An emerging interdisciplinary field of finance rooted in business, engineering, computer science, and mathematics, financial engineering arose from the “amazing advances in financial theory, computational capacity, new product design, new trading processes, new markets, and new applications” of the past three decades, Tanya Bender and Cara M. Marshall explain in Financial Engineering: The Evolution of a Profession. Financial engineers, they continue, create “think-out-of-the-box, technologically and/or quantitatively sophisticated” solutions that “are the drivers of the new finance.” If that sort of work inspires you, read on!
Heavyweight computer and mathematical skills are the primary tools of the financial engineer, who utilizes this skill set to develop new financial products, manage financial risk, develop investment plans, design portfolios and systems for managing portfolios, and predict foreign exchange movements and develop Forex funds. The financial engineer’s expertise also proves valuable in facilitating automated transactions such as stock trades; the derivatives market is likewise a neat fit. Employers of financial engineers most frequently include investment banks, hedge funds, corporate treasuries, stock brokerages, insurance companies, commercial banks, actuarial firms, and regulatory agencies.
An advanced degree should boost your career in this competitive, highly specialized world. A few schools offer MBAs with a financial engineering concentration, some schools offer a master’s in finance with a financial engineering track, and some offer certificate programs, but the most in-depth option at the master’s level is the Master of Science in Financial Engineering (MSFE), a multidisciplinary degree built on courses drawn from the business, computer science, and mathematics curricula. An MSFE program typically include courses in financial risk management, probability, quantitative methods, stochastic processes, pricing and hedging, derivatives, portfolio theory, and computational methods in finance. MSFE programs are accredited by the International Association of Quantitative Finance (IAQF).
Only a handful of American schools offer this degree online. Online programs allow the convenience and flexibility of asynchronous learning (i.e. students needn’t attend classes at a set time), with the tradeoff of less interpersonal contact and networking with faculty and peers. These are small online programs with very limited enrollment: don’t expect high-end video or any of the other frills associated with larger, more lucrative graduate programs (e.g. online MBAs). What you’ll likely get is as close an approximation of the on-campus program as the school can manage online. We’ve listed the domestic programs below, along with some that originate overseas.
Only three schools in the United States offer the MSFE online. They are:
Stevens Institute of Technology
Stevens Institute of Technology offers its MSFE on campus and online. The curriculum, which focuses on the workings of financial markets, mathematical modeling of markets, Big Data modeling and analysis, and programming in C++, C#, Python, and Java, is identical to the on-campus curriculum. Lectures are delivered by the same faculty who teach on campus, and may be streamed live (a live audio connection allows online students to participate) or viewed later.
Stevens’ online education network, WebCampus, delivers approximately 330 online courses to 2,000 students in 18 master’s degrees and 50 graduate certificates annually. WebCampus’ assistant dean Robert Zotti explains that Stevens is “committed to developing and delivering the best possible online learning experience for our students. We are constantly exploring the potential of new e-learning tools and techniques and are dedicated to pushing the boundaries of what is possible in online learning.” Stevens’ MSFE offers five areas of concentration: algorithmic trading strategies, financial service analytics, financial risk engineering, financial statistics, and financial computing.
University of Southern California
The most prestigious online financial engineering master’s in an admittedly limited field, the USC online MSFE program “addresses problems unique to certain industries,” including derivative securities valuation, risk management, and strategic planning and dynamic investment strategies. The curriculum consists of six required courses (including one directed research project), two electives from the finance, business, and economics area, and two electives covering optimization, simulations, and stochastic systems.
The program is offered through the Viterbi School of Engineering but also involves faculty from the Marshall School of Business and the College of Letters, Arts and Science’s Department of Economics. It is delivered through DEN@Viterbi (Distance Education Network), which offers more than 40 graduate degree programs. DEN@Viterbi provides lectures in live streaming, on demand, and downloadable formats; distance learners may also attend lectures on campus if they wish. Streaming lectures include audio hookups so online students can ask questions as easily as do live attendees. Students communicate with faculty and peers via chat, online meetings, threaded conversation, and telephone.
Founded in 2015, WorldQuant University offers its online Master of Science in Financial Engineering tuition-free. That’s not a typo: WorldQuant students’ only expense is the cost of books (typically $50 to $75 per course per semester). This isn’t a full-out MOOC, though; unlike MOOCs, which are open to everyone, admissions here are competitive. The university was established by hedge fund mogul Igor Tulchinsky in order to “make advanced, quality education accessible to capable students everywhere by leveraging technology at scale to deliver entirely online, tuition-free programs.”
Its nine-course curriculum is delivered one course at a time over seven week terms, followed by a capstone project and a capstone examination; the program takes two years to complete. Unfortunately, the school is currently unaccredited (the school reports that it is in the process of acquiring professional accreditation), and is licensed only in the State of Louisiana. That doesn’t prevent students around the world from attending, but it does impact the way employers will regard a WorldQuant MScFE.
Two schools outside the United States also offer an online MSFE. They are:
National University of Singapore
National University of Singapore’s (NUS) online MSFE is awarded through the school’s Risk Management Institute (RMI), which includes faculty from the university’s departments of finance, mathematics, statistics and applied probability, and economics. Instruction is also provided by practitioners in the finance industry. The curriculum consists of six core courses and four electives and can be completed by distance learners in 18 months to four years. Online students may watch lectures live via WebEx or view recorded lectures later. Exams are administered live at designated areas; they cannot be taken online. NUS’s business school is accredited by AACSB and EQUIS.
University of Leicester
University of Leicester has been delivering online courses for over 25 years, graduating over 36,000 students from distance learning courses in the process. The school uses the Blackboard learning management system and provides online access to library materials; student-faculty and student-peer interaction takes place primarily on discussion boards. Some courses require a 3,000-4,000 page paper instead of a final exam, and the program culminates in a 15,000-word research paper; all in all, this program requires an unusual amount of written work. Exams are administered at designated test centers; they cannot be taken online. The online program takes 24 to 30 months to complete. The business school is accredited by AACSB, AMBA, CABS, and EFMD; the school is a CFA program partner.
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