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3 Reasons Why Quantitative Analysis Is A Good Fit For PhDs

Written by: Aditya Sharma, Ph.D.

I knew I needed to leave academia.

The situation in my lab was getting worse every day.

The lack of academic funding was taking its toll on everyone, and we were all stressed out.

My advisor was constantly telling me that I didn’t know anything.

I would get in trouble for using initiative, told only to do as I was instructed.

Original ideas were not encouraged.

Meanwhile, I was expected to complete extra work that wasn’t getting done by a student in our lab.

I didn’t get any appreciation or acknowledgement for the extra work I was doing.

I worked long hours and the negativity of the lab was making me depressed.

But mostly, I lacked the support and guidance that I needed.

There was no clear way to move forward in my career. I felt stuck, berated by my advisor, and overwhelmed by the extra work I completed without any extra compensation.

I was stressed and overworked.

I reached a breaking point and made the decision to transition into industry.

At first, the relief of knowing I was going to leave academia was wonderful.

But then, I got nervous.

What would I do outside academia?

Would I be able to get a job that wasn’t at a university?

I was worried that maybe I had made the wrong decision.

But, the more research I did, the more I realized that my PhD had given me invaluable skills.

As a PhD, I had many industry-desired skills that gave me an advantage over other job candidates.

I just had to figure out which industry position was the right one for me.

I realized that my knowledge of advanced statistics was a skill that set me apart from other candidates.

As I researched the alternative careers available to PhDs, I was drawn to the analyst positions.

Since I had experience working with large data sets, the analyst positions seemed perfect for me.

I knew I was on the right track to leave academia.

I worked on building up my professional network, and soon recruiters started contacting me.

I was finally getting noticed and the future looked great.

Why Quantitative Analysis Is A Great Option For PhDs

Since the global economic crisis, the need for financial security has increased, and with it the demand for quantitative analysts has increased, as reported in Forbes.

According to the Bureau of Labor Statistics, employment in the financial analysis field alone is expected to grow by 12% over 10 years.

This growth rate is larger than the average for all other occupations.

The collapse of the world banking system exposed the need to develop better risk management strategies.

It also highlighted the need to identify profitable investment opportunities, calculate investment risks, and reduce these risks.

These are the goals of a quantitative analyst.

Over the last few years, there has also been a rise in the number of hedge funds, one of the major employers of quantitative analysts.

Hedge funds’ profits depend largely on how successfully they can maintain consistently high returns on the assets under their management.

Companies have come to rely on excellent quantitative analysts.

In most cases, even entry-level positions require candidates to have a masters degree or PhD.

Because of this need, and the specific skill set and qualifications required, quantitative analyst positions also come with a high salary.

According to Payscale, at the entry level, quantitative analysts can expect to earn an average of $77,000 per year and up to approximately $114,000 for large cities.

And this is just for entry-level positions.

With experience, earning more than $500,000 per year is achievable.

While there is high demand for quantitative analysts, the skill level required for these positions is also high.

Having a PhD alone will not guarantee you a career as a quantitative analyst. You will need to know how to leverage your other skills as well.

In order to be fully competitive, you will need to demonstrate that you have additional, transferable skills.

You should demonstrate that you can think independently and outside the box.

Also, highlight your ability to learn new skills quickly and be able to adapt to complex and ever-changing market environments.

As a PhD, you have what it takes to get the industry position you want.

Now, you just have to decide what position is the right one for you.

3 Ways To Know If Quantitative Analyst Is The Right Industry Position For You

There are a lot of good career options for PhDs.

A lesser known, but excellent career choice for PhDs is quantitative analysis.

Quantitative analyst positions are in high-demand.

They are a great option to take the high level skills you gained as a PhD, and apply them in the business and financial realm.

Here are 3 ways to know if you should consider transitioning into a quantitative analyst position…

1. You are a dataset guru.

Data mining and database management skills are highly sought after for quantitative analyst positions.

Quantitative analysts predict financial behavior through researching and analysing market trends.

This involves the development and implementation of complex mathematical models from raw data.

