What is the reality of transitioning from a physics PhD to a quant position?

[thrill3rnit3]

Throughout my time here in PhysicsForums, however short that may be, I've been always hearing about being a "quant".

What exactly do "quants" do? What kind of education is necessary? To all the quants here, do you like your job?

 

[HallsofIvy]

"quant"? Do you, possibly, mean a quantitative chemist?

 

[Klockan3]

What you usually mean with "quant" is "quantitative analyst" in the finance sector. The reason it is talked about is since many with physics/maths backgrounds goes into that field. The reason they recruit physicists for example is because they are extremely good at quantitative computations and their background do not lend itself to that many other jobs.

Quants often come from physics, engineering, or mathematics backgrounds rather than economics-related fields, and quant finance is a major source of employment for people with physics and mathematics Ph.Ds.

http://en.wikipedia.org/wiki/Quantitative_analyst

 

[Jack21222]

Search for some posts by twofish_quant and see what he has to say. Though, I'm sure he'll be popping in this thread any moment anyway.

 

[Akirus]

So if you were to get a Ph.D in physics/math, you could also apply to be a quant in addition to academics?

What's the difference between a quant and an actuary?

 

[Saladsamurai]

<snip> What exactly do "quants" do? you like your job?

Do you mean aside from f***ing up the economy?

 

[Leptos]

It seems like quite a few people that go the physics Ph.D -> academia -> quant route do so because they aren't satisfied with their post-doctoral positions and/or they feel like they've hit a bottleneck in terms of research potential. It may be more realistic to settle for a job on Wall Street rather than striving for the Nobel prize in physics or the fields medal.

You replace curiosity/discovery-driven work with computation/risk-driven work and you replace a moderately sized wallet with a large overstretched wallet.

 

[Locrian]

What's the difference between a quant and an actuary?

Quants and actuaries work in different types of companies, typically have different education and backgrounds, have different professional requirements and their daily job is usually (but not always) different. I’ve certainly heard stories of overlap between the two careers, but I think this is exceedingly rare. I’ll try to highlight the things I feel confident are different, but hopefully others will add and edit this as necessary.

What makes a quant a quant is that they are employed in a quantitative analyst position and/or they do the work of a quantitative analyst. What makes an actuary an actuary is that they are a member of a professional organization that credentials them as such (SOA, CAS, MAAA). One can be an actuary and not do anything remotely actuarial, and one can do actuarial work and not be an actuary. To put it another way, if a quant becomes a CEO, they aren’t a quant anymore, while our CEO is still an actuary as long as he maintains continuing education requirements and pays his dues.

Both quants and actuaries can come from a variety of backgrounds. Most quants have graduate level experience in mathematics and/or programming (I’ve never heard of one that didn’t). Actuaries must pass a series of examinations that largely serve as their educational requirement, and they may or may not have any graduate level education. In fact, so long as you are capable of passing the exams, your undergraduate degree is relatively unimportant. Once you get a job as a quant and gain some experience you can typically call yourself a quant. If I worked the rest of my life at my current job and never finished the actuarial exam process, I would never be an actuary (I’d by an “actuarial analyst” or “actuarial technician”).

Actuaries work almost entirely in insurance, and their primary function is to price the risks the insurance companies face and maintain the financial stability of the insurance company. Quants do things such as pricing assets, or statistical modeling of asset prices – I’ll let others describe a quant’s work in more detail. I think one way to look at the difference between them is that actuaries study liabilities and quants study assets, though that’s an oversimplification.

I think (though admittedly I’m less sure of this) that actuaries are more constrained in their work methodologies than quants. I believe actuarial work is often, but not always less creative. I’m talking about means in big distributions though; an actuary involved in climate modeling has a very different job than a life actuary who reserves all day.

For me the biggest difference between quants and actuaries is their social contract. Actuaries aren’t just regulated – they’re part of the regulatory process. An actuary has a responsibility to maintain the financial integrity of their company, and this responsibility is not just to their company, but to the state, their professional organization and the public. A chief actuary has tremendous power over the company he or she works for because it will shut down without their signature. He or she often has to make very difficult decisions that balance the needs of the company at that time while still being transparent with the regulators and the public.

I’m sure there’s lots people may disagree with here, but I think it sets the stage.

 

[Locrian]

You replace curiosity/discovery-driven work with computation/risk-driven work

That's not an accurate statement.

 

[Jokerhelper]

https://www.physicsforums.com/showthread.php?t=376191 found this thread in the "similar threads" section here beneath. Seems to have lot's of info.

 

[j93]

Do you mean aside from f***ing up the economy?

I decided that I don't blame them anymore since they were being rewarded for increasing profits and saw a broken rating system that they could exploit. I sure as hell blame the government and the boards of those corporation for having a system where you can sell toxic assets packaged as a great investment and CEO's who were so nearsighted as to not see that these subprime loans eventually would blow up on one of their faces.

 

[twofish-quant]

Throughout my time here in PhysicsForums, however short that may be, I've been always hearing about being a "quant".

Basically a mathematical modeler or glorified computer programmer.

What exactly do "quants" do?

Write/debug/test financial models.

What kind of education is necessary?

I have a Ph.D. in astrophysics. You'll need at least a masters degree.

To all the quants here, do you like your job?

Sure.

 

[twofish-quant]

It seems like quite a few people that go the physics Ph.D -> academia -> quant route do so because they aren't satisfied with their post-doctoral positions and/or they feel like they've hit a bottleneck in terms of research potential. It may be more realistic to settle for a job on Wall Street rather than striving for the Nobel prize in physics or the fields medal.

My route was

physics Ph.D. -> software development -> quant

I'm open to any offers for faculty positions teaching astrophysics... If anyone knows any research universities that are willing to hire me to do astrophysics research, feel free to PM me... Waiting... Waiting... Waiting...

OK. No job offers this evening. Darn... I guess I'll end up doing plan B.

You replace curiosity/discovery-driven work with computation/risk-driven work and you replace a moderately sized wallet with a large overstretched wallet.

Having seen people in junior faculty hell, I'm not sure that what I do is less curiosity/discovery-driven than academia.