Median-based Trend Analysis – despite being Industry Standard – must be Challenged

(Click on the image to enlarge)

Ryan is interviewing for a Supervising Analyst position with a major think-tank.

Question # 1
Interviewer: These two graphics are derived from the same housing market and reflect the same period. Why do they look so dissimilar? To keep the conversation more professional, let's address the Monthly Median Sale Price as the Champion or Champ and the Monthly Median Sale Price per Square Feet as the Challenger.

Ryan: This dissimilarity proves that an industry-standard Champ needs to be validated or challenged. A prudent market analyst must not take a set of established assumptions for granted; instead, the analyst should subject such assumptions to frequent tests and validations.

Question # 2
Interviewer: Why do you think that is important? What's wrong with a time-tested Champ? Why do you need to introduce an untested Challenger?

Ryan: The Challenger helps identify any on-going shifts in the market; for example, when the prospective buyers are gradually moving towards smaller homes, the demand pattern shifts. The Champ will not capture and reflect that shift in the demand pattern, but the Challenger definitely will. That is why analysts should meaningfully challenge the Champ.

Question # 3
Interviewer: Why are the double top and double bottom formations bearish and bullish, respectively?

Ryan: A double top is bearish because it fails to break out of the congestion, generally with a downward trend. On the other hand, a double bottom is bullish as it's a breakout event with an up-sloping linear trend, often making new highs. 

Question # 4
Interviewer: Explain the difference between the two in more quantitative terms.

Ryan: After peaking at $320,000, the Champ remained sideways, congesting between $300,000 and $310,000. The Challenger trend was almost diametrically opposite with an extremely bullish up-sloping double bottom, eclipsing the prior high of $180/SF. Even the moving average has confirmed the breakout.

Question # 5
Interviewer: If you have to show one of the two graphs to our clients, which one would you choose and why?

Ryan: I would choose the Challenger graph, as it captures and depicts the market's underlying fundamentals. 

Question # 6
Interviewer: Is there a missing piece in this presentation explaining why these two solutions are diverging? If so, how would you present that data?

Ryan: Yes, the Monthly Median Home Size (SF) is missing. SF would explain why they are diverging. I would use a simple table showing all three monthly data variables without showing these two-dimensional graphs.  

Question # 7
Interviewer: Why do you think the bullish R-squared is so much higher than its bearish counterpart?

Ryan: Because that's the right trendline for the slope of the curve. The bearish one does not demonstrate a linear trend, so the resulting R-squared is low.

Question # 8
Interviewer: In that case, what type of trendline would you fit, and how much difference would that make?

Ryan: I would fit a polynomial trendline of the 6th order, expecting reasonably similar results. 

Interviewer: Give me a minute and let me check it out. Yes, you are right; it's 0.794. That's excellent data visualization. Congrats!

Question # 9
Interviewer: Would you use the median-based analysis in business decision-making? If not, how would you improve upon it?

Ryan: The median-based analysis is necessary for quick and dirty analysis but isn't sufficient in making business decisions. I would use an extended percentile data curve like 5th to 95th, without the outliers.  

-Sid Som, MBA, MIM

homequant@gmail.com

Link to the Book

How to Ace an Interview

Ceteris paribus, meaning other conditions remaining the same:

• Read a book or two on interview strategies.
• Watch a few video clips on dos and don'ts.
• Skim through several trend-setting articles subject.

This chapter by no means attempts to compete with them. Instead, it's strictly complementary. Having sat on both sides of the table, I will share my humble but slightly different take on interviews. However, I will describe my experience by combining both, i.e., how I used to approach interviews as a candidate and later what specific qualities I used to look for in candidates when I interviewed them.

1. Try Match Practice before Interviewing with the Targeted Companies. Just the way teams play several exhibition/warm-up matches before starting a major tournament, it's always healthy to interview with several second-tier companies within the industry before starting with the targeted companies. For instance, even if you target the central investment banks like Goldman Sachs, Morgan Stanley, Credit Suisse, JP Morgan Chase, etc., it's a good idea to start the interview process with several second-tier investment banks, followed by the actual targets. It will immensely enhance your confidence as you begin interviewing with your targeted companies. If the question comes up during the interview, make a generic statement like "I am focusing on investment banks only" or "Yes, I am interviewing with some of your competitors as well," etc., without making any specific name reference or categorization (1st-tier, 2nd-tier, etc.) whatsoever. 

