I applied for a large quant hedge fund out of university (Man Group AHL) with a masters in civil engineering and got to the final round. The other 5 candidates all had MFE degrees and seemed to struggle with the technical interviews a lot more than I did. It seemed like the fund was more interested in my understanding of statistics and general mathematical aptitude than specific knowledge of derivatives pricing etc, the same was true of my interviews at Jane Street.
I would say it's easier to get a job in risk management (likely in investment banking) than quant trading coming out of an MFE degree. This is primarily a consequence of how the MFE programs are set up, what they teach and the network of the professors etc.
So quant funds don't use that much calculus? Primarily statistical techniques?
I would guess that might be the case since pure arbitrage no longer works and thus quant funds have to delve into more probabilistic strategies like stat arb.
The quant derivatives pricing teams at banks are where the stochastic calculus folk tend to head to. Their teams are generally highly respected in this area. Also, banks are doing a different job to funds. Banks are generally interested in assessing the risk or trading risk of these products, either on prop (i.e. with their own funds) or to clients.
Funds tend to concentrate more on statistical/machine learning/econometrics research approaches. The culture is generally more like a research institute thank a bank. They tend to hire more PhDs from Comp Sci, whereas banks will hire directly after MFE or straight out of undergrad.
Is that why physicists (vs computer scientists) are no longer recruited as actively for quant trading roles?
It seems like all the low hanging fruit has been arbitraged away. I've worked with a Math PhD from Princeton before in prop trading and he always lost money.
Machine learning techniques are becoming more common. Hence a shifting trend towards CompSci away from Physicists. The latter were often hired due to their modelling/probability capabilities in PDEs for derivatives pricing.
Also CompSci comes with a (perceived) "built in" ability to carry out good software development practices.
