Disappointed with MFE grad salaries

[amateur-quant]

I knew the salary before applying to several MFE programs. But I applied nonetheless. And now that I have gotten acceptance from couple of programs, and waiting for several other programs, I deep dived into the salary structure here at qauntnet and talked with fresh mfe grads. And I am sad to report that the salaries are not that great, according to me and my criteria.

I mean, 130-140K (except top 2 schools, every other has this salary range) is okay but it's not commensurate to the amount of work needed to get into a top program and then 10x work needed to graduate from the program. I might be disillusioned, I don't know. Having around 4 years of work ex as a software engineer, I can make more than this just doing what I do.

I am well aware of the adage that one should do it if they are interested and not for money. But money is an important factor. I like quant finance and want to build a career in it but I want good money too. Am I expecting too much too early ?
Though the highest pay at these top schools does cross 220k, but there are very few who get that. One can try their best to be in that top 1%.

How is life after 4-5 and 9-10 years down the line in terms of money, please share if you have any idea. Is the world rosy or should I temper my expectations ?

I apologise if I come out as a thankless idiot. I am grateful for what I have gotten. Just ranting here after going through the salaries of these programs.

 

[aweix]

Baruch MFE provides a 5th-year career report: https://mfe.baruch.cuny.edu/wp-cont...nt-Career-Development-Report-January-2022.pdf

This is the most recent one, and even though it’s a couple years old, you’ll see that for graduates employed at hedge funds, median compensation is ~450k. It’s really variable and depends on the type of employer, but compensation does increase quite a lot as you progress in your career.

I think it’s also worth noting that most grads have far less than 4 years of full-time work experience - you might be justified in revising your expectations to be a little north of the median because you’re a relatively experienced hire.

 

[Andy Nguyen]

Good discussion @amateur-quant. I think you are right to have a different expectation compared to those coming from MFE programs directly from undergrad with no work experience. For them anything north of 100K/year is a huge amount of money but for those working as SWE or those familiar with FAANG salary level, it's not that impressive if you live in high cost cities like NYC or west coast.
What you need to look for is how the program will put someone with relevant experience into roles that argument their work experience and not something for fresh graduates.
If you are focused on maximize your potential earning over your life time, you need to get into programs that can help you throughout your career, not only when you first graduate. I know Baruch MFE help their alumni when their switch jobs years after graduation. Their alumni network is really extensive and many of their alumni can earn over a million a year in total comp.

 

[kombuchalover]

I am in the same boat as you… been in SWE over a year now and the idea of quitting my job to study something I am interested in is hard when there is little salary increase tied to it. The opportunity cost is a hard thing to weigh. Let me know what you decide. PM me if you want to talk more!

 

[Andy Nguyen]

I would point this out that the data you see is not always as accurate as it should be. The placement data is voluntary and not everyone student reported their salary and not every program collects the data. What you end up is a small sample of data when it is presented in the best light possible.
My suggestion is to approach the data with caution. Ask the programs how the data is collected and calculated. The best programs would be more than happy to answer these.

 

[_quanty_]

Check this out: MSCF Alumni Career Insights - Master of Science in Computational Finance - Carnegie Mellon University

And this: Financial Engineering Salary - Master of Science in Computational Finance - Carnegie Mellon University

Really great info.

 

[bootstrap]

Baruch MFE provides a 5th-year career report: https://mfe.baruch.cuny.edu/wp-cont...nt-Career-Development-Report-January-2022.pdf

This is the most recent one, and even though it’s a couple years old, you’ll see that for graduates employed at hedge funds, median compensation is ~450k. It’s really variable and depends on the type of employer, but compensation does increase quite a lot as you progress in your career.

I think it’s also worth noting that most grads have far less than 4 years of full-time work experience - you might be justified in revising your expectations to be a little north of the median because you’re a relatively experienced hire.

I am just wondering....what percentage of MFE grads actually achieve a 450k comp, say, five years out? You probably have to be with a hedge fund and not a bank or a long-only house? But how many of such hedge fund jobs are really out there. And how much competition you will face for those jobs, especially from all those STEM PhDs disaffected with academia?

 

[QuantCoach]

I am just wondering....what percentage of MFE grads actually achieve a 450k comp, say, five years out? You probably have to be with a hedge fund and not a bank or a long-only house? But how many of such hedge fund jobs are really out there. And how much competition you will face for those jobs, especially from all those STEM PhDs disaffected with academia?

No you definitely do not have to be at a hedge fund to make that comp five years out. The highest paying hedge funds and prop shops (Jane, Citadel, HRT, 5R) are 500k+ new grad, not five years out. Maybe one person per top MFE program per year will land this. IMC/DRW/SIG/OMC pay near 400k new grad, can get to ~450k in second year depending on a function of firm and personal performance. Around 2 to 5 people per top MFE program land this per year.