2. Right at the outset, Ask the Interviewers if you could use your Notepad (or if you could Borrow one). FYI, the vast majority of interview questions have multiple parts, and it's generally by design. Simply put, they try to test that you can retain and answer them in the right sequence. By having a notepad in front of you, you can jot down the different parts of the questions and the sequence they are being asked, which will help you concentrate on the answers, without having to remember the various factors and juggle with the arrangements (which carry no extra points). Even if you disagree with any sequence, do not take the liberty to alter them. A candidate who does not write the questions down often expresses, "Let me start with the last part first" and rarely address the rest as they often fail to remember the last parts. Again, as a candidate, you have no right to alter the sequence. The interviewers are in charge, and you follow their instructions. There is no room for any arrogance.

3. Be Polite while answering the Opening Question, usually about yourself. Generally, the first question is about yourself (e.g., introduce yourself, describe your achievements, etc.). The interviewers typically throw the ball into your court, thus allowing you to "set the tone." Even if you had aced the SAT and then maintained straight A's in college, do not harp on that string. Instead, politely answer that you managed to "do well" in high school and college, moving on to your college major's specifics, leading to the thesis of your internship. Since your achievements are already bulleted in your resume, there is no need to double down on them. Instead, set a polite tone which will immensely impress upon them, so much so that it will have a serene carry-forward impact throughout the interview. Smart people try to minimize the use of the braggadocios' pronoun "I" and consider its overuse morally hazardous. 

4. Be equally Polite while addressing your "Strengths and Weaknesses". This tends to be a common question for new graduates. Instead of parroting a list of strengths from the Internet, politely specify a handful of diverse and meaningful (mostly related to this job) attributes saying, "These are some of the strengths that have been pointed out to me over the years" or another polite expression along this line. Do not makeup weaknesses to create an answer. Instead, politely and confidently say, "Nothing has ever been pointed out to me." If you make one up, the conversation will take a negative turn, often with a snowball effect. Remember, "Goods well bought are already half sold." The fact that you are being interviewed (and I'm talking about a real management interview, not just an HR interview) bumps your point of origin up to 50 -- it's not 0 anymore. So, continue to ride on the rising positive momentum, without the need for any negative emotions, which may only act to your detriment.

5. Show a very Positive Attitude while Describing your Knowledge and Impression of the Company. This is another general question for the new graduates. As a candidate, you must have this answer well-prepared and adequately practiced. Instead of spending too much time and effort on the company's headcounts, ultra-modern real estates, and global footprints, emphasize on what attracts you about this company: how the company became the best in class; its world-class training program; its perennial growth prospects; its cutting edge marketing initiatives; its top-of-the-line yet highly diverse workforce; its proven and consistent room for growth, etc., but staying away from the obvious like excellent salary, benefits, physical work environments, etc. Refrain from getting bogged down to balance sheet nitty-gritty, holding back all of your questions till the end or until you are asked to do so. Just focus on addressing their issues as politely, precisely, and thoughtfully as you professionally can.  

6. Avoid any Negative Talk/Opinion about your Current or Prior Employers and Bosses. If you completed an internship or held temp/part-time jobs during the college years, do disclose all of them in your resume. If you are asked to talk about them, try to keep the narrative as positive and perfect as possible. Smart people do not enjoy negative talks or tones. If you do, they may sympathize with you superficially, but rest assured you will be pushed down to the list's bottom. We all know life is not a bed of roses, so smart people do not waste time dwelling in the past; they move on and work towards a brighter tomorrow. At an early age, I learned from Lord Buddha to live in the present, which always helped me stay positive and focused. Positive people are inherently more productive and tend to make great corporate leaders. Their positive energy helps create very positive work environments. No doubt, it's a real blessing to work with a perennially upbeat boss.

7. While answering the Main Questions, try to Walk Away from the Herd. Remember, for two or three openings, the shortened list may still comprise twenty to thirty highly qualified candidates. So, while answering the main questions, use your knowledge (depth) and intelligence (ability to get to and stick to the real issue) to narrow the competition. In doing so, whenever you can, try to walk away from the herd, so you stand out -- in addition to conventional thinking, present outside-of-the-box solutions, preferably with the help of some real examples from your internship, work/study programs, etc. Soon, you will be solving enterprise-level challenges, so make an emphatic case in front of them that you are capable of rising way above the occasion and, thus, you rightfully belong there alongside those brilliant minds. 

