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Financial engineering is the application of mathematical methods to the solution of problems in finance. The study of financial engineering includes elements from applied mathematics, computer science, statistics, and economic theory.

Financial engineering draws on tools from investment banks, commercial banks, hedge funds, insurance companies, corporate treasuries, and regulatory agencies that employ financial engineers. Using financial engineering methods, these businesses try to solve problems relating to new product development, derivative securities valuation, portfolio structuring, risk management, and scenario simulation.

As a financial engineer, you will be working on the trading desk and delivering models, risk calculators, etc directly to traders, or in risk management, model validation, and library control, CVA, or quantitative development and programming.

 

A career in Financial Engineering: What you’re going to need

A strong background in electrical and/or computer engineering (with a master’s degree, preferably), very strong programming skills (C++, Java, C#, Scala, Python, etc.) and comfort with very large data sets are key. If you are interested in the mathematics of it all, having a PhD is a bonus, although not a necessity.

Successful applicants to Master of Science in Financial Engineering programmes typically have undergraduate degrees in Operations Research, Applied Mathematics, Mathematics, Theoretical Physics, Electrical Engineering, Computer Science or Engineering, and Mechanical Engineering.

 

Careers following a degree in Financial Engineering

Following an Master of Science in Financial Engineering degree, candidates typically get hired in the following fields:

 Fields  Companies & Roles
Risk Management Companies: Axioma, CME Group, Morgan Stanley, Bank of America, KPMG, Oliver Wyman, Wells Fargo

Job Titles: Risk Analyst, Quantitative Management Associate, Senior Consultant, Client Support Associate, Quantitative Associate

Research Companies: PwC, ITG, Banco Santander

Job Titles: Senior Economist, Research Associate, Research Analyst, Financial Analytics & Derivatives Analyst

Portfolio Management, Strategy, Modeling and Valuation Companies: J.P. Morgan, Morgan Stanley, Goldman Sachs, PwC, CME Group, Barclays Capital, Citi, Squarepoint Capital, Credit Suisse, Volant Trading, Weiss Asset Management

Job Titles: Quantitative Analyst, Consultant, Quantitative Research Associate, Strategist, Valuation Associate, Senior Analyst, Quantitative Researcher, FX Electronic Trading Strategist

Trading and Investment Banking Companies: Credit Agricole Securities, ABG Sundial Collier, Volant Trading, J.P. Morgan, RBC, Nomura, Barclays Capital, UBS, HSBC, Morgan Stanley

Job Titles: Associate, Structuring Analyst, Trader, Quant Trader, Trading Analyst

Corporate Finance, Financial Technology and Data Analytics Companies (2015): World Bank, Goldman Sachs, Salesforce, Deloitte, Bank of America Merrill Lynch, TransMarket Group

Job Titles (2015): Financial Advisory Associate, Analyst, Technology Associate

 

Typical Salary Statistics

  • Average Base: $90,000
  • Base Salary Range: $60,000- $130,000
  • Average Sign-on: $15,000

 

Where should you get a Master of Science in Financial Engineering degree from?

  • Carnegie Mellon University
  • Baruch College, City University of New York
  • Columbia University
  • University of California, Berkeley
  • New York University
  • Princeton University
  • Columbia University
  • Cornell University
  • Massachusetts Institute of Technology
  • University of Chicago
  • University of Toronto
  • Boston University
  • University of California, Los Angeles
  • University of Washington
  • University of Waterloo
  • Georgia Institute of Technology
  • NYU Polytechnic School of Engineering
  • Rutgers University
  • University of Illinois
  • Fordham University
  • University of Minnesota
  • Johns Hopkins University
  • University of North Carolina at Charlotte
  • Claremont Graduate University
  • Rensselaer Polytechnic Institute
  • North Carolina State University
  • University of Southern California
  • Illinois Institute of Technology
  • Stevens Institute of Technology

 

Master of Science in Financial Engineering programme: How to apply 

Typically applications for all Master of Science in Financial Engineering programmes are online. The components of an application packet include:

  • Application Form: This form contains a summary of your academic, demographic, professional (if available and pertinent) and extracurricular information.
  • Resume: You will need a resume that includes your employment history and any internships in reverse chronological order, with titles, dates, and whether your employment was part time or full time. Your educational record should also be in reverse chronological order and should indicate dates of attendance and degree(s) earned or in progress. Other information appropriate to a business resume is welcomed and encouraged. The resume should be no more than one page in length.
  • Personal Statement: Typically, you will have submit a personal statement (500 words or fewer) with your application. In the statement, you will have to answer the following questions:
    • Why is the Master of Financial Engineering the right programme for you?
    • Why is School X the right place for you?
    • What are your overall objectives and aspirations?
    • How would this degree help fulfill these aspirations?
  • Recommendations
    Typically, a Master of Science in Financial Engineering programme requires you to submit three letters of recommendation. These letters should be from faculty who are able to speak definitively about your academic achievement and potential. If you have been working, you can submit an additional recommendation from a work supervisor or manager, who can speak with certainty about your professional achievement and potential.
  • Academic records (transcripts)
    You need to have transcripts from all post-secondary institutions that you have attended or are currently attending.
  • Test scores (GRE)
    Master of Science in Financial Engineering programmes typically accept only GRE test scores.
  • Language test Scores (IELTS/TOEFL/  PTE)
    International students have to submit language test scores along with their application. Most Master of Science in Financial Engineering Programs accept the TOEFL/IELTS/PTE

 

 

 

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