment.
Don't Don’t make the interviewer guess what type of work you are interested in; it is not the interviewer’s job to act as a career advisor to you.
Don't Don’t be unprepared for typical interview questions. You may not be asked all of them in every interview, but being unprepared looks foolish.
Don't A job search can be hard work and involve frustrations; don’t exhibit frustrations or a negative attitude in an interview.
Don't Don’t go to extremes with your posture; don’t slouch, and don’t sit rigidly on the edge of your chair.
Don't Don’t assume that a female interviewer is “Mrs.” or “Miss.” Address her as “Ms.” unless told otherwise. (If she has a Ph.D. or other doctoral degree or medical degree, use “Dr. [lastname]” just as you would with a male interviewer. Marital status of anyone, male or female, is irrelevant to the purpose of the interview.
Don't Don’t chew gum or smell like smoke.
Don't Don’t allow your cell phone to sound during the interview. (If it does, apologize quickly and ignore it.) Don’t take a cell phone call. Don’t look at a text message.
Don't Don’t take your parents, your pet (an assistance animal is not a pet in this circumstance), spouse, fiance, friends or enemies to an interview. If you are not grown up and independent enough to attend an interview alone, you’re insufficiently grown up and independent for a job. (They can certainly visit your new city, at their own expense, but cannot attend your interview.) SOURCE: Virginia Tech

Researching Your Employer – Tips

Saturday, March 13th, 2010
Researching employers: why and how
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Why research

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To show you care about the role. The worst stories I have heard about interviews are where interviewees were not enthusiastic, or did not know the company’s, CEO, stock price, or recent financial performance.  If you are interviewing for an investment banking role at Citigroup, know the last 3 major deals the firm has worked on.  If you are interviewing for a role at Wellington, look at 13-Fs to know its largest stock holdings.  Know its most famous portfolio managers and their performance.  How did they perform compared to market benchmarks?

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To effectively sell yourself as a job candidate, you need to be able to persuade the employer that you are a fit for that employer’s needs. Even when the job market is great for job seekers, employers aren’t going to interview and hire candidates who are not a match for their needs.

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You can’t present yourself — in cover letters or interviews — as a match for the employer’s needs if you don’t know enough about the employer to do so.

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By doing research, you get information to decide which employers to contact.  Rather than sending fifty letters/e-mails and resumes to employers you know little to nothing about, send ten letters and resumes to employers you know something about and have a greater chance of securing an interview.  Targeted letters, individualized to the recipient are more effective than “form” letters — you know a form letter when you receive one; employers do too.

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In interviews, employers expect you to arrive knowing background information about the organization.  If you don’t, you look like you’re not really interested in the job.  You have to be able to answer the critical question of why you would like to work for that employer — and not sound like you would take any job.

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Research helps you formulate intelligent and appropriate questions to ask in your interview.
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How to research specific employers

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Talk to professionals: Find people who work for or know about the organization.  Look through LinkedIn and your alumni network.  Talk to friends and family members who work in the industry.  Speak to people you meet at a career fairs, forums, and networking events.

..

The employer’s web site:  This is a no-brainer! Look for basic facts, information about mission, culture, values and more. If the web site posts jobs and/or the organization invites e-mail from job seekers and/or accepts resumes online, follow the instructions the employer provides.

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Internet research. Note sources of information you find and gauge the credibility of those sources.

...,.

Public filings. Read the employers 10-k, 10-q.  Pay attention to earnings calls and read transcripts, which are made available for free on SeekingAlpha.com.

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Databases. Use CapitalIQ, Thomson One Banker, and Factset to uncover research and data on your company, so that you know what deals the firm has been on and understand the company’s financial performance.  Know the company’s major competitors as well.

.

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Call or write the organization and ask for information AFTER you’ve searched for it elsewhere.  This is perfectly appropriate to do if you simply cannot find information about the organization through their web site, or if the information is not clear.  If you have an interview scheduled with an employer, the employer should have already provided information (web site, brochures, etc.); if not, by all means, ask for this.
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Be careful. If you e-mail with a question the answer to which you could have found online with a little effort, you’ll be perceived negatively as a potential employee (lazy, not smart….). As a potential employee, you want to be perceived as a person who does work, not creates more for someone else.

