Hi.
I am a math student, and I am a strong communicator. So, I think I have the skills for both.
Would appreciate if you guys could help me compare these jobs.
Things I mostly care about:
1) Salary
2) Career growth (within firm)
3) Culture
4) Stability/ Future Outlook
5) Ceiling Salary
Provided you had the skills for both, would you rather be a Quant or IB?
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Studying maths is not enough to be Quant. You have to be really smart and Msc is really the minimum.
However, IB role is probably more interesting and exciting and opens doors in more industries.
I think that if you are not very interested in IB, then you shouldn't do it, cause you probably wouldn't enjoy it. If you really want to do IB, then do it.
Answered very well. I am a quant developer that worked in IB for 2 years before jumping boat.
Being a Quant analysist is not easy, most quants are math or physics phd who published some great papers, some were researchers who spent years on mathematics.
Also as long as you messing with someone else money your job security will always suck.
Yeah, fair. I have no clue why I got 3 MS lol
So you might already have this information but I think you are missing the most important questions around what the work is like so that you can figure out whether or not you’ll enjoy it. I say this because no matter how smart you are, if you don’t truly enjoy the work you’ll get leapfrogged by people who are just as smart but love what they do (or close to it).
Another thing to keep in mind is that “quant” is a word that is thrown around and means different things to different people. Even being more specific around “quant researcher/signals research” at a HF, can be pretty different (time horizons, how “mathy” the role is, asset classes, systematic vs pure quant, etc). So the answers you’ll get are pretty different. Similarly, IB covers a lot so you might want to be more specific.
Things that’ll be hard to get a good answer on: - culture - this is firm dependent, team dependent, etc. It’ll be difficult to get an answer on this - career path/upward mobility within firm - will also be difficult to answer. The thing to keep in mind here is around future opportunities, IB is a bit more general and after a 2 year stint as an analyst you have the business school/VC/HF/PE options, while quant is a bit more specific and you will generally have fewer exit opportunities (especially at the level of pay). Additionally, quant funds will tend to have non competes, so that’ll also be something to think through.
As for comp, entry level will be higher in quant but with fewer opportunities (as these are really only the top firms). The IB path is a bit more defined if you can get into PE, etc, and more stable, while the vol in quant is higher, and if you are doing alpha research the ceiling is also higher than “pure IB”. But really after about 5-7 years on the quant side the differences in comp between the top people and the average is large, and it is way too hard to predict this well (I.e. some people will still be around $300-400k, while others will be 7 figures). Again the IB path here is a bit more defined (up until senior VP/MD where comp across people diverges significantly).
Thanks for your reply. Either I want to become a quant researcher at at top HF or M&A BB/ EB. Could you help me compare these jobs. Would you rather be a Quant or IB?
Also debating a similar topic right now
What would I rather be? Well that’s easy because I’m already at a HF and I would take the HF route (and have been in the field for a while).
The problem with that question is that: 1) it is hard to get into the top HF’s out of undergrad 2) the risk around a HF is much higher (in pay but also just job security) 3) the skill set you learn at a HF (obviously varies by firm) is more limited (or is perceived to be more limited) than a more generalist in IB 4) the non competes are much stricter in the HF space 5) the stress associated with HFs, in my opinion, is higher and everyday there is more work than you can get through.
I could go on, but you have to look at the probability of success in these roles and what it means (and the risk of failure at HF is real, much more real than IB).
Now I love what I do, I find the problems very interesting, I enjoy the math, I enjoy having a fair bit of autonomy, of trying to beat markets every day, of trying to think of new ways to analyze the markets, etc. So if you love this stuff and you find the right firm it can be incredibly rewarding. But do know that the people you are up against are essentially thinking about markets 24/7, while the hours aren’t like they are in banking, you need to be on top of everything if you want to succeed.
I did IB first, then left for a quant shop. Mostly hated it and realized I want to be a fundamental manager. Went back to IB briefly to polish the fundamental skillset a little further, and now do fundamental.
My problem with quant was it wasn't going to be a great long-term growth path for me because I wasn't able to see a powerful edge to be had through doing simple work with widely available data, which is what too many firms do. The firms I knew about, including the one I was at, were developing pretty basic strategies and relying on the public's recent fascination with all things "big data" to boost their AUM in the near term instead of developing a deeper and more sustainable edge for the long term.
That's great if you're the CEO or the senior sales staff. Get rich today, why not. But if you're a junior or midlevel looking to make his own mark on the firm, there was little avenue for that without an appetite to innovate further.
Designing an algo that will reliably beat the market long-term, with the additional caveat that it will need to be able to do this while managing lots of money, is too hard for most of the quant firms today. No doubt some are doing it or developing it. But I dont' think its most of them. I would encourage any candidate in this area to be very skeptical of the firm's edge and make sure you join a place that is being very thoughtful about it. Any strategy that just targets a laundry list of metrics is going to have it's edge diluted quickly because everyone and their mom is working on something.
But what would the alternatives be for Quant? If you could start over, what would you choose? IB, PE, traditional HF, Tech...? What HF are still great for quants?
Renaissance Technologies 2Sigma DE Shaw
Again quant is just too general of a term. If you are saying would I learn how to use technology (specifically coding) and analytical techniques to solve problems (specifically in finance), then yes I would do that again. Being able to write logic and use data to analyze problems is a very useful thing to learn across many industries and I think is important for being able to consistently produce results in the finance world (and in general).
But the reasons why I would do HF again are mostly because I enjoy the work (and of course it pays well), others have a different set of criteria (stability? Maybe people want a more relationship based job? Want to tackle different types of problems, Etc). Which is why asking these questions is fine but I don’t think it’ll be that helpful. Understanding why I’d do it again should at least be a bit more helpful because you might hold very different values/priorities).
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