For the competition, usually <20 out of a few thousand candidates get to the superday, <5 get the offer per firm (FT, not returning intern). These candidates are primarily HYPSM undergrads for QT and a mixture of bachelors, masters and PhDs for QR. MFEs are a very tiny part of their recruiting pipeline.

That being said, a lot of people see the salaries and keep on asking about how to land these jobs without putting any time in. This is years of building your resume prior to even joining the MFE, thousands of hours of interview prep, without any guarantee you’ll get anything out of it. The NBA pays millions to new grads too but for some reason people have more reasonable expectations about their chances playing in the NBA than they do for working in JS (I saw a guy spamming threads here about how they only want to get to JS…)

Also, what a lot of people don’t mention is even if you land these jobs, there’s a lot of sacrifice you start to realize when you start working. There is very high work expectations, this industry is not about valuing WLB, it’s about valuing being the best and doing everything you can to get there. All the money also doesn’t make you as happy as you might think, it makes you desensitized.

 

[bootstrap]

No you definitely do not have to be at a hedge fund to make that comp five years out. The highest paying hedge funds and prop shops (Jane, Citadel, HRT, 5R) are 500k+ new grad, not five years out. Maybe one person per top MFE program per year will land this. IMC/DRW/SIG/OMC pay near 400k new grad, can get to ~450k in second year depending on a function of firm and personal performance. Around 2 to 5 people per top MFE program land this per year.

For the competition, usually <20 out of a few thousand candidates get to the superday, <5 get the offer per firm (FT, not returning intern). These candidates are primarily HYPSM undergrads for QT and a mixture of bachelors, masters and PhDs for QR. MFEs are a very tiny part of their recruiting pipeline.

That being said, a lot of people see the salaries and keep on asking about how to land these jobs without putting any time in. This is years of building your resume prior to even joining the MFE, thousands of hours of interview prep, without any guarantee you’ll get anything out of it. The NBA pays millions to new grads too but for some reason people have more reasonable expectations about their chances playing in the NBA than they do for working in JS (I saw a guy spamming threads here about how they only want to get to JS…)

Thanks for giving us some insider insights into the hiring landscape. I was posing those questions because I feel that others on the forum might have some unrealistic expectation about the career prospects of an average MFE grad.

As you said, those top hedge funds and trading firms only hire a tiny fraction of the MFE pool every year (maybe 30 across all top programs in the US based on your stats?). So in all likelihood, most of us will be starting out in a 140k job at a long-only house. And as the OP said, the pay trajectory is inferior to that of an average big tech SWE.

So if you are giving up your 200k+ SWE job, putting your career on hold for a year, and shelling out 90k for MFE tuition, you better be really in love with quant research.

 

[_quanty_]

Thanks for giving us some insider insights into the hiring landscape. I was posing those questions because I feel that others on the forum might have some unrealistic expectation about the career prospects of an average MFE grad.

As you said, those top hedge funds and trading firms only hire a tiny fraction of the MFE pool every year (maybe 30 across all top programs in the US based on your stats?). So in all likelihood, most of us will be starting out in a 140k job at a long-only house. And as the OP said, the pay trajectory is inferior to that of an average big tech SWE.

So if you are giving up your 200k+ SWE job, putting your career on hold for a year, and shelling out 90k for MFE tuition, you better be really in love with quant research.

Is it fair to compare the average MFE grad salary with the average "big tech SWE" salary? From talking with my CS friends, getting a SWE job at FAANG aint too easy. Compare the average MFE grad salary to the average MSCS grad salary for a fair comparison.

Also, starting your career at 120k-150k is awesome, a real privilege that less than 1% of the world's population gets to do. And your career is 40+ years long. Imagine how high you can go in 10, 20, 30 years. It's so easy to get lost in all the statistics of people making 400k straight out of grad school when most of us will never do that. But we'll still make plenty of money in our lives doing something really cool, which again is something that very very few of the world's population is lucky enough to do. At this point I'm not even replying to your comment haha but I just want to make this point.

 

[bootstrap]

Is it fair to compare the average MFE grad salary with the average "big tech SWE" salary? From talking with my CS friends, getting a SWE job at FAANG aint too easy. Compare the average MFE grad salary to the average MSCS grad salary for a fair comparison.