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Source: Virginia Tech, SeekingAlpha, Boston University

Call or write the organization and ask for information AFTER you’ve searched for it elsewhere.  This is perfectly appropriate to do if you simply cannot find information about the organization through their web site, or if the information is not clear.  If you have an interview scheduled with an employer, the employer should have already provided information (web site, brochures, etc.); if not, by all means, ask for this.

Proper Interview Attire

Saturday, March 13th, 2010
Clothing Etiquette
In an interview your attire plays a supporting role.
Your conduct, your interpersonal skills and your ability to articulate intelligent and well thought out responses to questions are the most important elements.
Appropriate attire supports your image as a person who takes the interview process seriously and understands the nature of the industry in which you are trying to become employed.
Be aware that in some industries, customer contact and image presented to the customer is critical. In such industries, your attire will be judged more critically.
Your attire should be noticed as being appropriate and well-fitting, but it should not take center stage.
If you are primarily remembered for your interview attire, this is probably because you made an error in judgment!
Dressing nicely and appropriately is a compliment to the person you meet, so if in doubt, err on the side of dressing better than you might need to.
Even if you are aware that employees of an organization dress casually on the job, dress up for the interview unless you are specifically told otherwise by the employer.
Never confuse an interview or business function with a social event. Don’t dress for a party or a date.
Not every contact with an employer requires interview attire. For some occasions business casual is appropriate. See business casual for when to wear it and what it is.
Changes in fashion may change some things, like the width of lapels, the cut of pants, or the colors of blouses available in the stores. Basic professional attire does not change with the whims of fashion. A good suit should last five to ten years, depending on its quality, how hard you wear it, how well you care for it, and if it continues to fit you well. You can express fashion’s whims in your off-the-job clothes, and to some extent in your accessories.
Interview attire guidelines for men and women
Suit:
A two piece matched suit is always the best and safest choice.
But what if the job is in a non-suit-wearing work environment:
Even if you would or could wear jeans on the job, or the work environment is outdoors and very non-suit, wearing a suit to the interview shows you take the interview seriously as a professional meeting. Dressing well is a compliment to the person(s) with whom you meet. If you think the industry in which you’re interviewing would frown on a suit, or the interview will involve going to a work site where a suit would be inappropriate, look for advice through professional organizations, your professors who have been employed in that industry, and/or by asking the employer directly and politely.
Conservative colors / fabric:
Navy, dark gray (and black for women) — are safe.
Other color trends may come and go; avoid the extremes.
Solids or very subtle weave patterns or plaids (the kind that look solid across a room) are safest.
Wool, wool blends, or good quality micro fiber for women only, are generally the best fabrics in all seasons. Avoid acetate / rayon blends.
Cost / quality:
You are not expected to be able to afford the same clothing as a corporate CEO. Do invest in quality that will look appropriate during your first two or three years on the job. One good quality suit is sufficient for a job search if that is all your budget allows. You can vary your shirt/blouse tie/accessories.
Details:
Everything should be clean and well pressed.
Carefully inspect clothes for tags, dangling threads, etc.
Additional interview attire specifics for men
Suit:
A two-piece matched suit is always the best and safest choice. Don’t combine a suit jacket with pants that don’t match.
Conservative colors / fabric:
Navy and dark gray are safe and are the most conservative for men. Black for men was once considered severe or overly formal, and may still be considered so in very conservative industries, although it is commonly worn by many. Other color trends may come and go; avoid the extremes. Choose a solid or very subtle weave pattern or plaid (the kind that look solid across a room). Wool, wool blends, or very high quality blends with natural fiber, are the only acceptable fabrics for a conservative men’s suit.
Cost / quality:
You are not expected to be able to afford the same clothing as a corporate CEO. Do invest in quality that will look appropriate during your first two or three years on the job. One good quality suit is sufficient for a job search if that is all your budget allows. You can vary your shirt and tie.
Ties:
Tie styles come and go. Select good quality silk ties.
Avoid fashion extremes, like character ties, in interviews.
Notice what men in your industry wear on the job, at career fairs, at information sessions, when they meet with clients.
Shirts:
Long-sleeved shirts, even in summer. Choose white or light blue solid, or conservative stripes.
Socks:
Dark socks, mid-calf length so no skin is visible when you sit down.
Shoes:
Leather, lace-up or slip-on business shoes, preferably black or cordovan. Invest in a good pair; even if you don’t wear them daily on the job, you’ll need them for other occasions and you should expect to get lots of years out of good shoes.
