Average salaries for quants

[IlyaKEightSix]

it's not just some vague idea of humanity or model citizen that i care about. in every university degree that is being offered, there is certain problem that the professors are exploring and trying to help students to solve. and in so doing, the university contributes to the good of the society. but for fe/qf, the problem it is trying to solve is not so obvious, is it? some may say that fe improves market efficiency and helps create instruments to transfer risks. but is that too trivial a task to solve and one day may become automated or standardised?

How about this: good financial engineering allows anyone to take risks or manage risks in any way they wish to. Say you want to hold a stock for one year but want to sell it for at least $35. You then buy a $35 American put option and wham, insured stocks. Now you can hold onto them for a year, and if they drop past 35, you can get out with $35 a share, and if they go higher than that, you make a profit once you pay off the option premium.

Say you wish to speculate on the fact that a new advertising strategy by google will make it go through the roof a year from now. You can buy naked calls, or even enter into forward contracts to do just that.

Financial engineering revolves around the fact that you take some basic building blocks, such as underlying assets and derivatives, and essentially create any sort of investment strategy for anyone on any agenda.

Remember:

Humans are generalists in consumption and specialists in production.
They have unlimited wants and limited resources.

You do not go wrong by putting more money in people's pockets.

If a civvy builds a new building, I won't give a ****.
If a bioE invents a cure for AIDS, I won't give a ****. (I don't have AIDS and hopefully never will)

Know why most engineers don't get paid jack **** compared to financiers? Because the problems they solve not a lot of people give a **** about.

If you're making people money, who doesn't like more money?

 

[Uncle Max]

The rule indicates that what goes up must come down but I have no problem with our salary being the exception to the rule

Rule #1: No rules for quants

 

[Ka Wai]

If product life cycle of quants repeats that of vehicle, it may tell us what will happen to quant salary.

Vehicles started out as luxurious items. Demand overwhelmed supply and privileged group were paying premium for cars to stand out from the crowd.

Ford then mass produced vehicles. Prices dropped and cars with similar qualities flooded the market. A bigger general public were now able to afford vehicles.

The privileged crowd felt underserved by the general model of vehicles. GM realized these markets and started manufacturing customized vehicles for vertical markets. At the end, we ended up with the bargain market for the general public and the customized/luxurious market for the high-end market.

I think it's unavoidable to see quant salary drop before the quant markets diverge...

 

[doug reich]

Salaries in the finance industry have always been high, and will continue to be high. Have you seen investment bankers lately or in the last 200 years? Nobody is selling quant services to a "bargain" market, unless you're talking about mutual funds or index fund composition.

 

[bigbadwolf]

If product life cycle of quants repeats that of vehicle, it may tell us what will happen to quant salary.

...

The privileged crowd felt underserved by the general model of vehicles. GM realized these markets and started manufacturing customized vehicles for vertical markets. At the end, we ended up with the bargain market for the general public and the customized/luxurious market for the high-end market.

I think it's unavoidable to see quant salary drop before the quant markets diverge...

I agree with your argument. The same phenomenon can be seen in the MBA market: there are MBAs from schools like Stanford and Wharton, who command a premium, and MBAs from Swampwater University, who have to take whatever they can get. The same will happen -- is happening -- with MFEs. Until and unless quants can organise themselves as a professional guild, like the American Medical Association, with their own professional standards and certification, and control who and how many can achieve chartered status.

MFE programs have sprouted up all over the place. There will be a deluge of would-be-quants. Columbia has admitted some of its alumni have started on as little as $45,000.

 

[Ka Wai]

...MFE programs have sprouted up all over the place. There will be a deluge of would-be-quants. Columbia has admitted some of its alumni have started on as little as $45,000.

Columbia probably should keep its students in the program than graduating them without job (or jobs with subpar conditions) and risk tarnishing the brand. I have strong impression that it is a school with very good students but a not so good career service...

 

[Andy Nguyen]

It doesn't help that Columbia has many competing programs some with class size of 60+
Add very difficult year for the financial firms and you can start to see the effect on many of mass produced programs.

 

[chrisd]

MFE programs have sprouted up all over the place. There will be a deluge of would-be-quants. Columbia has admitted some of its alumni have started on as little as $45,000.

To be fair, we don't what the job was... maybe it was a bonus/equity heavy job at a start-up. Or maybe they're the high-minded sort and took a government job.

