Quantitative analysis without graduate degree?

November 10, 2007 11:02 AM

What is the best route to becoming a quantitative analyst right out of college, without a graduate degree? Specifics inside.

I want to become a quantitative analyst. I am about to graduate from a not-very-well-known-but-fairly-well-respected liberal arts college with a degree in mathematics and economics (and a very good GPA, and relevant internship experience). I haven't decided if I want to go to grad school yet, so, assuming that I don't, I am trying to figure out what route I should take to becoming a quant without a PhD or Masters. What kinds of jobs should I be applying for right now for after graduation? Are there any specific companies I should make sure to look into? Within the area of banks and financial companies, what specific types of positions should I be trying for?

Or, if it is your opinion that I absolutely should just go to grad school, feel free to recommend some schools for mathematical/computational finance, financial engineering, or the like. TA positions/grants/scholarship/financial aid are a must.

I am in the US northeast and would prefer to stay there, but I'd be happy to move for a great opportunity.

posted by whataboutben to work & money (5 comments total)

One correction. I am not necessarily trying to become a quantitative analyst "right out of college," rather, I am trying to find out what I should do right after college to ultimately reach that goal.
posted by whataboutben at 11:16 AM on November 10, 2007

Ok, in spite of the stereotype I have run into Quants without Masters or Doctorates on trading desks. I teach part time in the Quantitative Finance program at a University here in London, so I'd start by putting the same question to you as I do students I work with - "What's your market?"

It doesn't matter if you track US cash Equities, Soft Commodities, Interest rates, Currencies, houses, bubble gum cards, whatever; if you want to first enter and ultimately succeed in this business, you have to know a market.

When you interview at a bank for a job (more about that later), the person evaluating you may not know that market, however will be looking to you to explain how it works, what the drivers of valuation are, where that market is now, where it's been where you believe its going to and why.

Finally - and although obvious it's amazing how many folks we'd interview for a job on the desk would miss this - how can we make money in this market? You answer that question correctly, offer up some insight, some original thinking that blows the interview team away, and you'll be given a job on the spot.

In terms of getting into a bank you could, of course, interview solely for front office jobs but I'd advise against that; you'd be going head to head for positions with folks that do have advanced degrees in the subject (and probably know your market as well as you do).

So try for a back or middle office job. And once in a bank, don't only network, network, network but also learn, learn, learn. Take advantage of this wonderful chance to earn while you learn. Many of the back office jobs, for example, Controlling, will introduce you to the instruments at a finer level of parametric and operational detail than a Finance MBA would ever dream possible. You'll know the instruments inside and out, especially so if these same instruments are used in your market.

So now that we've gone through all of that - what is your market? Seriously. It can help myself or others offer more specific advise, either in this thread or privately.
posted by Mutant at 11:57 AM on November 10, 2007 [2 favorites has favorites]

It's at least as hard to get a real quant job without a graduate degree as it is to get a banking, trading or non-quant research job without an undergraduate degree -- that is to say, very hard, and always dependent upon a confluence of a great relationship with the hiring manager and the lack of a doctrinaire credentials policy.

I'd like to put a slight gloss on mutant's suggestion for non-front office strategies: be open to a job which is one step removed from the front office -- i.e., take a back office job only in a shop without a middle office. (Smaller sell-side shops and all but the biggest buy side shops don't have a middle office as such.) Shops big enough to have a full middle office often have huge institutional barriers to moving out of the back office. And, as silly as it is, make sure you're in the building. It's a heck of lot easier for a smart risk-management programmer to get known by the black box gurus on the quant desk if you're three floors away and not across the river in an unfashionable corner of an outer borough (or Jersey!)
posted by MattD at 1:22 PM on November 10, 2007

also, if you don't already, hang out at Nuclear Phynance (a quant site)- they have a well frequented forum devoted to exactly this question (look at "careers" and "university").
posted by patricio at 6:36 PM on November 10, 2007

To answer a tangential question that nobody's answered. If you get into a PhD program, you'll be funded (TAships and RAships, that's "research assistantships"). This is a tuition waiver and a stipend to live on. If you do an MS, you probably won't get automatic funding, but then again, sometimes you can network your way into getting funding for each semester. If you're a PhD student, it's a given; your advisor has to pay your way. If you're not, you're on your own, but some MS students do find ways to get a TAship or RAship, depending on their skills and needs in the department.

I don't have any advice on which PhD or MS programs might suit a future quant so I'll leave that to others.
posted by zpousman at 1:10 PM on November 11, 2007