Student Resources / What Is Financial Engineering

What Is Financial Engineering?

  • Financial engineering is the application of mathematical methods to the solution of problems in finance.
  • It is also known as financial mathematics, mathematical finance, and computational finance.
  • Financial engineering draws on tools from applied mathematics, computer science, statistics, and economic theory.
  • Investment banks, commercial banks, hedge funds, Fintech companies, insurance companies, corporate treasuries, and regulatory agencies employ financial engineers.
  • These businesses apply the methods of financial engineering to such problems as new product development, derivative securities valuation, portfolio structuring, risk management, and scenario simulation.
  • Financial Engineers, having built a very strong foundation of skills, are also able to succeed in Data Science, ML/AI and Developer roles. 
  • Quantitative analysis has brought innovation, efficiency and rigor to financial markets and to the investment process.
  • As the pace of financial innovation accelerates, the need for highly qualified people with specific training in financial engineering continues to grow in all market environments.

© Copyright 2020 International Association for Quantitative Finance