Quantitative Analyst Careers

List of Top 4 Quantitative Analyst Careers

Below is the list of Quantitative Analyst Career Options that you can look for in your Finance Career –

Quantitative-Analyst-Careers

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Overview of Quantitative Analyst Careers

A quantitative Analyst is a professional who uses various types of quantitative methodologies to identify profitable business opportunities for the company and also 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 in order to draw inferences and make a strategic decision. Quantitative Analysts are appointed by many Asset Management CompaniesAsset Management CompaniesAsset Management Company is a company that takes the financial assets of a person, company or another asset management company (generally this will be high net worth individuals) and use the assets to invest in companies that use those as a operational investment, financial investment or any other investment in order to grow the investment.read more, Hedge fundsHedge FundsA hedge fund is an aggressively invested portfolio made through pooling of various investors and institutional investor’s fund. It supports various assets providing high returns in exchange for higher risk through multiple risk management and hedging techniques.read more, Private Equity FirmsPrivate Equity FirmsPrivate equity firms are investment managers who invest in many corporations' private equities using various strategies such as leveraged buyouts, growth capital, and venture capital. The top private equity firms include Apollo Global Management LLC, Blackstone Group LP, Carlyle Group, and KKR & Company LP.read more, and Investment BanksInvestment BanksInvestment banking is a specialized banking stream that facilitates the business entities, government and other organizations in generating capital through debts and equity, reorganization, mergers and acquisition, etc.read more to support them in the deal process by providing quantitative analysis for the project, help them identify the potential in the investment, and manage the risk appetiteManage The Risk AppetiteRisk appetite refers to the amount, rate, or percentage of risk that an individual or organization (as determined by the Board of Directors or management) is willing to accept in exchange for its plan, objectives, and innovation.read more of the client.

The simple process for performing the quantitative analysis is to first 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.

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

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 in order to provide the desired result for the organization.

Statistical Analyst – Job Description
ResponsibilitiesResponsible for building detailed statistical models and ensure that the results are communicated to the senior management in order to make an informed decision.
DesignationStatistical Analyst
Actual RoleWork on quantitative methodologies to convert the 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 expected to grow at 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 along with experience working on large databases.
Education RequirementMasters degree in Mathematics or Statistics / MBA/ CFA
Recommended CoursesMasters in Statistics / CFA
PositivesChance to take part in the decision-making of the company along 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 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 is going to be acquired..
DesignationFront Office Quant Analyst
Actual RoleIs to identify profitable trades for the company and develop various complex strategies with regards to the pricing of the securities.
Job StatisticsNo data has been shared on the Bureau of Labour Statistics of the US.
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 & SupplyVery high demand for the role since it requires extensive knowledge of the financial services industry and the pricing of the securities.
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 knowledge of the financial services sector and an opportunity to draft trade strategies.
NegativesLong working hours and high data crunching and risky profile since a wrong trade strategy can have a significant impact on the company.

#3 – Risk Management Officer

Who is Risk Management Officer?

Risk Management Officer manages the entire risk of the organization by analyzing the portfolio on a periodic basis 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 in order to develop and understand the existing and the 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 behavior of the same on a periodic basis.
Job StatisticsThe Bureau of Labour Statistics of the US does not display data on this Role.
Top CompaniesBulge Bracket Investment Banks. Hedge Funds, NBFC, Stock Brokers, and Mutual Funds
SalaryThe median annual salary for a risk management professional can be anywhere between  $ 2,00,000 – $3,00,000.
Demand & SupplyHighly demanded profile since the companies require a high amount of risk management strategies to be applied.
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 in order 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 on a daily basis to the head of the department.

Model Validation Analyst – Job Description
ResponsibilitiesFor testing the model and coming with suggestions in order 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 StatisticsNo data has been displayed by the Bureau of Labor Statistics.
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 as compared to the analyst role since here 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
PositivesGets to know the behavior of the model on a daily basis and a very informative role.
NegativesLess application of mind since the model is already ready and the person needs to feed different types of data in order to justify the same.

Conclusion

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 gave the management a glimpse or the background of the entire population and the way in which it is moving. It requires extensive data crunching and knowledge of statistics in order to do the coding and prepare the model that can be used to test the sample under the given population.

The demand for the quantitative analyst is increasing day by day with the number of statistical software available in the industry, which helps in performing high-level data analysis by using the latest techniques. Many IT companies are now focusing on the quantitative data analysis software since it is in huge demand from the stockbroker and hedge fund managers in order to give a better analysis of their existing portfolios.

Recommended Articles

This has been a guide to Quantitative Analyst Careers. Here we provide the list of top 4 Quantitative Analyst Roles that a person can reach in his career, including Statistical Analyst, Front Office Quantitative Analyst, Risk Management Officer, Model Validation, etc. You may also have a look at the below articles –

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