In recent years, the number of engineers in the world of finance (for example, investment banks, hedge funds, and insurance companies) has increased quite notably. The reason for this is that engineers possess math and problem-solving skills that are very valuable in areas such as risk management and algorithmic trading. This fairly recent methodology is referred to as quantitative analysis, or ‘quant.’
What You Do
As an engineer in finance, you will use your quantitative skills to perform tasks such as risk calculation, credit valuation adjustments, quantitative programming and development, as well as others. It has also become common to use programming languages such as C++, Python, or Java on a daily basis. In summary, financial engineers apply mathematical methods to the analysis and management of financial problems.
Majors & Classes
Typical majors in the field of quantitative analysis are Theoretical Physics, (Applied) Mathematics, Electrical Engineering, and Computer Science. You will need strong programming skills, and of course a good knowledge of finance. Specific topics that are useful are stochastic calculus and statistical methods.
Financial engineering is a highly competitive career path. Because of this, many positions in the field require a Master’s degree, and maybe even a Ph.D. If this career interests you, be sure to check out Illinois’ top ranked Financial Engineering Master’s Program.