SERVING THE QUANTITATIVE FINANCE COMMUNITY

 
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FKant
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Posts: 4
Joined: December 6th, 2008, 3:06 pm

Quant finance outside major centers

October 28th, 2010, 5:40 pm

Dear all, I have recently graduated from Polytechnic Federal School of Lausanne (EPFL) in Applied Mathematics (Msc). I have started an internship on the Fixed Income desk at the first Moroccan bank, working on yield curve modelling and prediction (C++) but also some macroeconomic research, mainly to see how work is like in my home country. Needless to say, quantitative finance is embryonic here, with some OTC derivatives activity and some structuring going on (low demand though). I aim to work in exotic derivatives structuring, so relocation to London/NY/... is necessary. My questions are the following: 1) if I worked 1 or 2 years in Morocco in a relevant position, would it be possible to bounce back on an entry level job in one of the major financial hubs, or would the experience be poorly looked at ?Pros: wait for recruitment to start again (I have no evidence documenting this statement), perfect my skills in quant finance (did not learn much in financial engineering during my masters, compared to the mathematical and programming toolkit).Cons: hard to value the experience since products range from vanilla to mildly exotic.2) Would it be an overkill to do an MFE with my current diploma ? (It is also important to mention that obtaining visa / work permit in the current economy for London or NY is pretty hard for foreigners, so an MFE could ease this aspect) Thanks in advance !!
 
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Gmike2000
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Joined: September 25th, 2003, 9:49 pm

Quant finance outside major centers

October 28th, 2010, 8:20 pm

Working outside the major centers has the disadvantage of lower POTENTIAL career and salary prospects. But for an average person, the EFFECTIVE career prospects may actually be better. Think about it, in London/NY you have about a zillion young kids competing for the same jobs. You may end up stamping trade tickets in some back office in NY while you could do front office work elsewhere. After 2 yrs backoffice in NY they will not let you switch to front-office in Morocco. You will be branded "backoffice" for the rest of your career. On the other hand if, e.g., you do something very stupid in the front-office, like trading cash equities, you may actually have a shot at similar jobs elsewhere. People will respect the fact that you swam in the market and did not sink (presumably).Also there is the quality of life aspect. Needless to say you will enjoy life better in Morocco. Having said that, if Morocco is too hinterlandish for you, there are plenty of sattellite locations all over Europe. And you don't need to just consider banks...asset managers are attractive employers too.
 
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FKant
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Posts: 4
Joined: December 6th, 2008, 3:06 pm

Quant finance outside major centers

October 30th, 2010, 12:52 pm

Thanks Gmike for your answer, actually I don't intend to settle down yet and would rather enjoy an international career for a decade or so in a challenging environment (lived a diplomat's life, being abroad most of the time). Morocco is great when you are in your mid-thirties / fourties and you want to spend quality time with your wife and raising your children (I see them on the trading floor, starting work at 8.30 and leaving at 4.30) whilst enjoying the sunny climate, but not for a young lad who needs something more fast-paced and interesting. Competition is part of the game, and if getting a structuring job in a BB is too hard, I wouldn't mind working for a smaller bank / asset management firm. Getting the job you want is better than the bank you're targetting, and you can always climb the ladder afterwards if you prove yourself, which may be harder if you do MO/BO work right ?You were mentionning satellite locations in Europe, which ones are we talking about ? In structuring, most jobs are in London and NY, Paris has some jobs available (although substantially less than the former ones) but priority is given to the "Grandes Ecoles" (X, Centrale,...). Frankfurt would be good as well, but you need to be fluent in German, and I can "only" claim an upper-intermediate level. What about Dubai ? What are others people's thoughts on 1) and 2) ?
 
