With the rapid development of financial markets, quant investment banking has become a popular yet challenging career choice for graduates with STEM backgrounds. As an integration of finance, mathematics and computer science, quant refers to professionals who use mathematical models and programming skills to solve practical problems in investment banks. However, the recruitment requirements of top investment banks are quite stringent, with a master’s degree being the minimum entry level. This article will analyze the job responsibilities, required skills and future prospects of quant investment bankers.
Quant investment bankers focus more on derivatives pricing and trade support
Based on job positions, quant investment bankers generally belong to front office and are responsible for derivatives (e.g. futures, options) pricing models and providing trade support tools for traders. Their main work includes building pricing libraries in C++, designing new pricing models for exotic derivatives, and implementing optimal trade execution algorithms.
Strong quant skills in math, stats and programming are a must-have
To qualify as a successful quant in investment banks, one must be proficient in quantitative skills like advanced math (stochastic calculus, PDE), statistics (time series analysis, machine learning) and programming (C++, Python). Practical knowledge in finance is also important when applying models.
Work experience and target schools matter in quant recruiting
Top investment banks emphasize relevant internship experience a lot when hiring junior quants. And target schools like MIT, Princeton, Oxbridge also enjoy priority in resume screening. So solid quant skills, work experience and a decent school brand will help one stand out.
Future path leads to quant researchers, traders or buy-side
With years of experience, quants can get promoted to senior quant researchers or traders within their banks. Other career options include moving to hedge funds as researchers or portfolio managers, or becoming strats at top-tier investment management firms.
To summarize, quant investment banking has promising prospects but also high barriers. Aspiring quants need to prepare themselves academically and career-wise as early as possible.