UK
End of the road for quants
24 February 2009
What’s a PhD with a bias towards quantitative finance to do? Banks have gone from screaming from the rooftops that they want quants, to whispering that they're only interested in a select handful of them. This leaves a lot of people on the sidelines.
Quant recruiters (several of whom seem to have disappeared from the face of the earth) all agree that it’s fresh PhDs who are suffering most. “In this market, banks only want people who already know the models they’re pricing and can do the job straight away,” says one.
“It’s pretty ropy at the junior end,” agrees Leon Devereux at NJF Search. “Most banks have completely shut up shop for those kinds of hires.”
Senior quants are also suffering, with most desk head positions already full. The few jobs that exist are apparently for mid-ranking quants (2-4 years’ experience) and at houses no one’s heard of.
“If you’ve heard of the firm, they’re not hiring,” says Dominic Connor of P&D Quantitative Recruitment. “Most big banks have got hiring freezes.”
There is some quant hiring action though. Connor say there’s need for quants to work on ‘model validation’ in risk teams, although with fewer models being built there’s less of a need for this than in the past.
Consultancy firms like KPMG are also said to be selectively hiring quants with a view to winning mandates from the Treasury. According to one consultant, the government will have a substantial need for quant skills sometime in the near future.
“They are quietly laying the foundations to plans to build a bad bank, probably out of RBS,” he says. “They’re going to need people to price and manage all this stuff.”
Failing that, one recruiters says there are a few jobs in hedge funds. “There’s a need for PhDs to work on systematic strategies and algorithmic trading models,” he says. “But funds want people experienced with dealing with noisy high frequency data sets, rather than the physicists and stochastic calculus experts previously sought after by banks.”
2cents:
1.)
When there is a profit everybody talks about how much money traders earned.
When there is a loss everybody talks about how much money quants lost (i.e. how inaccurate models are).
Bear in mind that decision is made by traders. These have upside and take big risk margins.
2007-8 was about: "Lets win this deal !"
Price was relevant, risk was important but irrelevant in this case.
2.)
Bosses started hiring quant devs rather than quants.
Yes, there is distinction, quants are skilled in finance, programming and math.
Quant devs are skilled in programming and some of them know a little bit of finance.
There is a lot of work for both of them !
arkadij 05 Jan 2010
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