Do I really want to be a Quant? Am I on my way.

[DirkPitt]

Hi everybody. I just stumbled upon quantnetwork and this is my first post. I am a sophomore at an Ivy league school. I'm majoring in Math modified with economics, possibly minoring in history and/or computational methods (comp sci minor concentration). Basically, I will graduate having taken high level math, micro, macro, a two term finance sequence, basic java programming and, most importatnly, two math classes that focus on arbitrage-free pricing, binomial tree models, Ito calculus, the Black-Scholes analysis, Monte Carlo simulation, pricing of equities options, hedging, stochastic calculus, Radon-Nikodym derivative and change of measure, Girsanovs theorem, the Martingale representation theorem, interest rate models (e.g, H-J-M, Ho-Lee, Vasicek, C-I-R), interest rate derivatives, interest rate trees and model calibration, and credit derivative, etc...

I'll graduate with a competative (3.5+) gpa and tend to test very strongly across the board (2320 SAT). I have some strong extracurriculars and will probably end up with 2 meaningful finance internships.

I am interested in finance, and I am evenly balanced in the humanities and hard sciences, but can handle the quantative rigor required.
I am pretty sure I can find my way into an MFE program, but I have a few questions about them and the whole career path.

1. I am also a very humanities minded person. I love history, I speak and communicate well. I enjoy working with people and have some charisma. Will being a quant waste this? Are quants shunned in cubicles and working with computers all day? Would I ever have hopes of trading or moving to higher, more generalized positions?

2. Would I be a competative candidate for MFE programs? Is a Phd preferable?

3. How can I improve my chances at success? What should I try to take? How much comp sci do I need?

4. Compared to undergrad corporate recruiting and entry level i banking, how do salary, lifestyle, sanity, etc. compare to those recruited out of MFE programs?

5. Do MFEs take straight from undergrad?

Sorry this is kinda an overwhelming post. . . I'd appreciate any help thank you all.

 

[daleholborow]

While I am rolling my eyes about your DirkPitt label , I'd suggest you check out the quant career guide put out by Dominic Connor, search this forum (or wilmott) for information on how to get a copy.

 

[DirkPitt]

Hey, better Dirk Pitt than Dirk Diggler...

Thanks for the recommendation. I looked at the guide, and it is very helpful for career information. However, i think it misses out on my main question and that is the quant lifestyle: personal interactions, hours, pay, exit opportunities.

Point is, five years out will i be the guy sitting at a computer 12 hours a day in the corner making 100k or could I be a trader or somebody who can combine quantatative knowledge with personal skills and a macro view? How many quants go off on their own? How long do they usually wait.

Ihatetheideaofhavingaboss...

 

[Andy Nguyen]

Ilikeworkinginmypijama
You certainly can open your own hedge fund and hire people to work for you. All you need is some good record of PL, some unique proven method to make money. Sounds easy, eh?
I don' t think working in a technical capacity prevents you from being someone a few years later. Most successful hedge funds are technical in nature so the quant stereotype (whatever it may be) is a bonus.
And don't forget that the technical skills you learn can be used for your own gain if you want to do trading on the side (make sure you talk to Compliance dept if you go this route).

 

[DirkPitt]

Thanks, Andy. Not to be an idiot, but what's PL?

 

[IlyaKEightSix]

Profit and Loss.

 

[GoIllini]

Hey, better Dirk Pitt than Dirk Diggler...

Thanks for the recommendation. I looked at the guide, and it is very helpful for career information. However, i think it misses out on my main question and that is the quant lifestyle: personal interactions, hours, pay, exit opportunities.

It really, really depends. One of my coworkers who was in my analyst class works 50 hours a week helping clients model portfolios at the firm. He's not rolling in cash (he's richer than most 24-year-old New Yorkers), but he has a very nice life.

Another friend who's twenty-four makes close to seven figures on the trading floor. Right now, he looks like he's 35 and has probably lost 10 years off his life expectancy. (Financial crises do that to a person on the trading floor.) If you don't get why almost everyone over 23 would prefer to be the quant who works 50 hours a week, you'll understand when you notice your first wrinkle or tuft of gray hair. (This will come sooner than you think- maybe even before the end of college.)

Point is, five years out will i be the guy sitting at a computer 12 hours a day in the corner making 100k or could I be a trader or somebody who can combine quantatative knowledge with personal skills and a macro view? How many quants go off on their own? How long do they usually wait.

1.) If you know a quant with a graduate degree who makes $100K/year, please let me know if he is willing to work 40 hours a week as a financial programmer for more money.
2.) Quants have nice lives. IT guys like me would prefer to have their lives over those of traders. Less uncertainty, stress, and work. Bear in mind that once you graduate, you have to work 50 weeks a year. 80 hours/week wasn't a big deal in college when you got summers off; 80 hours/week for three years straight is tough.

Ihatetheideaofhavingaboss...

1.) Traders have bosses. (Book owner, risk manager, compliance)
2.) Hedge fund managers have even more bosses. (Clients, the SEC/FERC/CFTC, prime services lenders).

If you want to be your own boss, follow this rule to get there the fastest:

Work hard, live modestly, and save everything you can.

It will take ten years, but if you have a modest lifestyle, you will be able to save up enough to start your own business at that point.

More on the other benefits of the non-banker lifestyle in a later thread, if necessary.

One other note:

After about two or three years in the same place, at least in the IT world (I'm pretty sure this is true for the quant and research world, too), it gets a lot more painful for your firm to fire you. Chances are, you're responsible for a system that costs millions of dollars if it goes down but nobody else knows how to fix. At this point- especially if you're underpaid relative to the market- you get to act like your own boss. Your boss understands that it's your job to do X, Y, and Z, you've been doing it just fine for two or three years, and his job is just to keep the problems out of the way so you can do your job.