If you'd like to become a quantitative analyst, then you'll need to gain extensive education, beginning with a master's degree, typically the minimum degree required for lower level positions. More advanced positions often require continuing education, earning a Ph.D.
Quantitative analysts gather and analyze data often used in financial decision-making. Many are employed in the financial investment industry, but they may also work in industries ranging from accounting to engineering. A master's degree in a quantitative field is often required, but some employers may require a doctoral degree. These professionals must be proficient in many skills, such as data analysis and programming languages.
|Required Education||A master's degree is typically required; high-level positions may necessitate a Ph.D.|
|Recommended Credentials||Chartered Financial Analyst (CFA) designation|
|Projected Job Growth (2018-2028)||6% (for financial analysts)*|
|Median Salary (2019)||$83,425** (for quantitative analysts)|
Source: *U.S. Bureau of Labor Statistics, **PayScale.com
Educational Requirements for Quantitative Analysts
Becoming a quantitative analyst typically requires a master's degree in quantitative finance, financial engineering or a related quantitative field, such as physics, statistics or math. Some employers may require a Ph.D. for senior-level positions. Students often minor in economics, and some schools offer dual programs in quantitative finance and applied mathematics.
Quantitative finance coursework often includes statistics, linear algebra, accounting, financial reporting and several semesters of calculus and economics. Students also take courses in computer programming, learn about financial markets and investments and become familiar with methods used in financial and numerical analysis. Many programs include an internship.
Quantitative analysts, also known as 'quants,' often work in the finance industry, analyzing statistics and developing mathematical models used to make decisions regarding risk management, investments and pricing. They may be employed by hedge funds, investment banks, securities and commodities traders, brokerage firms, accounting companies and financial consulting firms. Other employers include engineering firms and government agencies. The information they gather is generally used in algorithmic trading, statistical arbitrage, derivative pricing and quantitative investing.
Quantitative analysts must have excellent written and verbal communication skills and outstanding abilities in mathematics, statistics, data mining and data-intensive analysis. They must also have strong computer programming skills, including object-oriented programming and familiarity with programming languages such as C++. A strong understanding of systematic and discretionary trading practices, interest rate derivatives and financial modeling is also essential for quantitative analysts.
Many investment professionals and quantitative analysts pursue the Chartered Financial Analyst (CFA) designation, offered by the CFA Institute (www.cfainstitute.org). Candidates participate in an independent-study program and must pass three exams. Though voluntary, CFA designation is desired by many employers. Some quantitative analysts also pursue a Certificate in Quantitative Finance (CQF); training lasts six months and consists of courses, workshops, weekly exercises and a final exam (www.cqf.com).
Salary and Outlook Information
The U.S. Bureau of Labor Statistics (BLS) predicted job growth of 6% for financial analysts during the 2018-2028 decade (www.bls.gov). As of 2019, PayScale.com reports a median salary for quantitative analysts of $83,425. In the related field of statistics, the BLS predicted job growth of 31% for statisticians during the same 10-year period. In 2018, the BLS reported that statisticians earned a median annual salary of $87,780.
Becoming a quantitative analyst means you'll be able to interpret data in order to make the most efficient financial decision for businesses. While a master's degree is required for employment, many opt for more advanced degrees such as a Ph.D. and optional certifications in order to distinguish themselves.