Ms Statistics concerning about jobs outlook

[Tyler Tuan]

Hi all,

I am currently a masters student in statistics at Stanford. I mostly study statistical learning (quite rigorously), and will take few courses on classical finance math with basic measure theory stochastic calculus including implied volatility.

Due to having no experience. I have following concern about the jobs outlook for statisticians:

1. There are how many types of quantitative traders? And which types are suitable for statisticians?
2. Which fields in finance use a lot of statistics?
3. If I apply for my first job for example at Goldman Sachs, which department I should apply for if I want to become a trader?
4. What is the jobs outlook for statisticians in Singapore and Hong Kong?

(Since I have no experience, sorry if my questions sound naive or overlap)

Thanks much!

 

[Ken Abbott]

Your question is not naive at all. Right now, there are many people chasing few plum jobs. All firms are under cost cutting pressure. I'm afraid that many people who think that finance is the ticket to easy money will be very, very disappointed. Trading will be migrating increasingly to non-bank participants as most "prop" trading will not allowed in US banks. Similarly, in Europe, the Vickers and Liikenan proposals will decrease demand for trading skills there. The non-bank jobs are likely to be "high-beta" jobs where the number of people employed is very much a function of how the market is doing.

To learn about job types, read the material made available throughout this website. You'll find that in addition to trading, stat is used in risk, model review, portfolio management, and price verification

 

[Tyler Tuan]

Your question is not naive at all. Right now, there are many people chasing few plum jobs. All firms are under cost cutting pressure. I'm afraid that many people who think that finance is the ticket to easy money will be very, very disappointed. Trading will be migrating increasingly to non-bank participants as most "prop" trading will not allowed in US banks. Similarly, in Europe, the Vickers and Liikenan proposals will decrease demand for trading skills there. The non-bank jobs are likely to be "high-beta" jobs where the number of people employed is very much a function of how the market is doing.

To learn about job types, read the material made available throughout this website. You'll find that in addition to trading, stat is used in risk, model review, portfolio management, and price verification

Thanks so much for the information, Prof Ken.

Since I am interested in trading, I am interested in portfolio management as well. As I read on PM, it seems to use a lot of statistical tools and optimization; however, I can't see any derivative pricing, stochastic calc and Black-Scholes in this part of finace. Therefore, here I come up with few additional questions:

1. Does PM use a lot of derivative pricing models and stochastic calc?
2. I'm thinking to take a course in undergrad Lesbegue measure, do you think it would be helpful?
3. How do a statistical guy, a stochastic guy and a numerical guy differ in term of jobs function and field in finance? (Still, especially in trading)

 

[Ken Abbott]

1. More QP than PDE stuff
2. I don't know
3. This is a much longer discussion. I'd ask the questions separately in the forum. Stat is used in risk a lot.