What background do you need for risk management?

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fkcfa

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Does CFA help? Or do they like people with math/statistics background better?
I’ve been in the back office for 3 years and would like a switch/move up in my career…
Any advise will be appreciated.
 
“Risk Management” is a very broad term but generally, either of those should be helpful.
 
You are more interested in my ID than what I asked…
CFAvsMBA Wrote:
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> Word, Fk CFA!
 
fkcfa Wrote:
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> Does CFA help? Or do they like people with
> math/statistics background better?
Probably pointing out the obvious here, but if you’re really interested in a career in Financial Risk Management, the “Financial Risk Manager” (FRM) designation seems like the natural fit.
And the AnalystForum FRM forums may be a better place to ask your question.
 
Yeah, CFA can help, but not nearly as much as good quant skills and credentials that unmistakably say that.
 
Are you looking to move to risk management in a specific industry? I transitioned from examining banks at the federal government into risk advisory at a Big 4, those may be opportunities you might want to consider.
 
In current scenario, risk management is not about quant, in fact risk management was never about quant, a purely quantitative approach to risk management will be antithesis of risk management.
Risk management is not a science, it’s engineering, it is an art in itself which combines knowledge of mathematics, finance and technology, all three are equally important. Moreover it’s a job where you have to deal with a lot of people from different teams, it’s an exciting job if you like all that. But that’s when you can call yourself “risk manager”, for first couple of years your job can be not so exciting as you’ll be primarily involved in checking risk numbers, shooting mails here and there, and escalating IT teams and developers.
CFA definitely helps but the scope is limited to glittering your Resume and getting you interviews, though FRM will be more helpful in work as most of the time you’ll be dealing with derivatives.
In any case, an engineering undergrad + MBA > engineering undergrad + CFA > MBA > CFA in risk management.
 
I’m currently working at the back office of a buy-side firm. I’m thinking about to move to risk management at buy-side….
bpdulog Wrote:
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> Are you looking to move to risk management in a
> specific industry? I transitioned from examining
> banks at the federal government into risk advisory
> at a Big 4, those may be opportunities you might
> want to consider.
 
Thank you for the information. I’m really interested in this field and trying to figure out how to get there.
I have a master’s in Finance and 3 years of exp in the back office of a buy-side firm. No engineering background. Plan to take CFA level II next June.
Someone adivsed me to finish CFA before FRM. Or shall I get a 2nd degree in quant?
Any thoughts?
BangBusDriver Wrote:
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> In current scenario, risk management is not about
> quant, in fact risk management was never about
> quant, a purely quantitative approach to risk
> management will be antithesis of risk management.
>
>
> Risk management is not a science, it’s
> engineering, it is an art in itself which combines
> knowledge of mathematics, finance and technology,
> all three are equally important. Moreover it’s a
> job where you have to deal with a lot of people
> from different teams, it’s an exciting job if you
> like all that. But that’s when you can call
> yourself “risk manager”, for first couple of years
> your job can be not so exciting as you’ll be
> primarily involved in checking risk numbers,
> shooting mails here and there, and escalating IT
> teams and developers.
>
> CFA definitely helps but the scope is limited to
> glittering your Resume and getting you interviews,
> though FRM will be more helpful in work as most of
> the time you’ll be dealing with derivatives.
>
> In any case, an engineering undergrad + MBA >
> engineering undergrad + CFA > MBA > CFA in risk
> management.
 
I spent some time in corporate risk before but not the hardcore stuff. what is most important on a junior level is computer skills (programming, vba, etc.). CFA is not at all important. Most were pursuing CFA but it was not a prereq to get in. I believe they had math or engineering backgrounds.
 
fkcfa Wrote:
——————————————————-
> Or
> shall I get a 2nd degree in quant?
> Any thoughts?
>
MFE
 
BangBusDriver Wrote:
——————————————————-
> In current scenario, risk management is not about
> quant, in fact risk management was never about
> quant, a purely quantitative approach to risk
> management will be antithesis of risk management.
Huh. Obviously there are different disciplines of risk management. This discussion is seemingly focusing on market risk management, which has a substantial focus on quantitative methods. Obviously, even when focusing on market risk management, other tools besides quantitative ones could be used. Few would advocate only quantitative ones, but you could probably do that and do just as well.
> In any case, an engineering undergrad + MBA >
> engineering undergrad + CFA > MBA > CFA in risk
> management.
CFA in risk management?
 
fkcfa Wrote:
——————————————————-
> Thank you for the information. I’m really
> interested in this field and trying to figure out
> how to get there.
Why not find a handful job postings for the kind of risk management work you’d like to do.
And then see what kind of qualifications they’re asking for.
Here’s an example of an investment risk posting that’s not atypical…
http://mutualfundcareers.com/mfc/asp/job_detail.asp?id=9112
 
I’ve heard people say that risk reporting is a way to move into the risk management space. I am not too familiar with the role itself but it seems like VaR analysis, risk based PnL moves for derivs, etc.
Someone mentioned that engineering undergrad + mba/cfa is a good way to go. i have an electrical engr undergrad + L3 candidate and have no such luck yet. seems like M.Fin would be better. but i could also be looking at the wrong places.
 
2 votes for actuarial. ‘Course, the exam progression is longer and tougher than CFA exams; it’s certainly not the most direct route into risk management.
 
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