20 Essentials for Achieving Financial Literacy

4. Finance: If you're a finance major, then at the very minimum you should take two courses: Business/corporate finance (in some schools this is a two-course structure) and investment analysis. Business/corporate finance covers capital budgeting, asset structure, asset pricing, efficient markets hypothesis, financial instruments and the time value of money . Investment analysis will introduce you to the CAPM (capital asset pricing model), financial markets and the investment decision process.

I am going to add one additional course which is an elective at most schools: derivatives . If you have serious thoughts of getting into the financial markets, then a course in derivatives (including options , futures and swaps ) is a must. Derivatives encompass the fastest-growing disciplines within sales and trading. Students with a background in derivatives will have more employment opportunities and can expect higher pay in the long run.

5. Instructors matter: I have seen bad instructors turn good courses into bad experiences, and I have seen good instructors make unbearable subjects palatable.

The key to course selection is to find the best instructor who will likely deliver the best learning experience. How? Speak to other students and to your faculty adviser, and in some instances you might be able to obtain class and instructor ratings.

I have been fortunate to have studied under many learned educators during my life. To this day, I recall their teachings and use them in my daily personal and professional life. When an upperclassman at Wharton, I had the choice of taking corporate finance with Professor Jeremy Siegel (see "Jeremy Siegel Says Get Ready to Buy") or advanced macroeconomics with a young professor by the name of Robert Shiller (see "American Dream's Harsh New Reality"). As it turns out, this was a win-win choice, because both of these esteemed academics have contributed extensively to the fields of finance and economics.

At NYU, I took a course on fixed-income and credit markets taught by Professor Edward Altman. To this day, I still use Altman's "Z-Scores" as retrieved off of my Bloomberg terminal before I make an investment decision. (The Z-Score is a formula which attempts to predict the likelihood of bankruptcy by using a weighted average of several balance-sheet variables.)