Also, starting your career at 120k-150k is awesome, a real privilege that less than 1% of the world's population gets to do. And your career is 40+ years long. Imagine how high you can go in 10, 20, 30 years. It's so easy to get lost in all the statistics of people making 400k straight out of grad school when most of us will never do that. But we'll still make plenty of money in our lives doing something really cool, which again is something that very very few of the world's population is lucky enough to do. At this point I'm not even replying to your comment haha but I just want to make this point.

Well I get your point, but the OP does come across as a FAANG SWE lol.

 

[amateur-quant]

Thanks everyone for pitching in.
I personally don't dream about Jane . That train has left the station many years ago.

There is a perception around SWE that quants are making all the bucks. And it is true to some extent also, at least in my circle. I have several friends working in FAANGs and Fin Services (GS, JP, Morgan etc, I work in one of these) as techie who have wet dreams about switching to quant roles, whether it is quant developer at a hedge fund or C++ developer at HFTs. And a few of us who have managed to make this transition are actually raking good money, most of them have made transition as a quant developer to places like Millennium, IMC etc. They get pay at least 1.25 to 1.5, some even 2x times their current pay. And the usual plan is to slowly transition from dev to research role on job itself.

And some of us like me thought that rather than making this transition from dev to researcher or trader, why not do an MFE and directly become eligible for those roles. Or even dev at HFT is perfectly fine.
But when I see the salaries of Post MFE and compare it with my friends who just switched jobs, I see a disconnect.
I don't understand why the pay is less for the same role after MFE than directly applying, maybe the salary is lower because the company offering the salary thinks that they might get fresh grads too for these roles. MBA recruiters would not think like this since they are guaranteed people with work ex and thus the avg. pay is around 175k too.
Or are the companies just hiring at those pay because they can. I mean MIT to have average pay as 140k (assuming that quantnet figure is accurate) just doesn't seems right, one would expect much more from a school like MIT.

And just for clarification, none of my friends or me are expecting the jobs which @QuantCoach is talking about. Those are beyond reach. I have studied with such people. The hard core intelligence is just beyond comprehension, one can't just start thinking like that by working hard or for that matter anything. It either comes in built or from decades of discipline and hard work. I am not saying all those who work at JS are of that category, but the couple of people I know who got a job at JS just out of fresh grad, they are just different kind. An Analogy would be - the gap between 2200 and 2800 player in chess is same as that between 2200 and someone who doesn't play chess.

But all in all, my thinking right now is that in long term mfe would be beneficial. Even if I get the same salary after MFE or maybe slightly lower, once I enter the industry, I would perform and switch. That's the hope for now at least.

 

[bootstrap]

Thanks everyone for pitching in.
I personally don't dream about Jane . That train has left the station many years ago.

There is a perception around SWE that quants are making all the bucks. And it is true to some extent also, at least in my circle. I have several friends working in FAANGs and Fin Services (GS, JP, Morgan etc, I work in one of these) as techie who have wet dreams about switching to quant roles, whether it is quant developer at a hedge fund or C++ developer at HFTs. And a few of us who have managed to make this transition are actually raking good money, most of them have made transition as a quant developer to places like Millennium, IMC etc. They get pay at least 1.25 to 1.5, some even 2x times their current pay. And the usual plan is to slowly transition from dev to research role on job itself.

And some of us like me thought that rather than making this transition from dev to researcher or trader, why not do an MFE and directly become eligible for those roles. Or even dev at HFT is perfectly fine.
But when I see the salaries of Post MFE and compare it with my friends who just switched jobs, I see a disconnect.
I don't understand why the pay is less for the same role after MFE than directly applying, maybe the salary is lower because the company offering the salary thinks that they might get fresh grads too for these roles. MBA recruiters would not think like this since they are guaranteed people with work ex and thus the avg. pay is around 175k too.
Or are the companies just hiring at those pay because they can. I mean MIT to have average pay as 140k (assuming that quantnet figure is accurate) just doesn't seems right, one would expect much more from a school like MIT.

And just for clarification, none of my friends or me are expecting the jobs which @QuantCoach is talking about. Those are beyond reach. I have studied with such people. The hard core intelligence is just beyond comprehension, one can't just start thinking like that by working hard or for that matter anything. It either comes in built or from decades of discipline and hard work. I am not saying all those who work at JS are of that category, but the couple of people I know who got a job at JS just out of fresh grad, they are just different kind. An Analogy would be - the gap between 2200 and 2800 player in chess is same as that between 2200 and someone who doesn't play chess.

But all in all, my thinking right now is that in long term mfe would be beneficial. Even if I get the same salary after MFE or maybe slightly lower, once I enter the industry, I would perform and switch. That's the hope for now at least.

First of all, thanks for starting this discussion. I am sure the back and forth is very enlightening for everybody. We have all learned something new.

