Financial engineering
Financial engineering is the process of employing mathematical finance and computer modeling skills to make pricing, hedging, trading and portfolio management decisions. Utilizing various derivative securities and other methods, financial engineering aims to precisely control the financial risk that an entity takes on. Methods can be employed to take on unlimited risks under certain events, or completely eliminate other risks by utilizing combinations of derivative and other securities.
Areas where financial engineering techniques are employed include:
- Investment banking
- Corporate strategic planning
- Risk management
- Primary and derivative securities valuation
- Swaps & derivatives trading or dealing
- Financial information systems management
- Portfolio management
- Securities trading
Some big contributors to financial engineering:
This is a field of knowledge that is drawing the attention of actuarial science graduates or computer science graduates with a good mathematical background.