Best internships for Quant Trading?
Hey fellow monkeys,
I'm really hope to work in a quantitative hedge fund (I find the intersection of finance, computing and math super interesting, have been trying to learn how to create my own trading models + use quantopian) but as a pure finance major (With a minor in mathematics and a minor in computing...my school doesn't allow for a double major sadly), I'm having a super hard time finding opportunities to do quant internships, as such I find myself only getting replies from IBD and S&T departments in my country.
I intend to take up a Masters in Financial Engineering once I complete my undergraduate studies, but as of now, what sort of internships should i take up?
IBD? - For the valuation / modelling skills + the grit of working super long hours
S&T?- For trading skill and knowledge
or is there a third alternative that might be better?
I really appreciate any help! Thanks so much! :D
The IBD investment would be pretty useless for trading - I would say S&T with no hesitation (I have interned in both S&T and IBD). In IBD, you tend to look at investments with a long-term view, in light of synergies, the riskiness of cash flows, potential future takeovers, operational improvements... trading is another beast entirely.
Thanks for the reply! Damn..., I've been applying for IBD internships pretty aggressively because it had a lot more exit opportunities, shall refocus on more trading firms around my area.
really appreciate the feedback!
A STEM major is a far better option than finance. Every quantitative firm I know expects new hires to come in with zero finance background, and some even prefer that so they can teach you from the ground up.
As the person above said, IBD is completely irrelevant, S&T is much better, but only if you can land on a quantitative desk. Usually the quant desks at BBs recruit separately from the pipeline (I know that's the case at JPM and BAML with quantitative trading analyst roles, MS/GS have strats that can be placed on a desk).
The pool of candidates quant firms recruit from does not overlap much with the traditional IBD/S&T group. Two Sigma/Citadel/AQR/Jump are looking for kids who are also looking at being software developers or data scientists at Facebook/Google. Really the only similarities between a quant firm and an investment bank are that they operate in the same markets.
I've been through the recruitment process at a number of quant hedge funds, algorithmic trading firms, and electronic trading desks at BBs. All of my interviewers had STEM (particularly math and CS) backgrounds. None of them asked me any finance questions (one quant HF did, but just to see where my knowledge was at). The sorts of questions I was asked were along the lines of linear algebra, probability, mental math, stochastic processes, and algorithm analysis, along with some coding stuff. The people I talked to who work in the industry said the best major going forward is CS, and that proficiency and comfort writing code is mandatory.
Wow, thanks for such a detailed reply! However, i'm pretty constrained by the majors that i can pick due to my school's limitations (I go to a school with a UK system, so we choose our major before enrolling into college).
That's a little disheartening to hear, I've heard similar things and to best way I can compensate for that would be to take up a minor in math and computing. Looking forward, I'm definitely going to aim for a masters in Financial engineering, would that help much?
I've taken up programming in my free time as well, are there any extra curricular things I can do to help boost my chances to land a quant desk internship provided my almost pure finance background?
Thank you so much for your help! I really appreciate it!
If you plan to go to get a Masters, it's probably more beneficial to do so in applied math or computer science. Those are more rigorous quantitatively than financial engineering, and with a finance background you'll want to demonstrate that you can handle the numbers just as good as other candidates with math/technical foundations. That's not to say that an MFE is useless, but you'll have an uphill battle to prove that you can do the quant work so you might as well go all the way in.
The best thing is just to focus on activities that require strong technical ability. Python and C++ are the languages to know, and being an expert in C++ will absolutely be a positive. It's a hard language, but it's so important that being able to operate fluently in it will set you apart. It's harder to list math ability on a resume, but do take some high-level math classes (stochastic processes/calculus, analysis, ODE/PDE) and list those.
I think the moral of the story is you have the burden of proving you have the quantitative skills despite coming from a non-quant background. But the positive side is it's no secret what you'll have to learn/know, so if you become incredibly strong in those areas and can show it, a firm would be stupid to say no just because you didn't have the right major despite having all the necessary skills.
This is exactly the comment I wish somebody told me before I chose to be a finance major.
Now I'm taking a senior-level class that teaches algo trading, and I'm loving it. And now I'm thinking, shit, I want to learn more about this, but have neither the option of doing CS undergrad nor the prereqs done to get into an MFE program.
I am in the same situation as you! I have an interest for math and computing, but took up the finance major because i loved finance and wanted to work in the finance industry. It was only after taking the major then did i realise I wanted to work in the Quant Fin sector. Now the best I can muster up is a minor in Math and a minor in computer science.
Trying to spend my free time learning on trading algo development, or learning advanced math! I've read at other places that a high Quant GMAT (Or was it GRE?) score helps for placement into some top MFE programmes so it's still possible!
All the best man!
For a sophomore engineering student, would you recommend a data science internship over a back/middle-ish office position at a reputed quant fund or I-bank?
I'm not sure a sophomore (or an investment banker for that matter) is qualified to decide what is back office at a quant fund. Most jobs at a quant fund that involve programming and do not involve maintaining servers or legacy code are essentially FO. But over an investment bank, yes.
What's stopping you from learning programming on your own and coming up with some side projects? You can learn literally any language online for free. Just go do it.
and don't reply asking for resources - step one to learning programming is figuring it out on your own.
but for starters - go build a model on Quantopian or something. Make it publishable.
You're absolutely right! That is the path I'm trying to go on right now since my finance major limits my exposure to Quant work. Working on Quantopian now :) thanks for the tip!
No problem. We considered using Quantopian to test candidates for our job opening (ended up going a slightly different direction). So being able to actually apply and demonstrate what you know is not just a 'nice-to-have' (at least for us).
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