• C++ Programming for Financial Engineering
    Highly recommended by thousands of MFE students. Covers essential C++ topics with applications to financial engineering. Learn more Join!
    Python for Finance with Intro to Data Science
    Gain practical understanding of Python to read, understand, and write professional Python code for your first day on the job. Learn more Join!
    An Intuition-Based Options Primer for FE
    Ideal for entry level positions interviews and graduate studies, specializing in options trading arbitrage and options valuation models. Learn more Join!

Rutgers to Launch Third Quant Master Program

When Marc Fields, sales executive at a financial services firm, got accepted into one of the two master programs in quantitative finance at Rutgers University earlier this year, he was still unsure of the differences between them: "After being accepted (into the MQF program) I discovered the MSMF program at the New Brunswick location through the Math department. I was a little shocked at this discovery especially after looking extensively at Rutgers. Upon further investigation I still couldn’t make out the difference between them and which one would have been the right fit."

A quick look at similar questions on Quantnet's forum shows Mr. Fields is hardly alone. Next year, aspiring applicants like him will have a harder time making a decision between available options at Rutgers.

On Dec 16th, 2010 Rutgers University Graduate Faculty Council gave the go-ahead to the Department of Statistics and Biostatistics’ new graduate program, titled “Financial Statistics and Risk Management” (FSRM). The program will begin admitting students in the Fall of 2011. The department has been working for the past two years to create this new program (website).

Response to news of the launching FSRM has been ambivalent, to put it mildly. At least two directors of quant master programs in the New York area were in disbelief when apprised of the fledgling FSRM program. Paul Feehan, director of Rutgers’ Master of Mathematical Finance (MSMF), released an official statement to Quantnet on behalf of his program strongly objecting to the launch of the new program: “The establishment of a third program, in what is generally viewed as a single field at the master's degree level, is not in the best interests of the university or its students.”

"If there were three options within Rutgers for quant programs I would have been very confused. It is hard enough to define financial engineering programs between different schools, but to have three programs within one school seems to add another layer of complexity to the problem." - said Mr. Fields when told of the new program.

The FSRM and MSFM (website, review) programs are both housed in Hill Center, Busch Campus – in New Brunswick/Piscataway.

FSRM is Rutgers’ third entry into an increasingly saturated market. The Master of Quantitative Finance (MQF), the other quant master program out of Rutgers’ Business School, is based in Newark, NJ.

When contacted by Quantnet, Rong Chen, Director of the FSRM program, told us that his program was created “to address the increasingly strong demand for specific training in statistical and data-oriented techniques that are widely used and help to drive success in the financial industry.” And there is some plausibility to this argument: in a Quantnet interview with several Wall Street managing directors, one executive at a top investment bank commented that MFE graduates tend to be strong in programming but relatively weak in statistics. This executive has been known to push for more statistics courses in several quant master programs where he has been teaching as an industry practitioner.

"We believe that there is a strong demand for well-trained master's level employees with a solid methodological foundation and practical skill set in financial statistics and risk management. Indeed, especially in this economy, we believe that these skills will give our graduates a considerable edge in career opportunities. We expect to place our students well." - said Mr. Chen. His program is expected to enroll 20-40 students in the first few years and more as it matures. All core courses will be offered in the evenings to accommodate part-time students. On its website, the program is posting a job position for an Associate Director of Administration who will manage daily operations as well as job placement for students.

How would applicants like Mr. Fields decide which to study when faced with choice of MSMF, MQF or FSRM?

"Obviously, I would have been unsure of the differences of each program and which program would better suite me for my career objectives. Aside from the differences in course load it would be good to know how the faculty and recruiting differ among the different options. It would also be great to know how the street views each program but that is a little harder to quantify."- said Mr. Fields.

"I don’t want to assume that Rutgers or any school having three quant programs it necessarily bad but the school should make it abundantly clear what the differences between the programs are and market them as so. I think it’s a little ambiguous right now especially when there seem to be 10 new programs popping up everyday around the country. If you are creating a new program you have to explain how you will get your graduates jobs and how you differentiate and compete with similar programs.

Mr. Chen has a quick answer: "The graduates from the FSRM program will be able to take immediate employment as financial statisticians and risk managers. Students who are interested in mathematical modeling and stochastic differential equations should consider the MSMF program, and students who are interested in becoming financial managers should consider the MQF program. The FSRM program is most suitable for students who are interested in statistical methods, analyzing large financial data set, identifying statistical arbitrage opportunities, proprietary trading strategies, stress testing, and risk management."

