Why are there so many physics grads in finance?

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  • Thread starter swampwiz
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  • #1
swampwiz
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I was reading about the FTX CEO, and it turns out that he has a degree in physics from MIT - and evidently there are a lot of folks that have taken this same education-career path. Is physics a degree a good path from quarks to quants?
 

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  • #2
Orodruin
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Physics graduates typically have strong mathematical and modelling skills. Things that can come in very handy in finance.
 
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  • #3
f95toli
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It is still a very common career path and if you go back to the 80s pretty much all quants had an physics background (usually a PhD)

However, these days there are also specialised financial engineering programmes (and other programmes with similar names) so that might be a better option if you are sure you want a career in finance.

There also "hybrid" options such math and physics programmes which allow for a specialisation in finance during the final year; as well as MSc programmes which accepts students with a bachelor in math or physics.
 
  • #4
Vanadium 50
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are a lot of folk
How many is "a lot"? Among PhD's, it's about 40 per year.
 
  • #6
swampwiz
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Relevant:
https://www.hbs.edu/ris/Publication%20Files/16-067_3d306ef8-09a1-42b3-956f-a797846b9e3c.pdf
In particular, see Figure 2 (p. 45), which suggests that the physics graduates most likely to go into finance are the least promising physicists. (But also note that the cohorts do not stretch over the same time period, suggesting maybe some data massaging to support a certain conclusion).
Perhaps the career model could be to go on Wall Street to build up a nest egg, and then go back to Physics?
 
  • #7
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One thing missing from here is that working in finance can be pretty fun. You have interesting problems that you are one of the first people ever to solve, and you get paid well for solving it. The space is enormous so it's not hard to find your niche.
 

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