 

[bigbadwolf]

Or maybe they're the high-minded sort and took a government job.

You are joking, of course.

 

[Andy Nguyen]

Look at the UMich salary stat file I posted on the other thread. Some of them got starting salary at $25K. UMich did add a footnote that the low salary are for students got jobs in Asia.
But still, it's not exactly the plan coming to UMich, paying 50K+ for tuition and get $25K job in HK, SG, is it?
Keep that in mind when you think there is a high correlation between high tuition fee and high starting salary. Or there is a correlation if any.

 

[chrisd]

You are joking, of course.

Sort of. I read somewhere (Wilmott, probably) that there were government quant jobs. The entire discussion was framed in the context of the state's inability to attract good quants, namely because they were low-paid. Hence, my inference.

 

[ThinkDifferent]

No. Where it said that?
It said " After 5 years, you can make VP and anywhere from 200K to 500K or more." How you can interpret it to be "500 k in a 3 yr time frame" is beyond me.

sorry, for reviving an old thread....but this made me LOL, esp. for these days......so, any of you guys know people who make anywhere around the above-mentioned range while being employed for 5 years or so?

On a more concrete note, what's you view on 120K USD + 50K bonus for an AVP level quant (3 years experience) middle office quant (model validation).

Screwed / around market rate / overpaid (if there is such a thing...) ?

 

[alain]

On a more concrete note, what's you view on 120K USD + 50K bonus for an AVP level quant (3 years experience) middle office quant (model validation).

Is that your salary?

 

[ThinkDifferent]

Is that your salary?

of course not!! it's someone I know very very well ))

 

[Joy Pathak]

I would be happy if I can get 60-65K base and uncapped (lol) performance based bonus thereafter per quarter or per year, at least till I break to 2-3 year work experience barrier.

 

[Andy Nguyen]

You are paid what your employer thinks you are worth. No more, no less.

 

[Andy Nguyen]

Got this via email, I'll pass along the note in response to this discussion

"Anonymous Post From a Senior Wall Street Executive Who Frequents This Site"

Basically, what I've seen is a lot of people coming into this business for the money alone. In general, those people tend to be relatively unhappy and relatively unsuccessful. This work is demanding and it's stressful. If people don't have a passion for it they will HATE it and make people around them unhappy. As an employer, I'd avoid them like the plague.

Junior people come in at junior comp levels. As they add more value, they get paid better. Entry-level comp should only be a minor factor in job choice - your comp 15-20 years down the line will probably swamp your entry level comp, to the extent that you'll look back and think your worries were silly. Do what you love - the money will follow.

 

[vidyevad]

Salary for entry level quant

Hi,
I am doing MS in applied math at Rochester Institute of Technology and currently looking for entry level quant position. How much can entry level quant expect in NYC?

Thanks in advance!

 

[Joy Pathak]

Got this via email, I'll pass along the note in response to this discussion

"Anonymous Post From a Senior Wall Street Executive Who Frequents This Site"

Basically, what I've seen is a lot of people coming into this business for the money alone. In general, those people tend to be relatively unhappy and relatively unsuccessful. This work is demanding and it's stressful. If people don't have a passion for it they will HATE it and make people around them unhappy. As an employer, I'd avoid them like the plague.

Junior people come in at junior comp levels. As they add more value, they get paid better. Entry-level comp should only be a minor factor in job choice - your comp 15-20 years down the line will probably swamp your entry level comp, to the extent that you'll look back and think your worries were silly. Do what you love - the money will follow.

Lol, once again... Never know who is reading.

 

[ThinkDifferent]

Hi,
I am doing MS in applied math at Rochester Institute of Technology and currently looking for entry level quant position. How much can entry level quant expect in NYC?

Thanks in advance!

didn't you get?? you'll get paid according to what your boss think you worth...and don't even ask about money! or anonymous big shot will avoid you like a plague )

on a more useful note, esp. for IB quants, of course your boss alone will not determine your pay as there are such things as market rate, HR department, also your pay will depend on location etc. etc.

For 1st and 2nd year IB quants it is even easier to estimate as there is not much variation in their base salary.

For example, I know for a fact that in JPM (London) 1st year quants (FO) will start on something around 58K GBP. At the place I work numbers are similar.

For NYC you should expect something like 100K plus/minus 10K.