Companies use quantitative analysis to reduce the risks that accompany their business decisions, especially in today’s extremely volatile market environment.

The main role of quantitative analysts is to take raw data, which can be sales revenues, derivative pricing models, or customer satisfaction, and transform it into minimum risk investment opportunities.

As a PhD, you have lots of experience transforming raw data into useful information.

Additionally, government-employed quantitative analysts are involved in the analysis that shapes monetary and economic policies.

They may be involved in developing and predicting changes in Gross Domestic Profit (GDP) figures, or other government statistics.

While quantitative analyst positions come with some pressure, as you are responsible for financial risk calculations etc., it offers the opportunity to influence key decisions.

Plus, as PhDs, we like tough problems, and quantitative analyst positions provide the personal satisfaction that comes with solving complex problems.

2. You have strong math and statistics skill sets.

Being able to think scientifically is an essential requirement to work as a quantitative analyst.

Quantitative analyst, Micah Spruill reports that the best analysts usually have a background in math, computer science, engineering, or a related natural science field.

In other words, STEM PhDs are uniquely suited for quantitative analyst positions.

PhDs in the STEM subjects often have a sound knowledge of statistics and excellent mathematical abilities.

As a quantitative analyst, you would need to take your stats and maths skills and apply them to financial risk management.

Thus, if you have a good understanding of econometrics and financial analysis, this will help you get a role as a quantitative analyst.

It is essential for you to demonstrate your business acumen and knowledge of industry trends when applying for analyst positions.

Specific skills employers are looking for are: a knowledge of finance and statistics, calculus and game theory, financial modeling, and strong analytical skills.

Programming skills using Python, C + +, MatLab, and Excel will also help you get hired.

With regards to transferable skills, you will need to have excellent communication skills and the ability to work under pressure.

Quantitative analyst positions require a very high-level skill set.

If you feel you are lacking in some areas, additional training could be a good option.

But remember, you can get a job without meeting all the requirements.

The best way to get the industry position you want is to network.

Networking and getting job referrals will allow you to get the industry position you want, even if you are missing a few of the job requirements.

Plus, PhDs are masters of learning. You are capable of learning any new skills you need once you are on the job.

3. You are excited to transfer your PhD skills into a finance setting.

Qualitative analysts are in high demand and, according to Investopedia, these positions span the fields of economics, business, and finance.

As such, there are no shortages of companies looking to hire quantitative analysts.

If you want to become a quantitative analyst, you should start networking with relevant companies.

Companies that often hire quantitative analysts are hedge funds, investment banks, commercial banks, and private equity firms.

Large banks such as Citigroup, JPMorgan Chase, Goldman Sachs, and Credit Suisse are major employers of quantitative analysts.

Accounting and insurance companies are also great places to look for quantitative analysis roles.

There is no shortage of insurance and accounting companies, which can range from small to large companies.

You can also target consulting firms and government organizations.

Quantitative analyst roles in consulting firms and government are still likely to centre around some form of economic or financial department, so look for positions in the departments of economics or statistics.

Overall, it is the financial industry that hires quantitative analysts, so you need to have a passion for this area if you are going to pursue an analyst role.

There is a wide range of industry positions that are great options for PhDs. One lesser known, but quite lucrative, position is that of a quantitative analyst. These positions are in high demand and PhDs have many of the skills needed for this role. PhDs who are experts with data sets and data mining, who have strong mathematical and statistical backgrounds, and who have an interest in finance, are well-suited for a role as a quantitative analyst. PhDs who can work under pressure and who have excellent communication skills will be able to succeed in quantitative analysis roles. With a wide range of potential employers and an increasing demand, quantitative analysis roles are an excellent career choice for PhDs.

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Aditya Sharma, Ph.D.

Aditya Sharma, Ph.D.

Aditya has a PhD in Physics from the University of Toronto, Canada and a passion for Nanotechnology. His PhD project focused on 3D magnetic nanostructures and he is now combining this passion with his keen business acumen and works as a scientific consultant at a top Canadian consulting firm.
Aditya Sharma, Ph.D.