Business Finance

What Is a Quantitative Finance Analyst?

Editor

A quantitative analyst is someone who analyses data using mathematical models and algorithms and then relays the information in the form of reports to the various company departments that need them. The simple job description of an analyst in quantitative finance is that they use data and statistics to try and make conclusions of what could happen to financial markets and industries in the future.

Quant analysts apply a combination of skills, techniques, and experience from a wide variety of subjects, such as mathematics, computer programming and coding, accounting, and trading.

What Makes a Quant Finance Analyst Different from a Regular Finance Analyst?

Often, business analysts often have experience with mathematics, however their main subject of education at degree-level is usually business-related such as business studies, marketing, or finance; these are the traditional subjects that are held in high esteem for those wanting to start their own business or those wanting to hold leadership positions in business.

However, some students are more focused on the numbers and data involved in business, and so study degrees such as mathematics, economics, and computer programming. These are the students that go into quant finance roles.

Instead of focusing on relationships, employee management, and negotiating, they instead focus on statistics, data, and computer programs to analyse the financial landscape and to try and make good business descriptions based off their findings.

What Kind of Businesses Hire Quants?

There are a wide variety of industries that employ quantitative finance analysts, from investment firms to government agencies, to law firms. Despite the variety in the companies that hire, most quant analysts have essentially the same job, they analyse statistics and data to predict financial markets in the future.

Quantitative finance started becoming popular way back in the 1980s, around the time that companies started keeping and using data and businesses started using computers on a wide scale. During this time, the majority of quants were working with Wall Street. Because of this, a lot of people assume quantitative analysts are only employed to deal with stocks and investments, however, they are put to use in a multitude of different industries.

Nowadays they are employed to judge all different kinds of investments that companies make, from which assets banks should purchase, to which kind of produce grocers should purchase. As the majority of goods trading is now computerised, quants are valuable in any business.

Here’s a small list of businesses that hire quants:

  • -Hedge funds
  • -Investment firms
  • -Law firms
  • -Stock traders
  • -Government agencies
  • -Wealth management firms
  • -Banks
  • -Software companies
  • -And many, many more.

To become a quantitative analyst, a person must be highly qualified in multiple fields, as well as having experience in a workplace in statistics, computer science, or finance. Because of the skills and experience needed to take on a quant finance role, the salaries on offer can be extremely lucrative. If you have a passion for finance and mathematics, this could be the perfect role for you.