10 Reasons to Bank on a Financial Engineering Career

by Darwin on August 12, 2010

You can’t stay with the head fakes that you’re seeing from management in the financial sector; don’t even try.  They’re still recovering from a massive high colonic delivered by the collapse of the derivatives market – vaporware with remarkable destructive powers.  But the federal government kept the trading apparatus intact, and investment is as important to the GNP these days as Chevrolets used to be.  So the beat goes on, the newly graduated MBAs are still washing up on Wall Street like a tidal surge up the East River and the opportunities for ambitious business-oriented young brains are still there.  But the machinery within the financial services sector keeps evolving, as evidenced by the arrival of the Master’s in Financial Engineering Degree.  Here’s why that’s true.  Here also are a few reasons why a Master’s Degree in this field might be a better option than an MBA.

  1. Building the saleable beast: Derivatives haven’t gone away.  One of the talents most in demand today among investment houses is the ability to create new financial instruments for sale to individual investors and for trading purposes among the institutions that live off of swapping these complex products.  A graduate in financial engineering has been trained to construct new products for these markets.
  2. Excellence in Analytics: A financial engineering degree is a very descriptive sheepskin.  Students in these programs learn the math behind financial structuring – for products and for markets.  Someone who has the mathematical sophistication to analyze the risk inherent in a complex investment is a valuable personnel asset in an investment house.
  3. Data Mastery:  It’s one thing to understand database structure and management; it’s another to have the skills to put data to work.  The curriculum in a financial engineering degree program will dig into the applications programming required for harnessing data as an analytics tool and beyond that, as a predictive benchmark.
  4. Risk Management: This concept seems to have become a watchword in the investment sector, a newly reintroduced value.  Financial engineers are trained to inspect every investment proposition with the inclusion of a risk analysis based on a complex set of data points gleaned from the nature of the deal and the history of the market.
  5. Finance Theory: There’s a lot of territory covered in this field with an MBA program; there is as much or more incorporated into financial engineering because there has to be theory underlying those analytic conclusions.  Financial engineering locks in on the necessary building blocks for a career in quantitative analysis.
  6. A Quick Route to an Important Job: With the right undergraduate degree (math, engineering, computer science, statistics) a student can complete a Master’s in Financial Engineering in one year.  It doesn’t carry the panache of an MBA and probably won’t give you a network of professional allies, but it will get you in the door for an interview easily.
  7. Less Apprenticeship Necessary: In the top tier investment houses, entry level MBAs go through a necessary period of training before they are managing accounts and clients.  A financial engineering degree is going to have some entry level baby steps as well, but the nature of mathematical design and analytics is such that training trumps experience when it is data, not personal experience driving the decision making.
  8. Quantitative Professionals: Some people in the financial sector see quantitative analysis as the back room drudgery necessary for preparing the goods and services delivered by the traders and consultants that complete transactions.  Others see “quants” as the people that are increasingly defining not only the products but the functionality of business analysis in general.
  9. Cost versus Career: There is some validity to the argument that an MBA provides management training not to be found in a financial engineering program.  But there is also validity to the case that an experienced quantitative analyst can find a management role today, and that these complex mathematical professional skills will increasingly be management tools as well.  And you’re likely to graduate from a financial engineering program with thirty to fifty thousand dollars less debt from the cost of your education.
  10. The Evolving Degree: Financial engineering is a young specialty in a very old profession.  It quickly became an important profession as trading has rapidly become an automated function, and the financial instruments being traded have little to do with goods or services.  Finance engineering degree curricula are growing in scope today, preparing graduates for expanded roles within investment corporations.  Some programs have gone to three semesters.  It’s a cutting edge degree that is growing academically as the profession expands in the marketplace.


Bob Hartzell has been writing on the morphing higher education scene for four years.  He has tracked the growth of online education since its beginning as a primitive tool for small continuing education programs.   Today every year brings dozens of traditional universities into online education, continuing education, blended teaching formats and new options for returning students.  You can find his articles and information from many other sources on the rich variety of educational options for career enhancement at Online Masters Degree Guide.

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