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PDiCarterY
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Posts: 102
Joined: March 15th, 2005, 7:46 pm

Applied Math or Statistics?

November 12th, 2007, 4:34 am

I am just wondering about the following:1) Which one is better recruited at IBs?2) Which program is more relevant for trading?3) Which one is better for working as a quant?Thanks in advance.
 
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ChicagoGuy
Posts: 455
Joined: April 13th, 2007, 1:45 am

Applied Math or Statistics?

November 24th, 2007, 3:26 am

Im just a grad student in applied math but keep in mind many people look at statistics as an area of applied math. If you go into applied math you can always specialize in statistics, but you cant specialize in applied math as a whole if you go into statistics (you can just specialize in an area of statistics). Same with physics.
 
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meteor
Posts: 321
Joined: September 22nd, 2004, 5:20 pm

Applied Math or Statistics?

November 24th, 2007, 5:06 am

To answer your questionThe way I see it:Stat: some knowledge of stoch calculus but in depth knowledge of parameter estimation, stat modelling (ie explaining/modelling data).Applied math: (stoch calculus / probability specialization): strong knowledge of stoch calculus but weak knowledge of stat techniques and modelling.1) It doesnt really matter if you are good and as long as you combine your degree with some knowledge in finance.2) It depends what type of trading you are doing. If you are working with derivative product I would be inclined to say applied math. If you are doing stat arb of course stat is better.3) It depends what you define as quant. If by quant you mean pricing model developmen I would say applied math. If you mean by quant developping quant strategies then stat is better.Overall just choose what topic you like the best to study (as I dont think it is a good idea to pursue some degree just because of the career opening it will give you)
Last edited by meteor on November 23rd, 2007, 11:00 pm, edited 1 time in total.
 
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DominicConnor
Posts: 11684
Joined: July 14th, 2002, 3:00 am

Applied Math or Statistics?

November 24th, 2007, 9:48 am

1) I am sort of with Meteor, and would add that it is not a case of it not being important, but that the factors often mostly cancel out. A zero net resultant does not mean you don't have forces acting.2) I have noticed a slight correlation between stats and trading, but nothing major and I may be wrong.3) Applied maths is typically better for quant work.But, there is another point; what are you best at ?The career prospects when you are doing the type of maths you excel at are much better than being mediocre at something more popular.Also of course, I would never advise anyone to stick to a pure applied maths curriculum or pure stats.When you go for the best jobs, they will fire both types of question at you, and this reflects that what you are being paid to do is solve problems and think up new ideas.You are not being paid to be a statistician or an applied mathematician, and I would emphasise you are not employe to be anything at all, you are emplyed to do, and the doing is the making of money.That means if the problem involves stats you do stats, if it's PDEs, you do MC or FDM, it it's programming you do C++ or VBA.A lot of what people call "creativity" is actually the someone smart enough to steal ideas from different domains and glue them together. Look at how the Black Scholes equation was solved and derived, bits of economics nailed together with the maths of heat physics. You can get a Nobel prize for shit like that....or at least a decent bonus.
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