Trending Content - Private Equity Forum
Career Resources
WSO Free Modeling Series - Now Open Through
June 30, 2026
9 Free Financial Modeling Lessons
Get instant access to lessons taught by experienced private equity pros and bulge bracket investment bankers including financial statement modeling, DCF, M&A, LBO, Comps and Excel Modeling.
+Bonus: Get 27 financial modeling templates in swipe file
+Bonus: Get 27 financial modeling templates in swipe file
High Finance Applications
Guaranteed
Get at least one offer GUARANTEED
- 1:1 support
- 92% success rate
- 2,000+ mentor network
- Unlimited Live bootcamps
- AI for resume + LinkedIn
- Networking automation tools
- HireVue simulation tool
- Full course library
- Private Slack community
- 20hrs of mocks
- + much more...
what is financial engineering, didn't have it at my school, how does it differ from straight finance
Using quantative methods to develop and trade in derivative products in rder to hedge risk.
You'll get a better explanation on wikipedia
i guess you'd use some interest/currency swaps where appropriate, if that counts
yea i think you're right.
Financial eng is also looking at restructuring the comany's balance sheet, subsidiaries and debt structure.
often by reengineering and gearing, you can achieve better ratios, also better return on equity for the core business. selling it into parts that sum up more than the price you paid for it is also a commonly used technic
Maybe the PE shops just want people that took really hard finance classes like Stochastic calculus, so they know balance sheets are easy for you. I have not heard of this recruiting practice though.
Stochastic calculus has nothing to do with balance sheets.
just means structuring a LBO and subsequent recaps (tinkering with capital structure put in place) in order to profit instead of operationally turning around the company for profit. The big buyout funds (KKR, Bstone, etc) are known for this (somewhat hands off approach with company after they purchase). It is not financial engineering from school, just a term used in the PE industry, not really that complicated
Financial engineering in the conventional sense of the term is used mostly by trading desks and quant funds. FE in PE is totally different work, like capital structuring, recaps, LBO, etc. So some overlap of skills.
From personal experience, PE firms are gong towrds Real Options Analysis as this gives them a better view of future events.
Vel labore eos rem voluptas. Vitae earum dicta dolor aliquam nulla id ad voluptatum. At voluptatum harum sunt dolor dolorum amet dolor. Officia sint deserunt ab sed et molestias consequatur.
Hic nobis officiis deserunt deserunt eos rerum. Sed quam illum velit adipisci ut delectus aut placeat. Exercitationem id ut inventore et esse voluptatem. Cumque et quasi est quibusdam autem.
Enim et voluptatem aut reprehenderit. Commodi quos ut impedit sed.
Omnis sint sed delectus quam id quia et et. Fugit rerum corporis in enim praesentium. Voluptatem aut laboriosam id unde corrupti ducimus. Rerum ipsa dignissimos ut commodi. Inventore velit non odio consequuntur inventore. Voluptas nisi aut est perspiciatis. Earum nihil quasi placeat fuga error omnis.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...