The ever increasing pace of financial transactions has businesses and governmental organizations struggling to hire young professionals with exceptional abilities to understand and apply math, engineering and business skills together in new and exciting ways. The pervasive application of financial modeling to such fields as investment banking, private equity, trading, and portfolio management is making those who master this challenging area very valuable.
Two years ago the College of Business and the College of Engineering worked together to create a new graduate program, the Master of Science in Financial Engineering. “The MSFE was long overdue at ILLINOIS,” said Charlie Kahn, former head of the Department of Finance. Such programs already existed at universities on the east and west coast as well as Carnegie Mellon in Pennsylvania.
Academic leaders like David Ikenberry, who headed the Department of Finance when the program was first developed, Neil Pearson, professor of finance, Jong-Shi Pang, professor of engineering, and Morton Lane, director of the MSFE program, developed a curriculum that married the strengths of engineering with those found in business. “Being late on the scene worked out because we were able to create a program that was weighted very evenly in terms of the two disciplines,” said Pearson.
“We created a program that was stronger than it would have been, had it been situated within only one or separate colleges,” said Ikenberry. “Increasingly we find the skill sets that corporations want don’t line up cleanly with disciplinary divisions found in campus departments. There is a pressing need for blended skillsets and with this program we were able to create stronger students who are more and more appreciated.” Ikenberry is currently the Dean of the Leeds School of Business at the University of Colorado Boulder.
In 2000 a lot of hard work paid off when the MSFE was inaugurated to develop incoming students for the future of the financial industry. 25 students were admitted for the first class and enrollment this fall is 56.
The three-semester program graduated its first class in December 2011 and since then graduates have accepted offers from top companies like Aon Benefit, Securities and Exchange Commission, Ernst & Young Consulting, Morgan Stanley, China Development Bank and others.
“We have about 90% placement by 6 months after graduation,” said Lane. “The program is providing valuable skills for students interested in many areas.”
Paca Nguyen ’11 graduated and went to work for the U.S. Securities and Exchange Commission as a program analyst. Her final group project in the MSFE program involved analyzing transactions and quote data from 9 American options exchanges including the American Stock Exchange, BATS Exchange, Boston Options Exchange, C2 Options Exchange, Chicago Board Options Exchange, International Securities Exchange, NASDAQ Options Exchange, NYSE Archipelago Exchange, and the Philadelphia Stock Exchange. The project was a joint effort between the class and the Boston Options Exchange.
Tiger Wang ’11 now works as a trading assistant at Peak6, Investments, L.P., a financial services firm in Chicago. The option theory he learned while in the MSFE program, “clearly helped me the most. It enables me to think and analyze both in a theoretical and practical way and to incorporate knowledge that keeps me on the cutting edge of the financial services industry,” said Wang.
According to Lane, Chicago provides an attractive focus for a lot of MSFE students. The futures-based culture there favors local entrepreneurially spirited people in ways that are different from the east-coast, institutional-centric culture. Students like Wang are driven individualists intent on making their mark in the exciting world of finance and the ILLINOIS MSFE is helping them to make it.