SERVING THE QUANTITATIVE FINANCE COMMUNITY

Paul
Posts: 10771
Joined: July 20th, 2001, 3:28 pm

### Will the profession of "Quant" die?

Also to go back to basics and ask what are banks forP

Siberian
Posts: 298
Joined: June 25th, 2003, 8:56 pm

### Will the profession of "Quant" die?

I am sorry twofish, are you saying there is less suply of MBAs than PhD in astrophysics? Am i reading you right?Ev

quantmeh
Posts: 5974
Joined: April 6th, 2007, 1:39 pm

### Will the profession of "Quant" die?

QuoteOriginally posted by: SiberianI am sorry twofish, are you saying there is less suply of MBAs than PhD in astrophysics? Am i reading you right?Evi noticed there's a lot of astro-physicists in usa. why? r the skies clearer here?

Cuchulainn
Posts: 62106
Joined: July 16th, 2004, 7:38 am
Location: Amsterdam
Contact:

### Will the profession of "Quant" die?

QuoteOriginally posted by: jawabeanQuoteOriginally posted by: SiberianI am sorry twofish, are you saying there is less suply of MBAs than PhD in astrophysics? Am i reading you right?Evi noticed there's a lot of astro-physicists in usa. why? r the skies clearer here?Someone said once "because the sky's the limit".

ScorpioS
Posts: 60
Joined: June 28th, 2003, 11:01 pm

### Will the profession of "Quant" die?

Regulated Market! I do not understand how this is going to work!Let' assume that 2 parties want to arrange a transaction (something exotic fitting some risk needs), how can regulation stop these two parties sign this contract Except if the governments are going to take control of everything even private companies ect, Then we need no markets and we are back to the past!

quantmeh
Posts: 5974
Joined: April 6th, 2007, 1:39 pm

### Will the profession of "Quant" die?

QuoteOriginally posted by: ScorpioSRegulated Market! I do not understand how this is going to work!u have a peculiar view of what "regulated" means in USA. if u r a bank holding, u r regulated by FRB, as a opposed to SEC for IBs. for example, FRB wants u to have certain amount of capital against your assets. it doesnt mean that FRB is going to approve every single deal of yours, but it will monitor your capital level among other things. it would be harder to be leveraged 20-1 accross the enterprise, because it's just 5% capital. FRB's standards r somewhat around 8%-10%. u can have more or less than that depending on the quality of your assets. there r many other things u'd have to do under FRB's authority, they're concerned about safety and soundness of the banking system, and it's A GOOD THING to me
Last edited by quantmeh on September 21st, 2008, 10:00 pm, edited 1 time in total.

twofish
Posts: 4944
Joined: February 18th, 2005, 6:51 pm

### Will the profession of "Quant" die?

QuoteOriginally posted by: ScorpioSLet' assume that 2 parties want to arrange a transaction (something exotic fitting some risk needs), how can regulation stop these two parties sign this contract/Basically two people can sign whatever they want, but in the end what matters is if a court will enforce a contract. There are two ways of getting around this. The first is to put conditions that a corporation has to legally follow in order to be able to write certain contracts, and if those conditions aren't met the contract is unenforceable. The second is to put conditions on who has the authority to enter into a contract. I can sign a contract pledging that $8 billion dollars of Exxon-Mobil cash, but if I have nothing to do with Exxon-Mobil, then you can't collect money from me. Even if I am the CEO of Exxon-Mobil and I sign a contract with my brother-in-law giving him$8 billion dollars for nothing, I can expect to find myself in court. QuoteThen we need no markets and we are back to the past!It's actually the opposite. You need a huge amount of government involvement to make markets work.