Even so, this industry desire for people with more statistics under their belt may not necessarily translate to a successful launch for Mr. Chen’s FSRM program. As Paul Feehan makes clear, no other university offers three similar programs: other universities tend to concentrate their limited resources into strengthening the one program choice they do offer."

As if on cue, Columbia University’s Business School recently announced that it will offer a master’s degree in Financial Economics. Its website promises students “analytical jobs with potential employers such as investment and commercial banks, asset management companies, consulting firms, and policy-oriented organizations “.

“The existence of three quantitative finance master's programs at Rutgers would confuse applicants, employers, and external program reviewers responsible for rankings”, Mr. Feehan of Rutgers’ MSMF said in the program’s response. When it comes to ranking and confused external reviewers, he has first hand experience. When AdvancedTrading, an industry magazine, released its "Top 10 Quant Schools" ranking in 2008, it listed both Rutgers MSMF and MQF programs. But according to our conversation with one person involved in the ranking, only one of the Rutgers program was submitted to the magazine. When AdvancedTrading mistakenly put the other Rutgers program in its ranking, instead of acknowledging and correcting the mistake, it decided to put both Rutgers programs on the list. As a result, there are 11 programs in its "Top 10" list.

Aside from the confusion for applicants, universities offering competing programs inevitably face the perception that they are trying to cash in on the applicants, many of whom are international students who pay $50,000 or more for a master's program. This perception may not be of vital significance to cash-strapped Columbia University, for example, which offers a Master of Financial Engineering (MFE) in the IEOR dept as well as an MA in Mathematics of Finance program, jointly offered by the Dept of Mathematics and Dept of Statistics: the MAFM program, perceived as inferior to Columbia MFE program, still managed to draw over 800 applicants for its Fall 2010 incoming class. Rutgers, however, does not have the Ivy League cachet or the New York City location advantage to attract domestic applicants, an increasingly prized group courted by programs new and old.

That issue was clearly on Mr. Fields's mind has when he spoke candidly to Quantnet.

"My biggest concern with any program is the recruiting aspect. As more programs are created it makes it harder for recruiters to differentiate candidates and the programs they attended. Once this happens they will start to resort to looking at the school name as their basis for quality rather than the intricacies of the course load. Rutgers was able to get a top ten ranking and give it some validity which is great, but they should have taken that and run with it. Rather than increase class sizes and developing alternate programs they should have spent their resources developing their current programs and making sure that they continued to get mentioned and compete with other top 10 programs."

"I would be much more comfortable with Rutgers granting one, maybe two, financial engineering degrees but having different concentrations. That way students who are math, statistics, or finance focused can still tailor their course load accordingly but not dilute the Rutgers reputation or make Rutgers split up resources."

The competition that the FSRM will encounter from well-established programs will doubtless be fierce in the years ahead. The tri-state area is home to many of the oldest and largest quant master programs. Established programs like Carnegie Mellon’s Computational Finance (CMU MSCF) and Cornell University have set up remote campuses in NYC at 55 Broad Street. Baruch College, Columbia University, and NYU’s Courant are three other well-known programs in the city offering competing programs.

Mr. Yangru Wu, Director of the Rutgers MQF program (website, review), told Quantnet that his program does not share resources or collaborate with the new FSRM program at the moment. Mr. Chen sees it differently: "FSRM is closely collaborating with QFM program at Rutgers in sharing resources, including courses, financial data and joint activities."

Besides sharing the same building, students in the MSFM and FSRM programs will likely see more of each others in the near future, Mr. Chen predicts: "We are also working with MSMF program to provide better learning experiences for the students in both programs. For example, for the three statistics courses that MSMF students are required to take, we will create special sessions exclusively offered to FSRM and MSMF students with extensive training in finaicial applications and enhanced instruction and learning support.

"The statistics department has been teaching courses as a part of the MSMF program since its existence and will continue to do so. We look forward to developing deeper connections with MSMF and MQF in the future, in order to further take advantage of common resources and build a broader community for quantitative finance at Rutgers" - said Mr. Chen.

Tuition for FSRM has not been finalized but should be similar to those of MSMF program, according to the program's website. Current tuition rate for MSFM program is $839/credit (residents) and $1,314/credit (non-residents). At 30 credits, total tuition would be around $25K for residents and $39K for non-residents. For comparison, tuition rate for the Rutgers MQF is $877/credit (residents) and $1,446/credit (non-residents). Tuition for the 48-credit MQF degree will be $42K (residents) and $69K (non-residents).

