Finance vs Quantitative Finance

[Distressed]

Hello, I am a high schooler was is really interested in both traditional investing(fundamental/qualitative techniques) and quantitative investing. I have heard many people say that fundamental investing is going to die and that quants are going to take over, I wanted to know if you guys think this is true and if I should focus more on developing my quant skills because in the future there will be very less traditional investing jobs. I also wanted to know if the quantitative finance degree from stevens leads to great quant research jobs at hedge funds or if it would be better to double major in finance and comp sci from Rutgers, thanks.

 

[IntoDarkness]

stevens or rutgers??? princeton is a better school in nj. aim for that

 

[Distressed]

stevens or rutgers??? princeton is a better school in nj. aim for that

Yeah that is my first option but not 100% sure on getting in, do you think quants are going to take over all public markets jobs?

 

[Andy Zhang]

If you want to work in quant research at a hedge fund, I think Princeton (of all schools in NJ) is the absolute best bet by far. I've seen Princeton undergrads get into Citadel or Two Sigma, but none from Rutgers or Stevens.

 

[statquant]

I set my goal to work in quantitative finance when I got into graduate school. I'm in this field now and I don't feel it as wonderful as I expected. In retrospect, I regret I set up the goal too early. There are lots of possibilities and unknowns for you to explore in the coming years. It's okay to be interested in that field and dabble in it. Just don't set it as your only goal. My 2 cents.

 

[Distressed]

Do you guys think that quantitative investing will take over fundamental investing? I hear a lot of people saying this but am not completely sold on it and want to know as many peoples opinions as possible.

 

[bigbadwolf]

Do you guys think that quantitative investing will take over fundamental investing? I hear a lot of people saying this but am not completely sold on it and want to know as many peoples opinions as possible.

Fundamental investing is dead and has been since at least 2008 (maybe even earlier). As for "quantitative investing", that's a misnomer. I'm not even clear as to what it means. I don't know who has been filling your head with this drivel.

 

[Distressed]

Fundamental investing is dead and has been since at least 2008 (maybe even earlier). As for "quantitative investing", that's a misnomer. I'm not even clear as to what it means. I don't know who has been filling your head with this drivel.

I meant to say quantitative trading not investing.

 

[RowYourBoat]

What he means is that investments nowadays are always made based on quantitative evidence. Hedge funds don't just go out and buy 100k shares on a hunch like you see on TV.

At the undergrad level a finance major teaches you mainly corporate finance (valuing a company, taxes, accounting) and basic quantitative investing up to modern portfolio theory. A quant finance major skips the corporate finance stuff and will probably go into time series, stochcal and operations research

 

[noether-skolem]

I think you should focus on the skills, e.g. if you go down the traditional finance path, other than non-quant hedge funds you can also do M&A, private equity. On the other hand if you go down the quant finance path and improve your programming skills you can also do software development at tech firms or do data science stuffs at non-finance firms.

On the topic, I don't think non-quant hedge funds are dying. They may adopt more sophisticated techniques for valuation/risk management, but many funds still rely on discretionary investment decisions made by the portfolio managers. I can't say if this will remain the same in the future though.

 

[mspinoza]

I set my goal to work in quantitative finance when I got into graduate school. I'm in this field now and I don't feel it as wonderful as I expected. In retrospect, I regret I set up the goal too early. There are lots of possibilities and unknowns for you to explore in the coming years. It's okay to be interested in that field and dabble in it. Just don't set it as your only goal. My 2 cents.

If you wouldn't mind, it would be great to hear your thoughts on the field and why it hasn't met your expectations. Many of us are thinking of entering grad school this year, so it would be great to enter with an informed opinion. Thanks!

 

[BucaroQuant]

Hi, wondering what you ended up choosing...I am also deciding between Rutgers, Fordham, and Stevens....any thoughts or insight would be greatly appreciated!

 

[MoraloEval]

Fundamental is not dying at all. Most of the capital/risk at funds like Citadel, Millennium, Point72 is allocated to discretionary strategies. Even DE Shaw is investing a lot in its discretionary L/S business.

I would pick Fordham, they seem to punch above their weight class in terms of finance recruiting.

 

[BucaroQuant]

Fundamental is not dying at all. Most of the capital/risk at funds like Citadel, Millennium, Point72 is allocated to discretionary strategies. Even DE Shaw is investing a lot in its discretionary L/S business.

I would pick Fordham, they seem to punch above their weight class in terms of finance recruiting.

Thanks!

 

[seamusfinnegan]

What would say is the difference between headcount in fundamental vs systematic hfs?

 

[MoraloEval]

That's a good question, I would say roughly similar? Perhaps slightly lower headcount for fundamental, as you don't need as many coders to build infrastructure.

 

[Larssen]

There is a lot of accounting tricks to smoothen the numbers, and I highly doubt any computer based system can pick on those. Traditional finance ain't quite dead yet, you also need to analyze where the numbers come from.

I'll recommend a great book on those tricks:

Financial Shenanigans: How to Detect Accounting Gimmicks & Fraud in Financial Reports