Belt:
Black or cordovan leather, to match your shoes.
Facial hair:
If worn, should be well-groomed. Observe men in your industry if you are unsure what’s appropriate or are considering changing your look.
Jewelry:
Wear a conservative watch. If you choose to wear other jewelry, be conservative. Removing earrings is safest. For conservative industries, don’t wear earrings. Observe other men in your industry to see what is acceptable.
Details:
Everything should be clean and well pressed. Suits typically have tacking stitches to hold vents — on the jacket back and on sleeves — in place before the garment is purchased. Cut them off if your retailer / tailor doesn’t. And that tag stitched on the outside of your sleeve is not meant to stay there like a Tommy Hilfiger label — cut it off! Carefully inspect clothes dangling threads, etc.
Additional interview attire specifics for women
Don’t confuse club attire with business attire. If you would wear it to a club, you probably shouldn’t wear it in a business environment.
Suit:
Wear a two-piece matched suit.
Suit – pants / skirts:
Tailored pants suits are appropriate for women. Pants suits can be an excellent choice for site visits, particularly if the visit involves getting in and out of vehicles and/or the site is (or includes) a manufacturing plant or industrial facility. If you wear pants, they should be creased and tailored, not tight or flowing. If you are pursuing a conservative industry and are in doubt, observe well dressed women in your industry on the job, at career fairs, at information sessions, etc.
Skirt lengths:
Much of what you see on television shows that masquerades for professional attire is actually inappropriate for a work environment. Your skirt should cover your thighs when you are seated. Showing a lot of thigh makes you look naive at best, foolish at worst. A skirt that ends at the knee when you’re standing looks chic and professional. Longer skirts are professional too; just make sure they are narrow enough not to be billowing, but not so narrow that you can’t climb stairs comfortably. Don’t purchase a skirt or decide on a hem length until you sit in the skirt facing a mirror. That’s what your interviewer will see. Ask yourself whether it will be distracting or reinforce your image as a person who looks appropriate for a business environment or gathering. High slits in skirts are not appropriate. A small back, center slit in a knee-length skirt is appropriate. On a calf length skirt, a slit to the knee to facilitate walking and stair climbing is appropriate.
Color / fabric:
Navy, dark gray, brown and black are safe. Other color trends may come and go; avoid the extremes. Women generally have more options with suit color than men. For example, while a women could look conservative in a slate blue or light gray suit, these colors would be inappropriate for men. Choose a solid or very subtle weave pattern or plaid (the kind that look solid across a room). Wool, wool blends, and high quality blends and synthetics are apprpriate for women’s suiting.
Shirt / sweaters:
Underneath the suit jacket, wear a tailored blouse in a color or small print that coordinates nicely with your suit. A fine gauge, good quality knit shell is also appropriate underneath your suit jacket. Don’t show cleavage. (Remember that television shows are trying to attract viewers, and don’t represent reality of the professional environment.)
Jewelry / accessories:
Wear a conservative watch. Jewelry and scarf styles come and go. Keep your choices simple and leaning toward conservative. Avoid extremes of style and color. If your industry is creative, you may have more flexibility than someone pursuing a conservative industry.
Cosmetics:
Keep makeup conservative. A little is usually better than none for a polished look.  Nails should be clean and well groomed. Avoid extremes of nail length and polish color, especially in conservative industries.
Shoes:
Should be leather or fabric / micro fiber. Shoe styles and heel heights come and go. Choose closed-toe pumps. Regardless of what is in style, avoid extremes; no stilettos or chunky platforms. Make certain you can walk comfortably in your shoes; hobbling in uncomfortable shoes does not convey a professional appearance.
Hosiery:
Should be plainly styled (no patterns), sheer is most conservative (not opaque), and in neutral colors complementing your suit. Avoid high contrast between your suit and hosiery color.
Purse / bag:
If you carry a purse, keep it small and simple, especially if you also carry a briefcase.  Purse color should coordinate with your shoes. You may choose to carry a small briefcase or business-like tote bag in place of a purse. Leather is the best choice for briefcases; micro fiber or fine wovens are also acceptable.
Grooming tips for everyone
Hair:
Should be clean and neat.
Shoes:
Should be in polished condition. Make sure heels are not worn.
Details:
No missing buttons, no lint; and don’t forget to remove external tags and tacking stitches from new clothes.
Hands:
Clean fingernails.
Fit:
Clothes should be clean, neatly pressed, and fit properly.
Smell:
Perfume or cologne should be used sparingly or not at all. No odors in clothes. Don’t smell like smoke.
Pad folios:
Preferred over a bulky briefcase. A small briefcase is also appropriate. But if you have no reason to carry a briefcase, don’t; you risk looking silly.
Book bags:
Leave it at home for an on-site interview. For an on-campus interview, you can leave it in the waiting area.

