quant corporate finance?

[Zeuge]

I've heard this term thrown around but I've never really understood what it really meant. What kind of careers are there in 'quant' corporate finance?

 

[Ken Abbott]

The quants I know in corp fin are typically deal guys with PhDs in the sciences. Think tech venture cap.

I suppose you could also make an argument for some aspects of structuring wrt WACC, etc.

 

[Joy Pathak]

I would have to agree with the above. I almost went into the corporate finance quant area during my internship time. It is actually kinda cool. To give you an example of some exotic deal that one of these teams can do : Say a company is going to open a new factory and they take a loan for it. You might model all their cash flows, run some monte carlos of the prices of the commodity they might be producing in that factory and then if they need some interest rate swaps on the debt for that factory then you will model rates, their CDS prices, stock, etc to figure out how much and how many swaps might be required. If there might be something exotic then you would structure some exotic type of product to help them hedge themselves. Sometimes even before you get to the opening factory part, you might be involved modelling stuff regarding if it would even be worth opening a new factory. Everything is done quantitatively. The team I was looking at had two mfe's and a PhD and did all their modelling in MATLAB. They used to do this for M&A deals too.

 

[TATW]

I would have to agree with the above. I almost went into the corporate finance quant area during my internship time. It is actually kinda cool. To give you an example of some exotic deal that one of these teams can do : Say a company is going to open a new factory and they take a loan for it. You might model all their cash flows, run some monte carlos of the prices of the commodity they might be producing in that factory and then if they need some interest rate swaps on the debt for that factory then you will model rates, their CDS prices, stock, etc to figure out how much and how many swaps might be required. If there might be something exotic then you would structure some exotic type of product to help them hedge themselves. Sometimes even before you get to the opening factory part, you might be involved modelling stuff regarding if it would even be worth opening a new factory. Everything is done quantitatively. The team I was looking at had two mfe's and a PhD and did all their modelling in MATLAB. They used to do this for M&A deals too.

This is definitely something I would want to work with in the future. I would also like to get some info on more quantitative methods of business evaluation. Do you have any good literature to recommend?

 

[Ken Abbott]

Any good corporate finance text will suffice.

 

[zhanghongyu]

Ho...Ho, I think it'me, I'm graduate from applied statistics research center with MSc and got bachlor degree of Optics information,and now I'm working for a venture capital as a analyst and assistant accountant, further more, i write program to calculate different financial rations with c++ and build some financial forecast models for different VC project with Excel. Sound like that? By the more, I try to apply "real option" in corporate financial decision making.

 

[Ken Abbott]

Ho...Ho, I think it'me, I'm graduate from applied statistics research center with MSc and got bachlor degree of Optics information,and now I'm working for a venture capital as a analyst and assistant accountant, further more, i write program to calculate different financial ration with c++ and build some financial forecast model for different VC project with Excel. Sound like that? By the more, I'm try to apply "real option" in corporate financial decision making.

Exactly. This is a perfect example of "quant corporate finance."

The challenge I think, however, is that people arrely recruit for these positions. The people that get them happen to be in the right place at the right time, yes?

 

[kamikade]

I talked to an acturial consultant before and IIRC his job is fit into what you have described. He reviews company expansion plan, model cashflows and determine whether the company uses its assets efficiently. He also determines risk level associated to the project. After all, he works woth other consultants who have experience in investment to determine optimal funding option for the project.
Is this actuatial consultant considered an quant finance?

 

[Lana]

Dear All,
I am fascinated by the quants, quant world! May I ask you about an advice how to proceed to be a junior quant? I would like to switch my career, and I know I can do it. I am a physicist with 8 years after my Ph.D and significant experience in research. I have M.S. in Physics and Engineering, Ph.D. in Physics and Math. from Russian Academy of Sciences. I am pretty good in differentials, math, know Monte-Carlo simulation (but for scientific applications), a bit of C++, Python, Matlab. I have begun preparing myself to be ready for interview, reading books. Took some courses from Stanford/Princeton in Model thinking, statistics, probability, etc. to remind myself about it. But the problem is - nobody wants the worker without an experience in that particular (finance) environment! That does not matter where to apply the math rules - in basic research or in financial industry. Math is Math What do you think about my chances to become a quant? Any advice would be appreciated!
Thank you!!! Lana