As for your confusion...I think you have answered your own question. Your friends that are raking in money are working as developers at Millenium, IMC, etc. And essentially they are still software engineers, just in a different setting. But the hard truth is, most MFE grads are not gonna make it into those firms as developers, let alone traders/researchers. Most of them will be grateful to find jobs at Blackrock, Fidelity, Pimco, GS, JP Morgan, etc. And 140k is approximately what these places pay out to associate-level new hires.

 

[joe_boy]

First of all, thanks for starting this discussion. I am sure the back and forth is very enlightening for everybody. We have all learned something new.

As for your confusion...I think you have answered your own question. Your friends that are raking in money are working as developers at Millenium, IMC, etc. And essentially they are still software engineers, just in a different setting. But the hard truth is, most MFE grads are not gonna make it into those firms as developers, let alone traders/researchers. Most of them will be grateful to find jobs at Blackrock, Fidelity, Pimco, GS, JP Morgan, etc. And 140k is approximately what these places pay out to associate-level new hires.

140k base salary you mean?
It is still possible to get a role in one of the HFTs, but you have to prep really hard. Networking can also be very crucial. It is not as hard as what we sometimes portray it to be. I have seen students get jobs in Jane Street, Millennium etc and they got their MFEs from very low ranked schools, supposedly. Once you have an opportunity to interview, the rest is dependent on your performance. And I believe top MFEs or even middle tier ones will give you that opportunity.

That being said, it is true that only a small fraction will get these jobs straight out of an MFE..But it has very little to do with the MFE itself or the school you get it from. It's about your preparation and how well you can network

 

[Peter Wagner]

I knew the salary before applying to several MFE programs. But I applied nonetheless. And now that I have gotten acceptance from couple of programs, and waiting for several other programs, I deep dived into the salary structure here at qauntnet and talked with fresh mfe grads. And I am sad to report that the salaries are not that great, according to me and my criteria.

I mean, 130-140K (except top 2 schools, every other has this salary range) is okay but it's not commensurate to the amount of work needed to get into a top program and then 10x work needed to graduate from the program. I might be disillusioned, I don't know. Having around 4 years of work ex as a software engineer, I can make more than this just doing what I do.

I am well aware of the adage that one should do it if they are interested and not for money. But money is an important factor. I like quant finance and want to build a career in it but I want good money too. Am I expecting too much too early ?
Though the highest pay at these top schools does cross 220k, but there are very few who get that. One can try their best to be in that top 1%.

How is life after 4-5 and 9-10 years down the line in terms of money, please share if you have any idea. Is the world rosy or should I temper my expectations ?

I apologise if I come out as a thankless idiot. I am grateful for what I have gotten. Just ranting here after going through the salaries of these programs.

I worked in the industry for many years and now own a recruiting business placing SE/QD/QR at top HF and IB's. I have this conversation every day with people. You can't generalize about expected compensation. It varies widely, and there's little relationship to school or degree other than the fact that top performers get into the top schools. At the end of the day, top performers make significant $ due to their contributions and ability to navigate the dynamics of their organization. This takes intellect, emotional intelligence, and strong work ethic. Yes, the foundational skills of your education are necessary for the job. But getting from that starting salary to significantly bigger earnings has low correlation with the degree itself.

 

[Alex Ng]

Just saw this threat from another threat. I'm weighing in because I resonate with some of the posts here.

I think the placement stats are inflated, tbh. Not pointing to any specific programs because this seems to be the case for ALL programs. After all, as Andy said previously on another thread, the stats you see in QuantNet and possibly other sources like Risk.Net are numbers provided by the programs themselves. No verification process at all. So there are many ways where programs can tweak during the info compilation process or outright manipulate the numbers provided to ranking organizations.

About job placement, very few people actually get into hedge fund (at least not anytime soon upon graduation) and make tons of money other than the students graduated from the top top programs (Princeton MFIN, Baruch MFE). Other competitive programs such as Columbia MFE, Cornell MFE, you name it, have struggled in recent years regarding student job placement. Most students, from what I heard from the MFE/FM programs, end up doing asset management, risk management, and investment banking. Not to say that the curriculum and career service have no value to students, but I think the job market and the program quality have reached the point where it is up to the students to learn and take from the curriculum and secure a job. It is not so much as what the programs can provide to the students. So my point is that student quality is increasingly the reason for program success rather than the other way around.

I would also add that (purely coming from what I have seen on social media posts) when students receive multiple offers, their decisions of choosing where to go are highly influenced by QuantNet ranking. I see this as an issue because students spend less time looking at the curriculum and faculty quality. Also, the question remains: just how much can you trust the numbers provided by the programs, especially when the calculated overall scores are so close?