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Studying to become a quant involves lots of maths and lots of theoretical models. Sometimes I feel like I have zero intuition regarding the things I am studying and how/when/why they may be applied in practice

What are some good books to read to get that intuition? I have no particular topic in mind, anything which is relevant in modern finance could be interesting.

I'm not looking for books that just teach the basics but "without the math". To me, that's not intuition, that's just more readable. I am looking for books that assume I know the math, and explain to me how the "real world" works.

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  • $\begingroup$ This is not an answer to your question, so posting as a comment. While there's nothing wrong with learning about finance in general, I wouldn't recommend to prioritize it in order to get a quant job. No one will hire you, because you read several good books about finance. Prioritize math, stats, coding, and if you're good at those you'll get a job and will learn all the relevant finance stuff at your workplace. It's really not that complicated. $\endgroup$
    – LazyCat
    May 1, 2018 at 16:49
  • $\begingroup$ This also is not an answer, but there were 2 good books written about the hedge fund LTCM 'Inventing Money' and 'When Genius Failed' that gave me a good introduction to what these quants were doing and what went wrong and put them out of business. There are also many good books about the events of 2008 that give an inside look at what was happening inside big financial institutions. Another suggestion might be to just read a financial newspaper once in a while for a flavor of what is going on now, what people are doing. $\endgroup$
    – Alex C
    May 1, 2018 at 19:53

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Finance is a big field. If you have anything specific in mind (corporate finance, asset pricing, risk management) I can give you some more specific references.

Some references for basic finance:

  1. Investments and Portfolio Management (Bodie, Kanie and Marcus)
  2. Modern Portfolio Theory and Investment Analysis (Elton, Gruber, Brown, Goetzmann)
  3. Fundamentals of Corporate Finance, (Berk, DeMarzo, Harford)

Some intermediate references (mainly econometrics but a lot of intuition on asset prices properties):

  1. Introductory Econometrics for Finance (Brooks), Cambridge University Press, 2nd edition (BRO)
  2. The Econometrics of Financial Markets (Campbell, Lo, Mackinglay)
  3. Asset Pricing and Portfolio Choice Theory (Back)
  4. An Introduction to Financial Option Valuation: Mathematics, Stochastics and Computation (this is one of my personal favorites)

Some advanced references:

  1. Asset Pricing (Cochrane)
  2. Financial Decisions and Markets (Campbell)
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    $\begingroup$ If he wants to be a quant, the choice of Cochrane and Campbell is almost useless in the sense that, especially the second, are great books for academics, but with very little use for practitioners. Kerry Back's "Asset Pricing and Portfolio Choice" is maybe more useful $\endgroup$
    – fni
    May 2, 2018 at 8:40
  • $\begingroup$ I missed the quant part. I agree with Kerry Back's reference. I have edited my answer and added a couple of references (including Backs') $\endgroup$
    – phdstudent
    May 2, 2018 at 9:04
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    $\begingroup$ @phdstudent What about the Carol Alexander´s books (Quantitative Methods in Finance)? I found them pretty useful too for begginer, but i would like to know your opinion. $\endgroup$
    – Newbie
    May 2, 2018 at 15:49
  • $\begingroup$ @newbie never worked with it. So no opinion. But I will add it the list. $\endgroup$
    – phdstudent
    May 2, 2018 at 15:50
  • $\begingroup$ Hamilton's TSA for adv econometrics $\endgroup$
    – rrg
    May 25, 2018 at 15:36
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The Greeks and Hedging explained by Peter Leoni is trying to bridge the gap between theory and practice. As the title indicates, it focuses on how traders hedge their books with the tools available, mainly the Black-Scholes model. It is light on math, strong on intuition building.

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