11 quotes from My Life as a Quant: Reflections on Physics and Finance: ‘If you decide you don’t have to get A’s, you can learn an enormous amount in coll. “Derman’s memoir of his transition from mathematical physicistto expert finance whiz at Goldman Sachs and Salomon Brothers readslike a novel, but tells a lot. Last week I was in a bookstore and ran across a new book by Emanuel Derman called My Life as a Quant: Reflections on Physics and Finance.

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Qkant is the author of numerous articles in elementary particle physics, computer science, and finance, and a coauthor of the widely used Black-Derman-Toy interest rate model and the Derman-Kani local volatility model. So the one who controls the dollar, controls the reality?

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There he made significant contributions to the mathematics of derivatives pricing, building on the Black-Scholes model which has been called the only real achievement of economics theory. It was impossible to resist the temptation to generalize to N couples.

Amazon Music Stream millions of songs. The calculations showed that this was not a concern. Thank you for your feedback. My Life as a Quant Quotes Showing of Want to Read Currently Reading Read. Financial engineering becomes a real field.

But what the heck is a swaption? The complex technical details are well written to give me a rough idea. He moved on to a higher paying but creatively stifling ass job at Bell Lifee where, though you had a doctorate, your supervisor might only have a masters degreewhere he often felt subservient and demeaned.

The most interesting part to me was the fact that his most interesting contributions came way after he finished his PhD. The first third, the story of his life as a grad student and post-doc, was highly amusing. Wiley; 1 edition April 21, Publication Date: Quite llfe book especially for someone with financial background using the models or considering going into the field straight out of university.


Nowadays, the fortunes offirms and the stability of markets often rest on mathematicalmodels. This biography is special in that he tells his life story, but also explains the models he worked on in simple, clear prose. From this you can generate uncertainty or was it risk and allow you to hedge your bets against changes in the price of that asset.

How can they manage four couplings with only two condoms? Algorithmic and high-frequency trading – where buy and sell decisions are made by computer programs in milliseconds – are now a real concern. I guess dermah gist is that in finance you want to know qunat fair price for something.

I could totally relate to the author when he talks about getting a Physics PhD in Columbia or studying options and futures on his own to get to Wall Street. Derman was charged with developing the famous Black-Scholes optionpricing model so it could be applied to bonds, an urgent task dermqn more volatile markets of the post oil shock world.

The most challenging part of the book — and for techies, probably the best — is Derman’s detailed explanation of trading tools he developed. Throughout this tale, he also reflects on the appropriate way to apply the refined methods of physics to the hurly-burly world of markets. The Volatility Smile Wiley Finance. It quotes Schopenhauer and Goethe while supplying not one but three diagrams of a muon neutrino colliding with a proton.


My Life as a Quant

He was merely very smart in a field dominated by geniuses, so he kicked around from one low-paying research job to another. The author does liife dress up the important decisions he made: Jan 25, John rated it liked dermqn.

We need to go back to investing money the old fashioned way: How I Became a Quant: Derman conveys some of the excitement of the ‘s as the standard model emerged and looked for verification; a heady time.

Although he was undoubtedly well paid for the skills he brought to the financial markets, Derman’s story is tinged with sadness about the loss of an ideal. He is best known as a quantitative analyst, and author of the book My Life as a Quant: A memoir describing Derman’s career. A very honest and balanced account of life in academia and industry that doesn’t glorify or damn either of them.

My Life as a Quant Quotes by Emanuel Derman

It also allows you to generate financial products to sell ljfe what price to sell them at hence financial engineeringand then how much risk you yourself have holding them. Blackhe knows first hand what he’s talking about. He does not portray himself as a genius, yet he makes you admire his thirst for progress. There is a long sectionon the brilliant and punctilious Fischer Black; a glimpse ofphysicist Richard Feynman; and an embarrassing encounter withfinance giant Robert Merton, who sat next to the author lice a longflight Derman treated him rudely before realizing who hewas.

This involves, inter alia, treating the financial portfolio as a mathematical optimisation problem.