At Baruch College, part of the public City University of New York, tuition for residents is only $11K and $22K for non-residents. At private universities in the area, a MSMF degree from NYU Courant would cost $52K while at Columbia University, students pay $52K for the year-long MFE degree or $39K for the 2-semester MAFN program.

A New Jersey native, Mr. Fields recently moved to New York City and decided to pursuit an MBA from Stern instead of the MQF degree. Explaining the change of heart, he said: "At the end of the day I thought that an MBA and CFA designation would be a better fit for me. My career goals have shifted over the past couple years and I think to be competitive, my time and resources would be better spent getting an MBA and CFA. Additionally I believe the Stern reputation and recruiting is an advantage over either of the Rutgers programs"

Speaking of his brief time in the program, he said: "I had only studied at Rutgers MQF program for one full semester and a summer session before switching to Stern, so my experiences should only be taken in context of my exposure to the program. I really enjoyed the Rutgers MQF program and thought that it was heading in the right direction. There are many qualified students studying there and the faculty and staff seem dedicated to providing a valuable education."

APPENDIX A: RUTGERS MSMF PROGRAM'S RESPONSE TO THE CREATION OF FSRM PROGRAM
APPENDIX B: RUTGERS FSRM RESPONSE TO MSMF PROGRAM'S COMMENT
 

Attachments

  • Rutgers MSMF response to the introduction of FSRM program.pdf
    21.1 KB · Views: 90
  • Rutgers FSRM reponses to quantnet.pdf
    13.7 KB · Views: 97

alain

Older and Wiser
I need to see the complete syllabus (there are some broken links in the site) but, after thinking about this for a while, it could be a good thing. I don't think the other programs at Rutgers cover Statistics in Finance. The only thing that worries me is... why didn't the people at Rutgers get together to figure out a better plan than to offer 3 different programs?
 
I just added this piece of tuition comparison to the article so people can compare them at a quick glance.


MQF in Newark (requires 4 semesters/48 credits):

NJ resident:
$10,520 fulltime, or $877 per credit
Non-resident:
$17,341 fulltime, or $1,446 per credit

So, this degree costs about $42k for NJ residents, or $69k for non-residents.
-----------------
MSFM in New Brunswick (requires 2.5 semesters / 30 credits):

NJ resident:
$10,068 fulltime, or $839 per credit
Non-resident:
$15,768 fulltime, or $1314 per credit

So, this degree costs $25k for NJ residents, or $39k for non-residents.

Presumably FSRM will match the MSMF prices


-----------------
In contrast, the Columbia MAFN can be done in 2 semesters for $38k while the Columbia MSFE takes a full year and costs $52k.
-----------------
Likewise, the NYU Courant degree takes 3 semesters and costs $52k.
-----------------
At Baruch, tuition is $325 per credit for NY residents and $605 for non-residents, making the entire cost of this 36-credit program about $11k for NY residents and $22k for non-residents...
 
A comment left on the LinkedIn's Quant Finance group discussing this topic

As a working quant and former student in both MSMF and Statistics programme at Rutgers. I have to ask the question whether the department of Statistics has the right financial industry experience to host such a programme. I have had classes with half of the people of the teacher list and hardly any has experience with real world financial data. I also have strong opinion regarding the programme director but that is another question. Many of them are prominent researcher in biostatistics, data mining, etc but not in finance/econometric.

To paraphrasing Rong Chen, the quant on the street is lacking working knowledge in financial statistics which I agree. However, the requirement of the MSMF(math department) degree requires roughly 4-5 statistic classes for completion which I think are sufficient in the foundation of Statistics. The new programme requires 7 statistic classes (which I have taken all) and none were financial focus 2 years ago. It also seems to me that this programme does not focus on Black-Scholes economics which is essential to modern quantitative finance. From the structure, they might be focusing on GARCH, MVO, Sharpe Style analysis, which I think is rather smaller and simpler topics in modern quantitative finance. There is no sound reason to create a new programme with 2-3 addition statistics courses.

Don't get me wrong that I am trying to market MSMF programme in the Maths department. However the objective of this new programme looks more like a project proposal to impress the boss and himself, and hurt the rest of the company.
 
any update about FSRM program, How is the stats for job placement and internship ??? any feedback from recruiters/industry?
 
Top