In the interest of having "canonical questions" on this site ... What is a Quant?
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asked Feb 9, 2011 at 12:12
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2$\begingroup$ Should we put this as a community wiki? $\endgroup$– GravitonCommented Feb 9, 2011 at 12:15
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1$\begingroup$ I don't necessarily see this as a community wiki. Someone should be able to come along and give a complete definition that is acceptable to everyone. $\endgroup$– ShaneCommented Feb 9, 2011 at 14:20
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$\begingroup$ I'm sorry, my attempts to approve your edit of my answer were blocked by the software. (It seems that your edit had interfered somehow with a previous edit of my own). I will try to approve it if you suggest it once more. Thanks. $\endgroup$– olakerCommented Feb 9, 2011 at 18:17
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3 Answers
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Mark Joshi briefly describes the roles of six types of quants in his advice for wannabe quants:
- Front office or desk quant
- Model validating quant
- Research quant
- Quant developer
- Statistical arbitrage quant
- Capital quant
His classification agrees more or less with the taxonomy contained in the Wikipedia article.
"For the past twenty years, throughout Wall Street and the City of London, in most major and many minor financial institutions, small groups of ex-physicists and applied mathematicians have tried to apply their skills to securities markets. Formerly called “rocket scientists” by those who mistakenly thought that rocketry was the most advanced branch of science, they are now commonly called “quants.” (Emanuel Derman, My Life as a Quant).
"A quant is a brand of industrial scientist who applies mathematical models of uncertainty to financial (or socioeconomic) data and complex financial instruments." (Nassim Taleb, The Black Swan).
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17$\begingroup$ 75% of the time, a quant is a well-paid programmer. $\endgroup$ Commented Feb 9, 2011 at 19:33
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A Quant is someone who develops mathematical models for financial markets.
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$\begingroup$ I have kept my definition intentionally broad, but this covers many different kinds of careers ranging from structure products, derivatives valuations (and financial engineering), to algorithmic trading. The key common point is that people are providing models for financial markets that are based on mathematics. $\endgroup$– ShaneCommented Feb 9, 2011 at 15:19
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2$\begingroup$ I would change "develops" to "develops, implements, tests and maintains". Otherwise, I think it's the best definition. Short and to the point. $\endgroup$ Commented Feb 9, 2011 at 19:34
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Generally speaking, a Quant is just another fancy word for "financial engineer".
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4$\begingroup$ And what's a financial engineer? $\endgroup$ Commented Feb 9, 2011 at 14:44
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$\begingroup$ Well usually people know what an engineer is, and have a somewhat obscure idea of what finance is about. But "Quant" is a relatively recent term, this explains the form of my answer. Now if you want to know what exactly a financial engineer is doing, this is a different matter in my opinion because there are a really wide variety of mission that a quant can deal with in a single company. Regards $\endgroup$ Commented Feb 9, 2011 at 15:28
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$\begingroup$ I think this is explaining a vague term by an even more vague term. Is a structurer a financial engineer too? what about the quant traders? $\endgroup$ Commented Feb 9, 2011 at 19:33
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$\begingroup$ @ quant_dev : I would say a structurer need some basic financial engineering skills but need not be a financial enginieer himself (usually he has a quant support team at disposal). And a "Quant Trader" is definitely a financial engineer. Regards $\endgroup$ Commented Feb 10, 2011 at 7:48