CFA vs FRM vs PRM for Hedge Fund

[Saoud Alanjari]

Hello,

I am currently working as an assistant actuary at a reinsurance firm and was planning on moving to a Hedge Fund as a quant. Hence, I was wondering which certification would be the most useful (Both career-wise and knowledge-wise) for someone working at a Hedge Fund as a quant. I am considering doing either the CFA, FRM, or PRM. I have the following educational background:

• BS in Accounting and Business Economics with a Minor in Mathematics (even though I was only two courses short of obtaining a 3rd Major in Mathematics)
• MS in Mathematics from NYU (My coursework included several quantitative finance courses)
• Completed Exam P, Exam FM, VEE-Economics, VEE-Economics, VEE-Applied Statistical Methods from the Society of Actuaries

Which certification(s) would you suggest? Also, do any of you think it would be a good idea to also work towards a FSA-Quantitative Finance and Investment track?

 

[pingu]

You don't need no stinking certification to work at a hedge fund. Don't waste your time and money.

You just need to try to get a job at a hedge fund (whatever means necessary).

 

[Saoud Alanjari]

However, if I am already working in a hedge fund, which certification(s) would be good to have in order to advance my career as well as my skills?

 

[ZHOU QIAO]

Hi Saoud,

A little about myself: I've been working on hedge fund industry for a few years as a quant researcher and trader. I passed 2 levels of CFA and part 1 of FRM. I'll be joining Berkeley MFE next year. I personally feel that none of them is strictly required, although CFA is good to have. FRM is rarely used in my work.

Depending on the types of hedge fund you are targeting, the answer may vary. If you are targeting at a high-frequency/short-term systematic fund, none of them will add much value; for fundamental equity/global macro/asset allocation type of fund, CFA will often be beneficial.

If I'm given a chance to choose again, I would probably not take CFA/ FRM in the first place. I believe math, programming, machine learning, etc., have become increasingly more crucial in the quant traidng space if one wants to maintain a profitable edge. Put aside certificates and fancy theories for a moment. Watch the market, dive into data and try to model things using logic and intuition.

Cheers!
Qiao

 

[pingu]

However, if I am already working in a hedge fund, which certification(s) would be good to have in order to advance my career as well as my skills?

None.

 

[Saoud Alanjari]

Hi Saoud,

A little about myself: I've been working on hedge fund industry for a few years as a quant researcher and trader. I passed 2 levels of CFA and part 1 of FRM. I'll be joining Berkeley MFE next year. I personally feel that none of them is strictly required, although CFA is good to have. FRM is rarely used in my work.

Depending on the types of hedge fund you are targeting, the answer may vary. If you are targeting at a high-frequency/short-term systematic fund, none of them will add much value; for fundamental equity/global macro/asset allocation type of fund, CFA will often be beneficial.

If I'm given a chance to choose again, I would probably not take CFA/ FRM in the first place. I believe math, programming, machine learning, etc., have become increasingly more crucial in the quant traidng space if one wants to maintain a profitable edge. Put aside certificates and fancy theories for a moment. Watch the market, dive into data and try to model things using logic and intuition.

Cheers!
Qiao

Then would the CQF be more suitable since it is a designation specifically meant for quants?

 

[pingu]

Then would the CQF be more suitable since it is a designation specifically meant for quants?

Yo, WTF!?

if you want to give money out and waste time, go ahead. Start with the CFA, after 3 years, do the FRM. Then after 2 more years, finish the CQF. You are in luck! Last time I check, CQF is just 1.5 years.

6.5 years from now and thousands of dollars burnt, you will have 3 pieces of paper that could help you start from zero as a quant.

 

[Saoud Alanjari]

So pingu, what advise would you give in obtaining or securing a quant job at a hedge fund?

 

[Saoud Alanjari]

Also, what is your experience in the financial services industry?

 

[pingu]

So pingu, what advise would you give in obtaining or securing a quant job at a hedge fund?

Network.

 

[InvestmentActuary]

Dear OP,

I'm a qualified actuary and CERA with the investment track and I'm currently doing the CFA (while working in a quant act/hedging/c++ role) and I'm saving for my MFE.

Things I know for sure? You won't get a second look at a hedge fund, forget that until you have either a PhD or 8 years+ actual work experience (reinsurance won't count unless your transacting derivs).

CFA is good, but dont expect anyone to recognise any of the actuarial exams, they didn't with me.

Make sure you have a Msc, most headhunters screen for MSc or PhD. This is especially frustrating for me as I have a BSc in actuarial science and stats from a british uni which is more fleshed out and focused than most MSC in stats here in the US (sorry US grads).

Anyway, in a nutshell - do the MFE and if you cant afford that right now do CFA + FRM and get programming experience in the interim.

Forget Hedge funds though, focus on the bulge brackets first.

 

[Holly_X]

Hi Saoud,

A little about myself: I've been working on hedge fund industry for a few years as a quant researcher and trader. I passed 2 levels of CFA and part 1 of FRM. I'll be joining Berkeley MFE next year. I personally feel that none of them is strictly required, although CFA is good to have. FRM is rarely used in my work.

Depending on the types of hedge fund you are targeting, the answer may vary. If you are targeting at a high-frequency/short-term systematic fund, none of them will add much value; for fundamental equity/global macro/asset allocation type of fund, CFA will often be beneficial.

If I'm given a chance to choose again, I would probably not take CFA/ FRM in the first place. I believe math, programming, machine learning, etc., have become increasingly more crucial in the quant traidng space if one wants to maintain a profitable edge. Put aside certificates and fancy theories for a moment. Watch the market, dive into data and try to model things using logic and intuition.

Cheers!
Qiao

cannot agree more! However, in order to get the ticket to the quant world, I believe certifications can be of help to some degree.

 

[Quant physician]

If you have one or some of these factors that will be your ticket to hedge fund manager role :

1. You have clients willing to invest millions of dollars in you.

2. Your family run their own hedge fund.

3. Gold medal at the international mathematics Olympiad.

4. Phd in physics , math or machine learning with extraordinary research/ talents.

 

[yetanotherquant]

If you have one or some of these factors that will be your ticket to hedge fund manager role :

1. You have clients willing to invest millions of dollars in you.
2. Your family run their own hedge fund.
3. Gold medal at the international mathematics Olympiad.
4. Phd in physics , math or machine learning with extraordinary research/ talents.

1. and 2. - yes but I highly doubt the power of 3. and 4. (I mean 3. and 4. may help and definitely won't hurt but do not expect too much from them)

 

[pingu]

3. Gold medal at the international mathematics Olympiad.

4. Phd in physics , math or machine learning with extraordinary research/ talents.

Number (3) and $2.75 will give you a ticket in the NYC subway, that's about it.

If your talents in number (4) don't translate to real life (extremely common), you are going no where.

 

[Alfa beta]

Anyone who goes further than cfa level 1 is an idiot. It's merely used for admission purpose and to signal that I know the basics and improve your chances.

A real good name Masters degree always trump these distance learning certificates.