What is a “quant?” Quantitative analysts, or financial quantitative analysts, develop and implement complex mathematical models that financial firms use to make decisions about risk management, investments, and pricing. Part speculator, part logician, a quant aims to reduce risk and generate profits.

There is no standard quantitative analyst job description, and their day-to-day may vary depending on where they work. In general, quantitative analysts apply scientific methods to finance and discover new ways of viewing and analyzing this type of data.

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In the trading world, financial quantitative analysts can offer investors an investment approach that seeks a better understanding of markets in terms of alpha generation, as well as risk management. A typical day may also include educating others on the importance of quantitative analysis and why, if used effectively, it can be more powerful than conventional methods.

Quant skills are useful in industries outside of banking and finance as well. You may also find quants developing risk evaluation for insurance companies or developing pricing models.

Responsibilities will differ according to the employer (e.g., hedge fund vs. investment bank), product focus (e.g., asset-backed securities vs. commodities), and level of expertise. A quant may be required to: 

There are quants who are experts in a specific area — statistical arbitrage, derivative pricing, quantitative investment management, algorithmic trading, or electronic market-making — and quants who play to specific strengths. 

For example, a “back office” quant, such as a quantitative modeler/researcher, may be deeply involved in researching and validating statistical models or generating new financial strategies. A “front office” quant, such as a quantitative trader, could be working one-on-one with traders, designing stock market algorithms, and supplying colleagues with computer-based pricing and trading tools.

Some important qualities quants an possess include the ability to think for themselves and the inclination to always ask questions. They explore paths that few have considered and aren’t afraid to break away from conventional models that other quants might use and favor. 

If you’re interested in becoming a quantitative analyst in the financial field, there are a few steps you might want to consider. You may also want to consider your own educational background. Quants typically work in finance and have strong skills in math and statistical analysis. One example of a pathway towards becoming a quantitative analyst is to:

These steps outline just one potential pathway towards a career as a quant. However, there are many different ways to earn the necessary skills and find a job in this field.

A master’s in a targeted program such as quantitative finance, mathematical/computational finance, operations research, or financial engineering can be a useful degree when pursuing a career as a quantitative analyst. A degree in a related quantitative field such as physics, statistics, or math that offers high-level coursework in mathematical modeling and quantitative techniques might also be a good fit.

A PhD may also be useful depending on the position and employer. Candidates with a PhD are likely to demonstrate the ability to work independently on complex research projects — a valuable asset for large hedge funds invested in ambitious projects.

There aren’t many certifications explicitly targeted at quants. So before you invest in the Chartered Financial Analyst designation or the Certificate in Quantitative Finance , ask your professors and professional mentors if certification will have a measurable benefit to your career.

Offered by the CFA Institute, this credential is geared toward investment professionals. To become a CFA charterholder, candidates must complete an independent study program and pass a three-part exam. In addition, charterholders must meet experience requirements through a combination of education and full-time work experience.

Is the CFA worth it? Some quants, like financial engineers without a PhD who want to boost their qualifications, may choose to pursue the CFA in order to give them an edge over their peers. However, it’s not a universal job requirement for quantitative analysts.

The CQF is a part-time, online financial engineering program targeted at individuals interested in real-world quantitative finance. The content includes derivatives, quantitative trading, insurance, model validation, and risk management.

If you’re fascinated by the finance world and would like a broader set of job tasks, some alternatives include:

You also have the option to pursue academia or research as a pure mathematician or buff up your programming skills to investigate engineering roles. Opportunities for senior-level quants might include:

Last Updated August 2024