derivative pricing vs algorithmic trading

[JamesClark]

Hi, what are the advantages and disadvantages these days of being a derivatives quant vs algorithmic trading quant in an investment bank?

Which would be better to start off in - is there any possibility to move between the two?

 

[rajanS]

You first need to get a job in either or. Before making decision what is right or not for you. Just my 2 cents

 

[PepeQuant]

I have been both. I can provide some input I guess.

Algo quants are more specialized usually in one but not both of the following

• Execution. This is more developer focused. It is less client facing. Skills: C++/Java
• Analytic. This really depends on your firm. If your firm runs some cool stuff (which is very rare), then it would be interesting. Otherwise you will be doing TCA/Hit Rate/Client report all day. Skills: Q/KDB+, Python, R

Derivatives pricing quant in my opinion is getting phased out. They maintain existing library/product all day and there is not much initiatives for new product. Skills: C++

In terms of the pay, both are good. Pricing quant is way harder to get in so the pay is scaled by that.

In terms of popularity, it is quite straight forward. The more popular the flows product, the better for Algo Quants. vice versa.

In terms of theory, algo quant sux, period.

There is a trend of Scala of replacing java.