An internship at the center of the financial universe
Senior Mohit Verma talks about his 'intense' summer at Standard & Poor's
Internships are a valuable part of a college education, offering students the kind of hands-on experience you can't find in a classroom.
But how many interns can say they arrived at work one day, only to be greeted by an airplane flying around the building, pulling a banner that read, "YOU SHOULD ALL BE FIRED!"
Mohit Verma knows.
The Stony Brook University senior interned this summer at Standard & Poor's, and found himself at the epicenter of the financial world on August 5, when — three days after Congress passed the Budget Control Act of 2011 — S&P downgraded the United States' sovereign long-term credit rating from AAA to AA+.
"The next morning after the downgrade there was so much security outside [S&P headquarters]," said Verma, who is majoring in both information systems with a specialization in business and economics, and applied mathematics and statistics. "People were really mad, and I was scared even to wear my ID to work, I put it my pocket."
It would prove to be an extraordinary internship, in more ways than one. Having interned the previous summer at Morgan Stanley, Verma had several other internship offers this year, including Amazon and Computer Associates, as well as other investment banks. But the opportunity to work at Standard & Poor's was unique.
"When you go to Yahoo Finance or Bloomberg, you see three things: Dow Jones, Nasdaq and the S&P 500," Verma said. "Before, I worked in an investment bank that was working in the financial markets, and now I'm in a financial service firm that is the face of the market."
Verma interned as a quantitative analyst in the Fixed Income Indices Group and worked on several projects, including rebalancing. Verma noted that securities must adhere to a series of methodologies to remain in an index. Rebalancing is the process undergone as stocks move in and out of an index.
On the software development side, Verma also worked on building the user interface (UI) for the index calculation engine. "They gave me set deadlines to complete the project and I had to work overtime," he said, noting that for the UI project, he needed to first learn how to use the Google Web Toolkit.
"I had to start from scratch, and had many sleepless nights," Verma said. "But it gave me the confidence that I can solve any problem myself. "
When the news broke of the credit downgrade, Verma said everyone received an email from the CEO explaining the firm's rationale, but he and other S&P employees were too busy to wonder about the fallout. "The downgrade sent shockwaves throughout the stock market, and the index calculation engine was running tight because of the volatility," he said. "We had to be on support, because the situation was pretty intense."
Dealing with confidential information and working on critical systems sounds daunting, but Verma said his academic experience at Stony Brook proved to be invaluable. "My majors gave me this combined knowledge of software as well mathematics, and the mathematical knowledge helped me understand the functionality of the financial markets," Verma said.
The S&P internship also led to two other rare opportunities. Verma is currently a student ambassador for McGraw-Hill Education, helping advise its companies on what students need and promoting those companies at campus events. (McGraw-Hill is the parent company of Standard & Poor's.)
Verma was also accepted, with sponsorship by S&P, into the executive program at MIT's Sloan School of Management. He is one of the only undergraduates in a program where his classmates are primarily CEOs, CFOs and other executives.
"I think there is a chance I can make some pretty good connections," Verma said. "And it is a great opportunity to get a degree from such a prestigious institution."
Verma plans on completing the program by the time he graduates from Stony Brook in December 2012. After that, he said he plans to build software for the financial industry, developing "high-end software that underpins the world's financial systems."
Verma said the internship at S&P was more than he could have asked for. "To be on Wall Street every day, learning so much,was just an amazing experience," he said. "My learning wasn't limited to understanding a single business unit of an investment bank. It helped me deepen my knowledge of the financial markets. Everyone wakes up in the morning and sees the index — we are the ones calculating that index. Everybody is trading on that index, making money off that index. It was a big responsibility."
As for playing a small part in one of the biggest events in the history of finance, Verma says he was "really lucky to be there."
"To be there while that was going on, the whole experience was amazing," he said. "I hadn't even turned 21, I was given a chance to work on some amazing projects … it was a really great opportunity for me. I didn't expect anything close to this."
- Michael Gasparino