8. Save the Best for Last. Show off your Mettle with some Awe-inspiring Questions. The primary interview has ended. Now, it's your turn to ask them some questions. Remember, this is the only part of the interview you will control, so it's your time to show off your Mettle. Bang away with questions they have never heard of. Bang away with items that will leave them wanting more. Bang away with things that they will ask one another later. Bang away with questions that will prove you are the super-human they have been waiting for. Anything less will significantly reduce your chances. Whatever answers you get, accept them politely. It's impolite to ask them follow-up questions; instead, move on to the next question. Again, this is not the forum to ask any HR questions. Even if the topic comes up, politely decline it by saying, "If I have any HR questions, I will later contact the HR Department. Thank you anyway." 

9. Rejections must Inspire you to Prepare harder and smarter for Future Interviews. While you should take rejection as a passing show, it must also inspire and impel you to prepare better for future interviews. Steve Jobs used to say, "You can't connect the dots looking forward; you can only connect them looking backward." Every time I was rejected (after having interviewed), I told myself I was not prepared enough to get the job. Then again, I knew quite well the mistakes I made and promised myself I would not repeat them. Of course, one of the best ways to reduce the incidence of classic or run-of-the-mill errors is to allow yourself some meaningful match practice (#1 above). A rejection is not a let-down, rather a reminder of better opportunities ahead, taking advantage of which requires slightly better preparations. You are almost there!

A few years ago, I was (phone) interviewing an overseas candidate for a Senior Analyst position. I was so impressed with the answers that I had to give him a perfect 10. Then it was his turn to ask me some questions. The first question he asked pertained to his work hours. I had no choice but to mark the one off his score. The point is, when you are interviewing for a career job that might lead you to be the future CEO of the company, the last thing you should think about is your work hours. When you are starting in the labor force, you have to be flexible. If you are looking for an 8 to 5 job, you need to redevelop that Mettle.

-Sid Som, MBA, MIM

homequant@gmail.com

Link to the Book

Median-based Trend Analysis – Despite being Industry Standard – Must be Challenged

(Click on the image to enlarge)

Ryan is interviewing for a Supervising Analyst position with a major think-tank.

Question # 1
Interviewer: These two graphics are derived from the same housing market and reflect the same period. Why do they look so dissimilar? To keep the conversation more professional, let's address the Monthly Median Sale Price as the Champion or Champ and the Monthly Median Sale Price per Square Feet as the Challenger.

Ryan: This dissimilarity proves that an industry-standard Champ needs to be validated or challenged. A prudent market analyst must not take a set of established assumptions for granted; instead, the analyst should subject such assumptions to frequent tests and validations.

Question # 2
Interviewer: Why do you think that is important? What's wrong with a time-tested Champ? Why do you need to introduce an untested Challenger?

Ryan: The Challenger helps identify any on-going shifts in the market; for example, when the prospective buyers are gradually moving towards smaller homes, the demand pattern shifts. The Champ will not capture and reflect that shift in the demand pattern, but the Challenger definitely will. That is why analysts should meaningfully challenge the Champ.

Question # 3
Interviewer: Why are the double top and double bottom formations bearish and bullish, respectively?

Ryan: A double top is bearish because it fails to break out of the congestion, generally with a downward trend. On the other hand, a double bottom is bullish as it's a breakout event with an up-sloping linear trend, often making new highs. 

Question # 4
Interviewer: Explain the difference between the two in more quantitative terms.

Ryan: After peaking at $320,000, the Champ remained sideways, congesting between $300,000 and $310,000. The Challenger trend was almost diametrically opposite with an extremely bullish up-sloping double bottom, eclipsing the prior high of $180/SF. Even the moving average has confirmed the breakout.

Question # 5
Interviewer: If you have to show one of the two graphs to our clients, which one would you choose and why?

Ryan: I would choose the Challenger graph, as it captures and depicts the market's underlying fundamentals. 

Question # 6
Interviewer: Is there a missing piece in this presentation explaining why these two solutions are diverging? If so, how would you present that data?

Ryan: Yes, the Monthly Median Home Size (SF) is missing. SF would explain why they are diverging. I would use a simple table showing all three monthly data variables without showing these two-dimensional graphs.  

