Getting my hands dirty

[alessm]

I have been an active trader for 2 years, yet when faced with the prospect of applying to grad school I get weak at the knees, I just never feel that my knowledge of how the market works is adequate.

I hold a degree in Electrical engineering, and although I have become increasingly interested in trading systems, my trading approach is discretionary.

My question is, how do I get my hands dirty in all that lovely math, before I commit myself to an MFE? Where exactly do I start, and what is the most practical approach?

Thanks in advance.

 

[Andy Nguyen]

It's like a call option. You can't never lose more than the premium. Depends on where you buy your option from, it can cost you handsomely.
You want to test if you can handle the math before you join an MFE program right? Your best bet is to get a math book, do all the homework, check the answer to see if you get it all right.
One book comes to mind is by Prof. Dan Stefanica. I suggest this book because it's actually being used in the refresher course of Baruch MFE program. You can also check the answers right here on Quantnet.
Get the book at Financial Engineering Press or on Amazon
For about $40 buck, it's very inexpensive way to find out before you jump into MFE.

 

[Prashant]

You can also look at the math prerequiste at all the MFE programs. Baruch has an online test that you can take (which has questions similar to the GRE) and Columbia has a pdf with some problems in integration, linear algebra...

 

[Sanket Patel]

I'd agree with the recommendation of Andy and Prashant.

Additionally, a quick and dirty way to gauge your current 'math-level' would be take the practice GRE Math test. You can download the sample test here

The test consists mostly calculus and algebra, with a small number of questions covering set theory, graph theory, analysis, topology, logic, and combinatorics. While some of topics are of little to no relevance in FE, the test is a fairly good indicator of the level of math required to gain admission into most FE programs. You should note, however, that the material falls into the "minimum" category. But the level of math utilized in an FE programs will far exceed anything on the test.

 

[DominiConnor]

The guy running the Baruch program has written a book http://www.amazon.com/Primer-Mathematics-Financial-Engineering/dp/0979757606/ref=pd_bbs_sr_1?ie=UTF8&s=books&qid=1210840549&sr=8-1

This will not only refresh bits of maths you may not have used for a few years, it should be a good reality check on whether you really will benefit from a MFE course.

 

[alessm]

Thank you all for your direction, I will definitely be looking into reviewing my mathematics.

From a practical stand point, how would I be able to approach my trading with MFE concepts?