Financial Engineering

I heard this term Financial engineering i shocked i dont wat is this about and I compare it with CFA. Confused wat to do is this relevant for our career go for MSFE or just focus on CFA.

do some homework. It’s easy to find, then ask questions

Depends on what you want to do and also on your background. No offense, but unless you have very good background in maths & programming, you wouldn’t even qualify for admission in many MFE programs.


Think of it as something most people enrolled in CFA program aren’t capable of doing.

Financial engineering is about creating portfolios that mimic a wide variety of payoff streams and figuring out how to price them. It’s used a lot in derivatives and structured products and to help banks and other organizations with active balance sheets deliver a requested payoff to clients without having to take anything more than counterparty risk, or for asset managers to take very specific kinds of risk and hedge out other risks that they don’t want to take.

Lots of math and programming skills required there: linear algebra, stochastic calculus, statistics/econometrics, monte carlo simulations, etc… Not all applications require all of these skills, but people expect financial engineers to be minimally competent in each of them.