What are the Stages of an Interview?

Saturday, March 13th, 2010
Typical stages of the interview:
1. Beginnings, Introduction
The interviewer will establish rapport and create a relaxed, though businesslike, atmosphere. This is where the interviewer gets the very important first impression of you.
2. Background & Interests
This usually takes the form of “what,” “why,” “where,” and “when” types of questions. Focus on what you are like, and what you have accomplished, your academic and work background, and your goals. One of the interviewer’s objectives is to see if your qualifications match your declared work interests. Give concise but thorough responses to questions.
3. Qualifications
Assuming you have the necessary qualifications, the interviewer will begin the process of determining whether the employer’s job opening(s) match your interests and qualifications. If there seems to be a match, the interviewer will probably explain job details to see how interested you are in the position.
4. Finale
In this stage, the interviewer should explain what the next steps are in the hiring process. Be sure you understand them. Promptly provide any additional information requested. There should be ample opportunity for you at this point to ask any questions you have.

What are Behavioral Interviews? How Do You Approach Them?

Saturday, March 13th, 2010

What Are Behavioral Interviews?
•     Behavioral interviewing is a technique used by employers in which the questions asked assist the employer in making predictions about a potential employee’s future success based on actual past behaviors, instead of based on responses to hypothetical questions.
•     In behavior-based interviews, you are asked to give specific examples of when you demonstrated particular behaviors or skills.
•     General answers about behavior are not what the employer is looking for. You must describe in detail a particular event, project, or experience and you dealt with the situation, and what the outcome was.

Examples of interview questions:
•     Describe a time when you were faced with problems or stresses at work that tested your coping skills. What did you do?
•     Give an example of a time when you had to be relatively quick in coming to a decision.
•     Give me an example of an important goal you had to set and tell me about your progress in reaching that goal.
•     Describe the most creative work-related project you have completed.
•     Give me an example of a problem you faced on the job, and tell me how you solved it.
•     Tell me about a situation in the past year in which you had to deal with a very upset customer or co-worker.
•     Give me an example of when you had to show good leadership.

Structuring the response:
•     The “S.T.A.R.” technique is a good approach: Describe the Situation you were in or the Task you needed to accomplish; describe the Action you took, and the Results.
•     Be specific, not general or vague.
•     Don’t describe how you would behave. Describe how you did actually behave. If you later decided you should have behaved differently, explain this. The employer will see that you learned something from experience.