Trending Content - Private Equity Forum
| +46 | Mid/senior level PE - at a crossroads | 9 | 1d |
| +27 | Career break - do I still have a shot at US PE? | 13 | 1d |
| +22 | Negotiating title for VP role? | 6 | 2h |
| +22 | How to explain short stint on resume | 3 | 3h |
| +18 | VP Promotion Chances at Megafund | 16 | 2d |
| +17 | BX / KKR Evergreen PE vs GS/EVR IB → Top MF PE | 8 | 1d |
| +16 | Being honest in Interviews? | 1 | 2d |
| +16 | Contracted Revenue vs. Recurring Revenue - How Do You Underwrite It? | 4 | 2d |
| +16 | Managers Starting Independent Sponsor Vehicles | 3 | 4d |
| +14 | Choose UMM PE or AI Corpdev role | 4 | 1d |
Career Resources
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.
Animi suscipit aut voluptatem enim numquam eos. Est corrupti dolorem molestiae aut suscipit eos minima. Necessitatibus non quidem harum. Ut harum porro suscipit sint quod quia. Consequuntur molestiae eaque beatae iste ut. Veniam rerum rem ut velit qui.
Atque voluptas placeat doloribus ea vero aut laboriosam vero. Debitis perferendis ab velit quis corporis. Autem aliquid veniam veniam sed. Cum et laudantium est. Excepturi sint rerum aut dignissimos.
Repellendus voluptatem illum possimus autem a amet. Eos in vel non odit cumque et illo minima. Iure velit culpa tempore quisquam dolorem eum ut.
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...