Question # 7
Interviewer: Why do you think the bullish R-squared is so much higher than its bearish counterpart?

Ryan: Because that's the right trendline for the slope of the curve. The bearish one does not demonstrate a linear trend, so the resulting R-squared is low.

Question # 8
Interviewer: In that case, what type of trendline would you fit, and how much difference would that make?

Ryan: I would fit a polynomial trendline of the 6th order, expecting reasonably similar results. 

Interviewer: Give me a minute and let me check it out. Yes, you are right; it's 0.794. That's excellent data visualization. Congrats!

Question # 9
Interviewer: Would you use the median-based analysis in business decision-making? If not, how would you improve upon it?

Ryan: The median-based analysis is necessary for quick and dirty analysis but isn't sufficient in making business decisions. I would use an extended percentile data curve like 5th to 95th, without the outliers.  

-Sid Som, MBA, MIM

homequant@gmail.com

Link to the Book

How to Ace an Interview

Ceteris paribus, meaning other conditions remaining the same:

• Read a book or two on interview strategies.
• Watch a few video clips on dos and don'ts.
• Skim through several trend-setting articles subject.

This chapter by no means attempts to compete with them. Instead, it's strictly complementary. Having sat on both sides of the table, I will share my humble but slightly different take on interviews. However, I will describe my experience by combining both, i.e., how I used to approach interviews as a candidate and later what specific qualities I used to look for in candidates when I interviewed them.

1. Try Match Practice before Interviewing with the Targeted Companies. Just the way teams play several exhibition/warm-up matches before starting a major tournament, it's always healthy to interview with several second-tier companies within the industry before starting with the targeted companies. For instance, even if you target the central investment banks like Goldman Sachs, Morgan Stanley, Credit Suisse, JP Morgan Chase, etc., it's a good idea to start the interview process with several second-tier investment banks, followed by the actual targets. It will immensely enhance your confidence as you begin interviewing with your targeted companies. If the question comes up during the interview, make a generic statement like "I am focusing on investment banks only" or "Yes, I am interviewing with some of your competitors as well," etc., without making any specific name reference or categorization (1st-tier, 2nd-tier, etc.) whatsoever. 

2. Right at the outset, Ask the Interviewers if you could use your Notepad (or if you could Borrow one). FYI, the vast majority of interview questions have multiple parts, and it's generally by design. Simply put, they try to test that you can retain and answer them in the right sequence. By having a notepad in front of you, you can jot down the different parts of the questions and the sequence they are being asked, which will help you concentrate on the answers, without having to remember the various factors and juggle with the arrangements (which carry no extra points). Even if you disagree with any sequence, do not take the liberty to alter them. A candidate who does not write the questions down often expresses, "Let me start with the last part first" and rarely address the rest as they often fail to remember the last parts. Again, as a candidate, you have no right to alter the sequence. The interviewers are in charge, and you follow their instructions. There is no room for any arrogance.

3. Be Polite while answering the Opening Question, usually about yourself. Generally, the first question is about yourself (e.g., introduce yourself, describe your achievements, etc.). The interviewers typically throw the ball into your court, thus allowing you to "set the tone." Even if you had aced the SAT and then maintained straight A's in college, do not harp on that string. Instead, politely answer that you managed to "do well" in high school and college, moving on to your college major's specifics, leading to the thesis of your internship. Since your achievements are already bulleted in your resume, there is no need to double down on them. Instead, set a polite tone which will immensely impress upon them, so much so that it will have a serene carry-forward impact throughout the interview. Smart people try to minimize the use of the braggadocios' pronoun "I" and consider its overuse morally hazardous. 

4. Be equally Polite while addressing your "Strengths and Weaknesses". This tends to be a common question for new graduates. Instead of parroting a list of strengths from the Internet, politely specify a handful of diverse and meaningful (mostly related to this job) attributes saying, "These are some of the strengths that have been pointed out to me over the years" or another polite expression along this line. Do not makeup weaknesses to create an answer. Instead, politely and confidently say, "Nothing has ever been pointed out to me." If you make one up, the conversation will take a negative turn, often with a snowball effect. Remember, "Goods well bought are already half sold." The fact that you are being interviewed (and I'm talking about a real management interview, not just an HR interview) bumps your point of origin up to 50 -- it's not 0 anymore. So, continue to ride on the rising positive momentum, without the need for any negative emotions, which may only act to your detriment.