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twofish
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Joined: February 18th, 2005, 6:51 pm

Quant finance outside major centers

October 30th, 2010, 1:01 pm

QuoteOriginally posted by: FKantI aim to work in exotic derivatives structuring, so relocation to London/NY/... is necessary. My questions are the following: 1) if I worked 1 or 2 years in Morocco in a relevant position, would it be possible to bounce back on an entry level job in one of the major financial hubs, or would the experience be poorly looked at ?The problem is having contacts in London/NY. Experience in Morocco could be highly looked if your experience happens to be something that the bank wants. Quoteperfect my skills in quant finance (did not learn much in financial engineering during my masters, compared to the mathematical and programming toolkit).Something that might work is to become the world expert in Moroccoan quantitative finance. I have no idea how feasible that is, but your the expert on that :-) :-)Seriously, how big is Islamic finance in Morrocco and are there deep linkages with the Middle East and the oil states?Also, if you want international exposure, I'd suggest going to Singapore, Hong Kong, or Dubai for now. The mood in the US is rather ugly right now.
Last edited by twofish on October 29th, 2010, 10:00 pm, edited 1 time in total.
 
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KackToodles
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Joined: August 28th, 2005, 10:46 pm

Quant finance outside major centers

October 30th, 2010, 9:42 pm

if you know about the Vegas or Nevada hedge fund scene, pls pm me.
 
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meniscus
Posts: 48
Joined: August 10th, 2010, 4:34 pm

Quant finance outside major centers

October 31st, 2010, 2:14 pm

I know it's perhaps not an obvious choice, but have you considered India? It's got a booming IR swaps market and it's only natural with time that their derivatives market will expand more to cover more sophisticated instruments.
 
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FKant
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Posts: 4
Joined: December 6th, 2008, 3:06 pm

Quant finance outside major centers

October 31st, 2010, 10:06 pm

@ Twofish: yeah maybe I can become the expert in moroccan yield curve forecasting, since according to my MD, it has been done before but it failed: with an inefficient, illiquid market, pure mathematical models are bound to fail, so I am trying to incorporate relevant macroeconomic variables on top of a statistical model to attempt a fairly good short-term prediction (3-6 months). Wether it will succeed or not, I don't know, but the effort shall be worth it. Islamic finance is not very developped, although it has started recently in my bank with some Halal products. Morocco is one of the most westernized muslim countries, so islamic finance is not on the agenda right now, and we don't have much links with the oil states apart from real estate projects. However, the bank I am interning in is currently aggressively expanding in Africa, my MD is developing capital markets activities in several french-speaking African countries. That could be of some interest, don't you think ? @meniscus: India, China, Brazil can be major financial centers in 20 years, but from what I've seen (didn't research for all banks), international banks have their emerging markets activity in headquarters (London/NY). I have tried to see opportunities in Brazilian banks, but without Portuguese, you're lost. Also, I would like to choose a place where my learning curve is the steepest, after which all locations with tremendous potential could be considered. Another issue with going to second-tier centers, as mentionned in Mr Dominic Connor's blog, is the issue for newbies to get a good brand and to learn the business, and that's why I would definitely be interested to what extent it restricts your chances of moving to NY/London. I will definitely consider getting international exposure elsewhere if it doesn't hinder your career prospects. Thanks for your answers !
 
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twofish
Posts: 4944
Joined: February 18th, 2005, 6:51 pm

Quant finance outside major centers

November 1st, 2010, 1:32 am

QuoteOriginally posted by: FKantIndia, China, Brazil can be major financial centers in 20 years, but from what I've seen (didn't research for all banks), international banks have their emerging markets activity in headquarters (London/NY).The Asia operations for the big banks are run out of either Hong Kong or Singapore. You can't do Asian finance out of London or NY because of time zone. Right now Asia is hiring because India and China are out of the recession whereas US and Europe are still mired in the recession.At least for China, Shanghai is going to be a major financial center for domestic activities, but I don't see it being a hub for global finance. That role is going to be taken by Hong Kong for the forseeable future. It could be that Shanghai will be bigger than Hong Kong in 20 years, but the international stuff will still go through HK. You can think of Hong Kong as something of an "airlock" into China. Hong Kong is also "neutral territory" QuoteWhy I would definitely be interested to what extent it restricts your chances of moving to NY/London.Hong Kong and Singapore are not second tier cities, and I do know of people that have moved from Asia to London.
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