Financial engineering courses are typically offered as part of a master’s degree program for students interested in a career in finance. The prerequisite for entry into a program is often a bachelor’s degree in a discipline that involves high level mathematics, such as physics, computer science, economics or engineering. Financial engineering programs at the master’s level typically last one year, and successful candidates can often pursue a doctoral degree after completion. A financial engineer can seek a career track in stock trading, derivatives analysis or financial risk management. They can also work as quantitative analysts in corporations of financial firms.
The topics of derivatives, financial management and high level financial mathematical theories are typically covered in financial engineering courses. Derivatives coursework usually entails the study of pricing and hedging derivatives, foreign currencies, commodities and interest rate derivatives. Financial management coursework often teaches the student about decision making processes within corporations, liquidity and volatility issues, and dividends. Financial mathematics coursework often includes statistics and probability, financial theorems, stochastic differential equations and the replication of trading strategies. Calculus, probability and computer programming in a high level language are often prerequisites for financial engineering classes, in addition to economics and accounting.
Financial engineering courses often become more specialized in the second half of a master’s degree program. Classes can include advanced derivatives, fixed income markets, time series analysis and legal issues within the field of financial engineering. The study of fixed income markets can include bond pricing, credit risks and different methods of valuation. Time series analysis is the study of various economic models to make market predictions. The study of legal aspects within financial engineering is often important, due to changing regulations and compliance issues within derivatives, risk oversight and disclosure laws.
In order to complete financial engineering courses for a master’s degree, students are often required to complete a work study, internship or on-site project. These typically last several weeks, and can be completed as part of a group or individually by the student. The focus of the internship or project is usually on applying mathematical concepts within the financial realm, and students are often placed within top financial firms for these projects. The final course for students is often a master’s degree project related to financial engineering. The student will often be required to demonstrate their mastery of the financial tools and models they’ve studied during the course of the master’s program.