5. Show a very Positive Attitude while Describing your Knowledge and Impression of the Company. This is another general question for the new graduates. As a candidate, you must have this answer well-prepared and adequately practiced. Instead of spending too much time and effort on the company's headcounts, ultra-modern real estates, and global footprints, emphasize on what attracts you about this company: how the company became the best in class; its world-class training program; its perennial growth prospects; its cutting edge marketing initiatives; its top-of-the-line yet highly diverse workforce; its proven and consistent room for growth, etc., but staying away from the obvious like excellent salary, benefits, physical work environments, etc. Refrain from getting bogged down to balance sheet nitty-gritty, holding back all of your questions till the end or until you are asked to do so. Just focus on addressing their issues as politely, precisely, and thoughtfully as you professionally can.  

6. Avoid any Negative Talk/Opinion about your Current or Prior Employers and Bosses. If you completed an internship or held temp/part-time jobs during the college years, do disclose all of them in your resume. If you are asked to talk about them, try to keep the narrative as positive and perfect as possible. Smart people do not enjoy negative talks or tones. If you do, they may sympathize with you superficially, but rest assured you will be pushed down to the list's bottom. We all know life is not a bed of roses, so smart people do not waste time dwelling in the past; they move on and work towards a brighter tomorrow. At an early age, I learned from Lord Buddha to live in the present, which always helped me stay positive and focused. Positive people are inherently more productive and tend to make great corporate leaders. Their positive energy helps create very positive work environments. No doubt, it's a real blessing to work with a perennially upbeat boss.

7. While answering the Main Questions, try to Walk Away from the Herd. Remember, for two or three openings, the shortened list may still comprise twenty to thirty highly qualified candidates. So, while answering the main questions, use your knowledge (depth) and intelligence (ability to get to and stick to the real issue) to narrow the competition. In doing so, whenever you can, try to walk away from the herd, so you stand out -- in addition to conventional thinking, present outside-of-the-box solutions, preferably with the help of some real examples from your internship, work/study programs, etc. Soon, you will be solving enterprise-level challenges, so make an emphatic case in front of them that you are capable of rising way above the occasion and, thus, you rightfully belong there alongside those brilliant minds. 

8. Save the Best for Last. Show off your Mettle with some Awe-inspiring Questions. The primary interview has ended. Now, it's your turn to ask them some questions. Remember, this is the only part of the interview you will control, so it's your time to show off your Mettle. Bang away with questions they have never heard of. Bang away with items that will leave them wanting more. Bang away with things that they will ask one another later. Bang away with questions that will prove you are the super-human they have been waiting for. Anything less will significantly reduce your chances. Whatever answers you get, accept them politely. It's impolite to ask them follow-up questions; instead, move on to the next question. Again, this is not the forum to ask any HR questions. Even if the topic comes up, politely decline it by saying, "If I have any HR questions, I will later contact the HR Department. Thank you anyway." 

9. Rejections must Inspire you to Prepare harder and smarter for Future Interviews. While you should take rejection as a passing show, it must also inspire and impel you to prepare better for future interviews. Steve Jobs used to say, "You can't connect the dots looking forward; you can only connect them looking backward." Every time I was rejected (after having interviewed), I told myself I was not prepared enough to get the job. Then again, I knew quite well the mistakes I made and promised myself I would not repeat them. Of course, one of the best ways to reduce the incidence of classic or run-of-the-mill errors is to allow yourself some meaningful match practice (#1 above). A rejection is not a let-down, rather a reminder of better opportunities ahead, taking advantage of which requires slightly better preparations. You are almost there!

A few years ago, I was (phone) interviewing an overseas candidate for a Senior Analyst position. I was so impressed with the answers that I had to give him a perfect 10. Then it was his turn to ask me some questions. The first question he asked pertained to his work hours. I had no choice but to mark the one off his score. The point is, when you are interviewing for a career job that might lead you to be the future CEO of the company, the last thing you should think about is your work hours. When you are starting in the labor force, you have to be flexible. If you are looking for an 8 to 5 job, you need to redevelop that Mettle.

-Sid Som, MBA, MIM

homequant@gmail.com

Link to the Book