Quantitative Risk analyst

luoz · 4/26/14

Hi guys

I've the opportunity to work as a quant. risk analyst. I've already searched the web and found this interesting discussion here about risk management in general. Maybe some of the more experienced professionals within this forum can give their two cents about future prospect and the work in general.
Since I have no other experience in the financial sector it is rather hard for me to value this particular job. Obviously I'm also interested in a pure quantitative analyst job. So it would also be interesting to see the differences, the possibility to move in either direction etc.
I'm very thankful for any new insights!

cheers

luoz

Ken Abbott · 4/26/14

The workload in risk has increased by an order of magnitude since the crisis. A lot of it isn't glamorous, but it is engaging and a great place to cut your teeth. I say that because at some point, most people need to "put in their time." I don't mean to say it's just time-in-grade, but rather to suggest that most people I quant jobs need to get their 10,000 hours. For some, it's running hundreds of thousands of regressions (for me it was, anyway). For others it's writing tens of thousands of lines of code. For still others, it's reviewing hundreds (if not thousands) of models.

If you have a foot in the door at a respectable firm, take advantage of that.

Good luck.

luoz · 4/27/14

Thanks a lot for your answer and insights. I really appreciated it! Maybe some additional questions: Are quant. risk analysts regarded as real quants within the financial area? So after getting some experience as a quant. risk analyst one has still the opportunity to move towards the front office (if wanted). At least it isn't a drawback? Since I have no experience I just want to leave all doors open

Again, I'm very thankful for any new insights.

Ken Abbott · 4/27/14

luoz said:
Thanks a lot for your answer and insights. I really appreciated it! Maybe some additional questions: Are quant. risk analysts regarded as real quants within the financial area? So after getting some experience as a quant. risk analyst one has still the opportunity to move towards the front office (if wanted). At least it isn't a drawback? Since I have no experience I just want to leave all doors open
Again, I'm very thankful for any new insights.

Probably not a drawback, but there is some (unfounded) fear of bringing back office expertise into the front office after UBS, SocGen and Barings, but mostly wrt operations.

Cornholio · 4/27/14

Ken Abbott said:
Probably not a drawback, but there is some (unfounded) fear of bringing back office expertise into the front office after UBS, SocGen and Barings, but mostly wrt operations.

Those guys had intimate knowledge of trade booking systems and how to game them. So I'm not sure that that would be considered a risk when considering at a risk quant for a "front office" quant position (who would not really have this sort of "expertise").

Ken Abbott · 4/27/14

Me

Cornholio said:
Those guys had intimate knowledge of trade booking systems and how to game them. So I'm not sure that that would be considered a risk when considering at a risk quant for a "front office" quant position (who would not really have this sort of "expertise").

Metaphysical truth has nothing to do with it. It's about perception.

The simple fact is that there's less mobility than there used to be. This is one reason.

luoz · 4/27/14

Ken Abbott said:
Probably not a drawback, but there is some (unfounded) fear of bringing back office expertise into the front office after UBS, SocGen and Barings, but mostly wrt operations.

Very interesting insights. Why exactly these three firms? Could please explain what you mean by

Ken Abbott said:
....but mostly wrt operations.

Once more, thanks for sharing your experience.

Ken Abbott · 4/27/14

luoz said:
Very interesting insights. Why exactly these three firms? Could please explain what you mean by

Once more, thanks for sharing your experience.

These firms were all victimized by people with back office expertise using their skill to perpetrate fraud. I am unaware of anyone in risk management involved in anything nefarious, but we do often gain a very, very detailed knowledge of the data plumbing.

Cornholio · 4/27/14

luoz said:
Very interesting insights. Why exactly these three firms? Could please explain what you mean by

A few links regarding these cases:

SocGen :http://en.wikipedia.org/wiki/Jérôme_Kerviel
UBS: http://en.wikipedia.org/wiki/2011_UBS_rogue_trader_scandal
Barings: http://en.wikipedia.org/wiki/Nick_Leeson

Though arguably Iksil broke the trend of the "up-jumped" back office villain.

luoz · 4/29/14

Ken Abbott said:
These firms were all victimized by people with back office expertise using their skill to perpetrate fraud. I am unaware of anyone in risk management involved in anything nefarious, but we do often gain a very, very detailed knowledge of the data plumbing.

Since I've read a lot of bad things about BO/MO jobs I just want to be sure to not make a mistake. I've searched the web and found two similar job descriptions here and here. Would you say this is a quant job and leaves the door open?

Ken Abbott · 4/29/14

luoz said:
Since I've read a lot of bad things about BO/MO jobs I just want to be sure to not make a mistake. I've searched the web and found two similar job descriptions here and here. Would you say this is a quant job and leaves the door open?

The is always some flexibility, but I have seen much less over the past few years. Don't take a risk job if your aim is to do something else. If you really want to do a front office job, hold out for that.

luoz · 4/29/14

Ken Abbott said:
The is always some flexibility, but I have seen much less over the past few years. Don't take a risk job if your aim is to do something else. If you really want to do a front office job, hold out for that.

I think you got a wrong impression. The job seems very interesting, but the point is this: I have a master from a top tier university and spent a lot of time for my studies. Since I have no job experience I just want to avoid making a decision which will more than influence my future prospect. I would have the same worries with an FO job, but as said the move FO -> MO/BO is much easier. But you would regard such job as above as quant and a real BO job?

I'm very thankful for your patience

Ken Abbott · 4/29/14

luoz said:
...the move FO -> MO/BO is much easier. But you would regard such job as above as quant and a real BO job?

1) The move from FO to BO isn't that easy either. Movers are often regarded with some suspicion as people who are between FO jobs and looking for a place to hang out. They also rarely have the econometric skills and knowledge of regulation that is required.

2) The top quants in risk are as good as any I've seen. They do very well.

Keith Tan · 4/29/14

luoz said:
Since I've read a lot of bad things about BO/MO jobs I just want to be sure to not make a mistake. I've searched the web and found two similar job descriptions here and here. Would you say this is a quant job and leaves the door open?

i guess ken could be or possibly be related to the hiring manager of these job descriptions here. #justsayin

Andy Nguyen · 4/29/14

Keith Tan said:
i guess ken could be or possibly be related to the hiring manager of these job descriptions here. #justsayin

You don't say

Ken Abbott · 4/29/14

Keith Tan said:
i guess ken could be or possibly be related to the hiring manager of these job descriptions here. #justsayin

I was unaware of these particular openings until I clicked the links (although as risk COO, I am generally aware of the large number of opening in risk overall.)

Quantitative Risk analyst

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