If you have a mind for statistics and a background in finance, you could be the perfect fit for becoming a quantitative analyst. Referred to as the “rocket scientists of Wall Street,” quantitative analysts (quants) are highly trained finance professionals who design and utilize algorithms to predict stock market risks or valuations. Quants play a vital role in creating the pricing system and trading regulations for securities. There’s a strong demand for quantitative analysts to form accurate investment recommendations in today’s increasingly complex market. According to CNN Money, quantitative analysts have America’s 84th best job with ten-year job growth of 41.2 percent. The following is an in-depth look at the thriving career path of quantitative analysis.
What Quantitative Analysts Do
Quantitative analysts are primarily responsible for using mathematical models to assess the performance of certain stocks, bonds, and other securities. On a typical day, quants may be involved in making portfolio suggestions, evaluating historical stock data, studying economic trends, evaluating a company’s financial statements, analyzing commodity prices, preparing written reports, and meeting with investors or company officials. Quantitative analysts usually specialize in either the buying or selling side of securities. As investing becomes more global, quants carefully watch new policies, regulations, and political developments that may impact the health of certain investments. Their findings are then used as a basis for critical investment decisions.
Where Quantitative Analysts Work
Quantitative analysis jobs are heavily concentrated in big financial cities with steady security trading operations, such as New York, Chicago, and London. Quants can be found all over the world giving advice on the pricing and trading of complex securities, though. Quantitative analysts usually work directly for security and commodity brokerages, commercial banks, credit institutions, hedge funds, and insurance companies. It’s also possible for quants to use their brainpower at private companies, management consulting firms, and government agencies, too. Most are employed full-time in a comfortable office setting, but working beyond the traditional 40-hour workweek is common. Travel can be frequent for quantitative analysts to meet with current or potential investors.
How to Become a Quantitative Analyst
Aspiring quantitative analysts will need to complete rigorous post-secondary schooling to develop the deep financial knowledge the job requires. After obtaining an accredited bachelor’s degree in finance, business, or economics, attending graduate school is virtually required. Quantitative analysts usually earn their master’s degree in quantitative finance, financial engineering, mathematical finance, statistics, or another closely related field. Some employers may even mandate a Ph.D. in quantitative analysis for senior-level management positions. Jump on every opportunity to complete an internship because will help develop real-world experience in studying the financial markets. Training in C++, Python, and Java will also be helpful for quants looking for a computer-oriented role in quantitative development.
Overall, quantitative analysts have the challenging job of using statistical tactics to help generate larger investing profits and reduce market risks. Thanks to the rapid growth of hedge funds and increased demand for pricing models among traders, jobs in quantitative analysis are very lucrative. Although the median salary is $78,100, quantitative analysts usually reap plenty of bonuses to make up to $500,000 every year. If you think you have the high intellectual ability to master mathematical domains, analyze abstract financial problems, and raise through the ranks, then becoming a quantitative analyst could be the right career goal for you.
