Investment actuary to quant?

[J Warren]

Hello all, first of all I would like to thank you in advance for your advice. I'm an undergrad student (majoring in Finance with a minor in econ, I started out as a physics student) at a reasonably respected state college and I've begun my path towards becoming an actuary, and I'm starting my exams. I really like the idea of becoming a quant and I think it is something I would like to pursue. The problem is there's just no way my parents and I can afford to send me to any of these amazing Phd and MFE programs I read about. What are my options here? Suck it up and work in the actuarial field then try to go back to school? Or is there a way I can take the Investment Actuary track and use that accredidation to jump ship? I would very much appreciate your input, thank you for your time.

 

[Connor]

I don't know your background but strong math is needed as a quant.

And depending on where you live you may need to relocate for a MFE or even a job in finance anyway.

While you shouldn't pursue a PhD for the sole purpose/plan of becoming a quant, many PhD programs fully fund their students.

Working while you prepare for a MFE or quant job is not a bad option, but from my limited understanding the actuarial exams take many years. For some reason I have 5-7 years in my head, hopefully someone else can correct me.

 

[APalley]

For some reason I have 5-7 years in my head, hopefully someone else can correct me.

That's correct (on average), although some can do it in 2-3 years.

The associate level exams (P, FM, MFE, MLC, C) require a similar level of mathematics that a student finishing the first semester or two of Quant courses (at least based on Baruch's curriculum) will have (I have taken the first two exams, and studied for the 3rd).

However, the associate-level actuary will lack the rigorous/theoretical understanding of the mathematics that a Quant will pick up in school. Even an actuarial fellow (investments track) will not necessarily have the same exposure as a Quant on account of the later exams being very application/business-based and not as quantitative as people believe.

Moreover, there is no coding requirement for actuaries -- unless you get it through job experience you will be at a significant disadvantage. I can tell you from first-hand experience that most actuarial jobs merely utilize VBA, and some database (SQL) knowledge. Very little C++, which is the bread-and-butter of the Quant.

 

[J Warren]

I see, I will look around and a bit further on in my studies and see if there are any grad school programs that are willing to fund my continuing education. Relocating is really not a problem for me, neither is the math as of yet. Thank you very much for your advice.

 

[olgenue]

Hi J Warren,
there are also opportunities that blur the boundaries between actuary and quant. For example, recently structuring teams within investment banks are hiring people with actuarial/financial engineering backgrounds to structure products to meet the needs of life insurance companies.
Within life insurance companies themsevles, some actuaries have equipped themselves with MFEs to move into asset-liability management positions where they model interes-rate risks among other things.
I agree with Connor in that many PhD programs provide full funding for their students.
There are also more affordable and excellent MFE programs like Baruch's.
If you do not want to endure through 4 to 5 years of PhD work or can't afford expensive MFE programs, there is always this option of getting a related Master's in Applied Math where you get to learn advanced math and also programming.