How much maths is needed?

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Ali_Nili1987

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I believe in this field the more the math skills you have is not always better,there is a certain limit that once you pass will not help you that much,with a computer eng background (I passed calculus 1 & 2 ) how much more maths would be beneficial ?
 
I don’t know how many maths are needed, but I know that Englishes are in high demand.
It’s just like in biologies or medicines, more sciences are always neededs.
 
I just use math, so I guess I just need one.
More seriously, for most fundamental analysis, you need these things:
  • Arithmetic
  • Algebra
  • (A decent B.S. detector, but that’s not mathematical, necessarily)
That’s about it for fundamental analysis, although it also helps if you have an understanding of:
  • Simple Statistics (mean, standard deviations, confidence intervals, basic linear regression)
  • Basic Probability
  • Simple Calculus
If you are doing portfolio construction, then it’s good to add
  • Linear Algebra
  • A deeper understanding of probability
  • Optimization (minimum/maximum) processes
If you are doing macro analysis or attempting forecasting, you are going to want:
  • Econometrics / time series analysis
If you are pricing derivatives you should add
  • Monte Carlo Methods
  • Advanced Probability
  • Stochastic Calculus (though only the applied part is really necessary)
  • Possibly some more advanced stuff like real analysis (behavior of real functions, etc)
The more exotic the derivatives are, the further the mathematics required. But at a certain point, the noise inherrent in human systems overwhelms the ability to use mathematics for rational analysis.
Fixed income tends to be more mathematical than equities, because in fixed income, the future cash flows are better defined, so you can treat them as numbers to do mathematics on. In equities, future cash flows are all estimates, which means they have a lot more noise, and therefore there are fewer calculations you can do with them before the noise just blows up and becomes unmanageable. You end up having a number, but the error bars are so wide as to be meaningless.
And yes, I do understand that “maths” is an abbreviation for “mathematics,” which is plural. ;-)
 
Americans not understand something outside their borders? I’m in total shock!
 
bchad wrote:
And yes, I do understand that “maths” is an abbreviation for “mathematics,” which is plural. ;-)
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I didn’t say explicitly that it’s an abbreviation (or nickname or whatever) for mathematics that is typically British, but yes, it is.
But it always sounds strange to my ears, as “math” must sound to UKers.
 
I think up to econometrics wont be that hard in terms of the mathmatical and statistical knowledge you need and wont be that demanding.But after econometrics it gets pretty tough.Arithmetics,Algebra,Optimazation are not that hard to grasp.But what you mentioned for econometrics and beyond sounds way too hard
 
I don’t think that “math” is preferred by Ukers as the abbreviation for “mathematics”. When I first learnt English, I was told that “maths” was strictly the shortened form for “mathematics” and I have never got any point for putting “math” in subject-verb agreement games. In elementary school, I was taught British English only because in the place where I was born American English was not welcome at that time (or maybe because our teachers also studied British English. English books that we had were mostly from England and Australia… )
 
you should talk to qqqbee, he likes to do maths in his mails to CFAI
 
tjack82b wrote:
Americans not understand something outside their borders? I’m in total shock!
Click to expand...
What really is shocking is that Americans know less about almost any said country than citizens of that country know about America. Almost has shocking as basketball fans being able to identify LeBron James but not the fifteenth guy on the Cav’s roster.
 
I think the idea is that when you are the benchmark to the world on so many fronts (contrary to popular belief with any nonsense rebuttal such as mediocre secondary education system, beginnings of economic weakening, etc., etc.), the world comes to YOU – you don’t need to go to the world.
I’m not saying that’s right, but if you want to understand the fundamental ignorance of Americans, that is the root of it.
At least we are not the French, who are somewhat similar in their snobbish Franco-centricity, but without many of the “world importance” chops to back up the attitude.
 
awkward thing that happened here is that people are running after the guy’s grammar rather than staying on topic.. english is not my first language and im not good at it either, if someone makes a grammatical mistake its not funny to mock him.. I don’t give a DIME about grammar or people making fun of it but I would mess up the grammar intentionally infront of those people who think they are the ultimate linguists.
coming to the topic, yesss a lot of maths skills are needed to understand finance, I was good at it and realized how well it helped me in getting to the bottom of equations, sometimes it would help in understanding, other times I was deriving formulas really quickly and easily from some parts of equations I remembered and usually leading to the right answers.
if you have studied engineering in general, believe me this is nothing when compared to the mess of organic chemistry and non sense laws of physics
 
I used to study computer eng ,Passed Calculus 1,2 and differential equations with flying colors but left it to study accounting,and now I am thinking of studying mathmatics and statistics with accounting,I dont know the result but it sure will be better than accounting alone.
 
Destroyer of Worlds wrote:
I think the idea is that when you are the benchmark to the world on so many fronts (contrary to popular belief with any nonsense rebuttal such as mediocre secondary education system, beginnings of economic weakening, etc., etc.), the world comes to YOU – you don’t need to go to the world.
I’m not saying that’s right, but if you want to understand the fundamental ignorance of Americans, that is the root of it.
At least we are not the French, who are somewhat similar in their snobbish Franco-centricity, but without many of the “world importance” chops to back up the attitude.
Click to expand...
Lol, what is the USA a benchmark for now? Better than most, yeah but certainly nowhere near the benchmark anymore.
Primary Education - Nope
Healthcare - Nope
Safety in society - Nope
Economy - Not anymore
Foreign Policy -Nope
Health Standards - Nope
Culture - Sure if guns and materialism are your thing.
The only case we can probably make is a world class college level education though the costs are insane.
Ignorance s fine, but blabbering garbage with utmost confidence is just being well, american. The fundamental reason is that they’re just fat oafs.
Last time I checked the French were at least tolerated world over. There is a saying “If you’re going to the trenches, the last nationality you pick is american cause he’ll f**k you over for a little bit of money”
 
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