A few general questions: preparation, quantitative skills and job market

[Dmitrij]

Hey everyone,

I have a few short questions.

I have always wanted to work in Finance and work with (credit) derivatives and other financial products. However, I am not a hard-core quant. While I am quite good at mathematics, it's not my specialty so to speak. I was wondering if there are enough basic quant/general finance positions in the field of Risk Management? Or is a PhD in Financial Engineering a must-have these days to be able to work in this field (mainland Europe)? (I am planning to do an MSc. in Finance (general finance).)

Then another question:

If I use the bionicturtle package, is it still required to order the FRM material from the website? Because signing up for Part I + II, plus ordering the material, and in addition buying the BT package costs a lot. Especially for a 3rd year bachelor student.

Final Q:

I am currently working through Hull's 'Options, futures and other derivatives'. I was planning to work through the whole book before beginning to study for the FRM exams in November. Is this a good thing to do, or is it better to start preparing with the BT package right away? Are the topics covered in Hull's book similar to the topics in the FRM exam or do they differ significantly?

Kind regards,

Dmitrij

 

[Harel]

Hi Dmitrij,

First of all, good luck on the FRM. It is a difficult exam (mostly part I, but part II is not much easier than part I).

Regarding your questions, I can share some of my experience, and I hope you will find what you're looking for.

Credit Derivatives, unlike Equity/FX derivatives, are less intuitive and more quantitative. This is why most of the PhD-level quant are concentrated in the Credit Derivatives market/Hybrid market, due to the true need of robust models and pricing. I know for a fact that PhD in physics/ Financial Engineering is a minimum requirement by some of the major IBs/investment funds.

I work as a quant/trader in the FX/FI market, yet my formal education is BA in economics (with a specialty in finance). Most of the hard-core math (stochastic calc, PDEs, matrices, etc....) I learned from textbooks and on-line tutorials (as well as technical readings/derivatives modeling papers). I find it easier to work as a quant in the FX market (or Fixed-Income, for the same matter) than in the Credit market (due to the complexity of structures built there), although it is (in my opinion) far more interesting. This is why I think you should aim the Credit market, but start in the FX/FI space.

Re your 2nd question, for my L1 exam I read the entire scope of readings assigned by GARP, and felt that it did not have any added value compared to the FRM Hand Book. For L2 I used BT sloely, and felt that it was sufficient for me to pass the exam (furthermore, I think that David's presentations provide more depth than the core readings of GARP).

Re your last question, Hull's book is a truly must for anyone aiming for the derivatives market. However, if you are only looking to clear the FRM, BT is all you need.

Hope I helped a bit.

Harel.

 

[Suzanne Evans]

Hi Dmitrij,

In reference to: If I use the bionicturtle package, is it still required to order the FRM material from the website?...

Please see the following FAQ link: http://www.bionicturtle.com/faqs/category/frm-product/#is_it_sufficient_to_just_take_the_course_from_bionic_turtle

David will chime in for your other questions. Should you have any other questions or concerns, please do not hesitate to ask.

Thank you,
Suzanne