GraemeK
Posts: 11
Joined: March 8th, 2007, 12:45 pm

### Will the profession of "Quant" die?

QuoteYou need a huge amount of government involvement to make markets work.Depends to me on what one means by 'market', what makes it 'work' for participants and also what one regards as the motivator for 'government involvement' in that 'market'.eg is the mortgage (to name but one) 'market' just the institutions and their employees or does it include the people who buy most of the mortgages? Are mortgage buyers not exploiting leverage available to them from institutions and therefore are direct participants in that market?is the market 'working' when some participants know they can't lose, or get special treatment from the referee? Or is that just a question of efficiency and TTM of the correct signals. Who is best placed to decide the merit of the signals? and how wise is their judgement and how effective is their response? On average?Given that a government directly or indirectly influences their domestic interest rate then are the politicians not wanting to be both participants and referees? As suggested already, what are banks for? Do they grease the engine or do they think they ARE the engine? How far away from the largely assumed 'efficient market' are contemporary models?Maybe there's some better models out there, waiting to be discovered, that quantify risk better in terms of both what is 'free' and what is 'market'?
Last edited by GraemeK on September 22nd, 2008, 10:00 pm, edited 1 time in total.

tibbar
Posts: 554
Joined: November 7th, 2005, 9:21 pm

### Will the profession of "Quant" die?

Well if things get really bad, you can always retrain as an actuary

eredhuin
Posts: 263
Joined: July 14th, 2002, 3:00 am

### Will the profession of "Quant" die?

Tibbar, the actuaries I've met all want to be quants
Last edited by eredhuin on October 19th, 2008, 10:00 pm, edited 1 time in total.

quantmeh
Posts: 5974
Joined: April 6th, 2007, 1:39 pm

### Will the profession of "Quant" die?

QuoteOriginally posted by: eredhuinTibbar, the actuaries I've metwere they all from AIG?sorry, i couldnt resist

StatGuy
Posts: 607
Joined: November 20th, 2007, 9:03 am

### Will the profession of "Quant" die?

Perhaps the ones who wanted to become quants couldn't get through the exams Depends on what your outlook is. Not every actuary wants to be a quant.SG
Last edited by StatGuy on September 22nd, 2008, 10:00 pm, edited 1 time in total.

AbhiJ
Posts: 748
Joined: August 5th, 2008, 11:29 am

### Will the profession of "Quant" die?

There is a form of bias in which we only see the information we want to see and we just ignore the conflicting information.Maybe that's what SG is refering to. Moreover with a quant job you have to like programming otherwise you would be frustrated for the majority of your time.Some people just don't like it, give them whatever.
Last edited by AbhiJ on September 22nd, 2008, 10:00 pm, edited 1 time in total.

StatGuy
Posts: 607
Joined: November 20th, 2007, 9:03 am

### Will the profession of "Quant" die?

There is always bias, we just have to do the best we can otherwise no decision will be made. Just because all your mates who were actuaries want to be a quant dosn't imply all actuaries do (and before anyone mentions there was a survey done on this etc,, that will be biased too). You have to bear in mind the views on this forum will be biased towards quants. If you went to an actuarial forum (if one exists) I am sure actuaries will be negative towards quants etc. So one has to be careful when making statements about the population based on their limited biased sample. We all do this to some extent and don't realize it. There are pros and cons in any job, you just have to make a informed decision about the career that suits you based on your personality type, risk profile, and future aspirations. Of course there will be some who just dont have a clue what they want, so in this case you just have to try out a few roles that you *may* like and learn from the experience. Also just because x said this role was crap dosn't mean it will be crap for you. SG
Last edited by StatGuy on September 22nd, 2008, 10:00 pm, edited 1 time in total.

graam
Posts: 29
Joined: May 15th, 2008, 12:40 am

### Will the profession of "Quant" die?

Have we thought about these points before supporting the death of quant roles?1. Why did the crisis arise & what could have we done to not be at this point? Am talking micro - upto valuation level.2. Now that the crisis is here, how can we create solutions that factor these from next time?3. We have just been busy following the normal dist models and borrowing the "thinking" that was done back in 70's.... If we don't live in the 70's world anymore, we need models and solutions for the new era. Now, I haven't done any research around which banks/funds hire or which don't for quant roles or any #/% stats - so you might be right on the stats .... However, if you factor the above questions, we will soon realize the this point is probably going to lead to a new evolution - may be new products , new rules,new way of thinking and managing.Do I care if CDO is there or not? or if CDO gets renamed to PDO? NO. As long as we are in the industry for "ourselfs" and the fun of solving problems, then there is more oppurtunity since the poorly skilled will all be washed out...