Quantitative Analyst Careers

Updated on April 5, 2024
Article byWallstreetmojo Team
Edited byAshish Kumar Srivastav
Reviewed byDheeraj Vaidya, CFA, FRM

What Are Quantitative Analyst Careers?

The quantitative analyst careers refer to jobs and professional opportunities that involve skills and qualifications to undertake quantitative analysis. Quantitative Analysis is all about the techniques and procedures used by the researchers to convert the numerical data into a statistical format to draw inferences and make a strategic decision.

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A quantitative analyst is a professional who uses various quantitative methodologies to identify profitable business opportunities for the company and helps in business strategies and financial decision-making. Quantitative Analysis refers to the techniques and procedures used by the researchers to convert the numerical data into a statistical format to draw inferences and make a strategic decision. A quantitative Analyst is a professional who uses various quantitative methodologies to identify profitable business opportunities for the company and helps in business strategies and financial decision-making. Quantitative Analysts are appointed by many Asset Management Companies, Hedge funds, Private Equity Firms, and Investment Banks to support them in the deal process by providing quantitative analysis for the project, helping them identify the potential in the investment, and manage the risk appetite of the client.

Quantitative Analyst Careers Explained

The quantity analysis careers and jobs are open for those who know how to conduct quantitative analysis to analyze the behavioral patterns in the market and accordingly help financial firms make appropriate decisions. Quantitative Analysis is one of the most crucial roles in any company, especially asset management companies, private equity funds, hedge funds, stockbrokers, and investment banks. It provides the behavioral pattern of the model prepared and gives the management a glimpse of the background of the entire population and how it is moving. It requires extensive data crunching and knowledge of statistics to do the coding and prepare the model that can be used to test the sample under the given population.

The demand for quantitative analysts is increasing daily with the number of statistical software available in the industry, which helps perform high-level data analysis using the latest techniques. Many IT companies are now focusing on quantitative data analysis software since it is in huge demand from stockbrokers and hedge fund managers to analyze their existing portfolios better.

The simple process for performing the quantitative analysis is first to identify the topic, make the required research or hypothesis & analyze the base data gathered from various sources, and then finally draw the conclusions and questions to be cleared.

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Below are the two quantitative analysis techniques that the quant analyst often uses in his work.

  • Descriptive Statistics: It is a procedure that simplifies and summarizes the numerical data into a graphical format for easy understanding. It measures the relationship between the variables and their correlation on a graph. It uses techniques like calculating mean, median, mode, range, average, coefficient correlation formula, standard deviation, etc., to draw conclusions and explain the numerical data to the reader in a simpler form. Normally, a histogram, bar chart, or pie chart is used to convey the results to the user. Researchers generally used the below-mentioned strategies :
    • The Central Tendency measure indicates the typical pattern and result of the population under study with a single score.
    • A measure of Dispersion: It indicates the difference between the group of scores and the spread between the two scores.
    • A measure of Relationship: It indicates the degree of relationship between the two variables.
  • Infernal statistics: It gives the probability that the given Statistical results are based upon the sample in the entire population.

List of Top 4 Careers

Let us now look at the top 4 career options as a Quantitative Analyst.

#1 – Statistical Analyst

Who is a Statistical Analyst?

Statistical Analyst analyzes large databases and applies mathematical and statistical techniques to provide the desired result for the organization.

Statistical Analyst – Job Description
ResponsibilitiesResponsible for building detailed statistical models and ensuring that the results are communicated to the senior management to make an informed decision.
DesignationStatistical Analyst
Actual RoleWork on quantitative methodologies to convert numerical data into statistical graphs.
Job StatisticsAs per the Bureau of Labor Statistics, the number of jobs in this category as of 2016 was 40,300 and is expected to grow by 33% from 2016-2026. The Link is – https://www.bls.gov
Top CompaniesBulge Bracket Investment Banks. Hedge Funds, NBFC, Stock Brokers, and Mutual Funds
SalaryThe median annual salary for a statistical analyst was $88,190, as per www.bls.gov/ooh.
Demand & SupplyHighly demanded profile since it requires extensive mathematical and statistical skills and experience working on large databases.
Education RequirementMaster’s degree in Mathematics or Statistics/MBA/CFA
Recommended CoursesMasters in Statistics/CFA
PositivesChance to take part in the company’s decision-making with the top management by providing them with relevant Statistical analysis.
NegativesExtensive data crunching and working on excel sheets can be boring.

