For this issue from the NUS of the newsletter we asked Mr. Max Wong, who graduated from the NUS Master of Science in Financial Engineering (MFE) Program in 2004, some questions relating to his experience with the MFE, career advice in financial services industry, and more.
Max Wong is a risk professional with 20 years of experience in financial services and author-researcher in the domain of financial risk management and Basel 3 reform. He was an 'open outcry' trader at Simex during the Asian currency crisis (1997) and a quant risk manager during the global credit crisis (2008). He is currently Senior Vice President & Head, Risk Systems and Model Validation at the Singapore Exchange. Max Wong is a subject matter expert in risk modeling and Basel 3 development. He is the author of two books and various journal articles on risks; recently looking at innovative ways to model risk more effectively during crises.
What motivated you to pursue a Master’s Degree in Financial Engineering?
In 2001, a friend suggested that I pursue a master’s degree. As with many things in life, it is just luck that I followed the advice. There is an outdated saying “luck favours the prepared,” but in today’s world, “luck favours the active and bold.” In 2001 financial engineering (FE) was a new field—it is always interesting to enter a new field. Today, FE is offered by many schools and students choose this subject after much thoughtful consideration. Interestingly FE is renewing itself by adding new areas such as Fintech—so maybe luck will still favour the bold today.
How did your experience at RMI’s MFE Program help you with your career?
The syllabus back in 2002 was a lot simpler than todays’ I believe, but even then, the MFE Degree certainly helped with my career, in terms of getting interviews with financial institutions. More importantly for me, it equipped me with the all-round knowledge necessary for self-education, the ability to learn new skills, and apply this knowledge to the marketplace or workplace. This knowledge still proves useful to me in my current role.
Can you share your thoughts on how to best prepare oneself for a career in risk modelling and financial regulation?
There is no better education than self-education. Many of the important topics in risk modeling and financial regulation are beyond the textbook. Fortunately, a lot of information is available these days on the internet and even YouTube podcasts—the resources are unlimited. Therefore, the student needs to approach his education quite differently compared to a decade ago. A fresh graduate who knows say 20% more knowledge beyond a typical MFE syllabus will have significant advantage in today’s competitive job market. Doing internships (even if unpaid and especially if unpaid) will be very useful because there will be a natural inclination to focus on learning from both intern and the supervisor.
Another new area to explore for the student with initiative is fintech. The Singapore government has placed a lot of emphasis and resource in this nascent area. The student that has some general exposure to the topics of fintech will be an asset to financial institutions in the near future.
What are the top five skills that you would look for if you were looking to hire new graduates from the MFE Program?
First, programming skills are essential these days. It is a “must have” for entry-level jobs as a quantitative or financial engineer. Basic languages expected are Visual basic, R, and perhaps Python. For the student with initiative, he should self-learn some basic skills to code API to connect to trading platforms for algorithmic trading. This can prove very useful for a job at a hedge fund, especially with the trend towards computerized trading.
Second, basic derivatives pricing knowledge is important, for example the pricing of bonds, swaps, options, futures, yield curve construction, etc. These topics are part of a typical FE course syllabus, so the employer does not expect to re-educate the candidate on such topics. Third, time series statistics is useful especially in a risk management role because of the use of VaR models, stress test, back testing, etc. Fourth, a general knowledge of how stock, FX, and bond markets work. This can be acquired by regular reading of financial news and exploring the Bloomberg terminals. More creatively, the student can try paper trading, which some (but not many) students explore given the accessibility of trading platforms nowadays.
Lastly, the most important aptitude for a quant – it is an innate sense of curiosity in problem solving. This will differentiate a good quant from the average quant – a new industry trend is to automate certain repetitive quantitative tasks or to move them to low-cost countries. The average quant will risk being replaced by inexpensive robots in the future.
Can you share some highlights of your career and help give some pointers to our current MFE students on career development?
I wrote a few financial books in the middle of my career. There is no greater way to learn about a subject in depth than to write a book about it. Such an undertaking requires a lot of time commitment so it is best to do such projects before you turn 40. However, a book project will reinvent you and fast-track your career.
The second way to really propel your career is to have a successful mentor, who will be able to point out to you “where the money is”, or the areas of greatest opportunity – such opportunities obviously changes overtime sometime within years. Therefore, to be connected to experienced mentors who have navigated the marketplace is truly useful. I wished I knew this when I was younger.
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