Advice needed about pursuing MS in financial engineering

[TSGannGalt]

This recent financial collapse actually degraded the value of Quants.

It's a bit unfortunate for you but fortunate for some. The trend seems to be that, the gaps are starting fill between an experienced system trader and a Ph.D. quant.

Kinda like, the merge between Street Smart and Book Smart.

Amaranth falling actually freaked a lot of people with the dangers of having a discretionary trader running large money. Also, simple trading methods that were done by old school experienced traders are being coded and automated, like Trend-following and etc. And of course, everyone's freaked out about Quants for their one-sided model development done for CDOs and how they dealt with the changing markets coming from Lehman and other after-math.

So... the trend right now is a merge between a Street Smart trader who understands Quants. Unfortunately, that's still one sided. They're not looking for a discretionary (like retail prop.) trader who can develop models unless you have a good track record. What they want is a Quant who can trade discretion.

Another side of the story is...

They want the Jack-of-all-trades. Someone who can Develop (Quant skills), Manage (Discretionary Market Insight), and Build (Programming skills) a "professional" automated trading product.

It ain't gonna be easy.

 

[drjmpc]

That is exactly it. These new comments are exactly why I posted the second comment.

Realisticly, you'd love to be able to trade professionaly at a prop house while finishing an Financial Engineering degree with a Math or IT undergrad [Obviously a Software Engineering Undergrade would be ideal or even a Financial Math undergrad with a CS minor]. But this is not necessarily possible for everyone. So what do you do?

You fill in the gaps wherever you can. You get it done. CFA & FRM certification, Incubator Fund or Join the Student Investment Fund at your school, learn and write code for API to conduct your automated trades will all help. Lastly, consider taking as few classes as possible in order to give you time to develop a track record trading and letting the market settle. There is a lot of negative psychology that is governing both the securites market & the corresponding job market to service this industry. Let that settle while you're learning.