#2 – Front Office Quantitative Analyst

Who is a Front Office Quantitative Analyst?

Front Office Quantitative Analyst works with companies that deal with financial products.

Front Office Quantitative Analyst – Job Description
ResponsibilitiesResponsible for preparing complex financial structures to analyze the company which will be acquired.
DesignationFront Office Quant Analyst
Actual RoleIt is to identify profitable trades for the company and develop various complex strategies for pricing the securities.
Job StatisticsNo data has been shared with the US Bureau of Labor Statistics.
Top CompaniesBulge Bracket Investment Banks. Hedge Funds, NBFC, Stock Brokers, and Mutual Funds.
SalaryThe median annual salary for a private front office quant analyst can be anywhere between $1,00,000 to $1,50,000 since it is a professional role.
Demand & SupplyHigh demand for the role requires extensive knowledge of the financial services industry and securities pricing.
Education RequirementCFA/Masters in Quant Studies or Statistics / MBA from Tier -1 Universities with at least 7-10 Yrs of Exp.
Recommended CoursesMasters in Statistics/CFA/CPA
PositivesExtensive financial services sector knowledge and an opportunity to draft trade strategies.
NegativesLong working hours and high data crunching and risky profile since a wrong trade strategy can significantly impact the company.

#3 – Risk Management Officer

Who is a Risk Management Officer?

The Risk Management Officer manages the entire risk of the organization by analyzing the portfolio periodically and suggesting the risk areas in the same.

Risk Management Officer – Job Description
ResponsibilitiesTo identify risk areas in the investments made by applying various quantitative techniques to develop and understand the existing and projected pattern of the securities and the market.
DesignationRisk Management Officer
Actual RoleTo build detailed risk management models for the securities invested and study the same behavior periodically.
Job StatisticsThe US Bureau of Labor Statistics does not display data on this role.
Top CompaniesBulge Bracket Investment Banks. Hedge Funds, NBFC, Stock Brokers, and Mutual Funds.
SalaryA risk management professional’s median annual salary can be between  $ 2,00,000 – $3,00,000.
Demand & SupplyHighly demanded profile since the companies require many risk management strategies.
Education RequirementCFA/Masters in Quant Studies or Statistics / MBA from Tier -1 Universities with at least 10+ Yrs of Exp in Risk Management.
Recommended CoursesMasters in Statistics/CFA/CPA
PositivesAn opportunity to work very closely with the Top management to make them aware of the risk areas in the business.
NegativesHigh-risk profile since it is not a revenue generation role.

#4 – Model Validation Analyst

Who is the Model Validation Analyst?

Model Validation Analyst tests the existing models prepared by the analyst in the company and reports any deviations from the same daily to the head of the department.

Model Validation Analyst – Job Description
ResponsibilitiesFor testing the model and coming up with suggestions to improve the same.
DesignationModel Validation Analyst
Actual RoleIs to do manual testing of the model prepared and see whether the same is not in contradiction with the basic principles of the model.
Job StatisticsThe Bureau of Labor Statistics has displayed no data.
Top CompaniesAll Bulge Bracket Investment Banks. Hedge Funds, NBFC, Stock Brokers, and Mutual Funds.
SalaryThe median annual salary for the same can be anywhere between $ 75,000 to $1,00,000.
Demand & SupplyThe salaries in this role are lower than the analyst role here, and the person only does the validation of the models prepared and is not involved in the actual coding.
Education RequirementCFP/CPA/MBA from Tier -1 Universities with at least 5-10 Yrs of Exp.
Recommended CoursesCPA/MBA/CFA
PositivesIt gets to know the model’s behavior daily and has a very informative role.
NegativesLess application of mind since the model is already ready and the person needs to feed different data types to justify the same.

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This has been a guide to what are Quantitative Analyst Careers. We explain the concept of quantity analysis with list of top 4 Quantitative Analyst careers. You may also have a look at the below articles –

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