“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. In My Life as a Quant, Emanuel Derman relives his exciting journey as one of the first high-energy particle physicists to migrate to Wall Street.
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Overall, This book was Emanuel Derman Eman dryly taking us through his life as a theoretical physicist turned quant.
Badlya book contrasting financial models with the theories of hard science, and also containing some autobiographical material. Derman is smart and apparently confident in himself.
Life as a graduate student.
Physics and quantitative finance look deceptively similar. A deep and elegant exploration by a thinker who moved from the hardest of all sciences physics to the softest of the soft finance. Heading the Quantitative Strategies Group. Beginning in Septemberfor one year, Derman wrote a regular column for the Frankfurter Allgemeine Zeitung.
We’re featuring millions of their reader ratings on our book pages to help you find your new favourite book. Derman has to say about that.
After these positions, the relative freedom of Wall Street looked pretty good, and he joined the quantitative side of Goldman Sachs that side being the less prestigious one, relative to the trading side, or salescreating financial models and specializing in interest rate modeling. This involves, inter alia, treating the financial portfolio as a mathematical optimisation problem. There’s an undercurrent mt an unhappy intellectual throughout the book.
My Life as a Quant : Emanuel Derman :
Covers the increasing sophistication of Goldman Sachs and their competitors from the early 80s to aroundincluding some key models in a very light and non-intimidating way. The book is particularly valuable for the insights it provides about the inner workings of a major investment bank, and in particular about the role played by the “quants” in the development of new products and trading strategies.
Thanks for telling us about the problem. Sometimes the story goes very fast and sometimes it drags on an on. Reflections on Physics and Finance by Emanuel Derman. The prologue immediately becomes quite technical, but then the next few chapters are very general and gentle. In the Penal Colony. 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.
His book oife on these ideas with examples from the theories of physics and philosophy, and the models of finance. If you did physics grad school and are interested in emannuel as a hobby or a careerthis is highly recommended. The first man puts on two condoms, one over the other, and then sleeps with the first woman.
In he went to work in the financial industry at Goldman Sachs, staying there untilinterrupted by a one-year stint at Salomon.
He is clearly a brilliant person and I enjoyed his description of how he migrated from an academician in physics to a practitioner in emaunel.
Indeed, I didn’t really understand the nature of what he actually did in finance terribly well. He tells the story of his passage between two worlds; he recounts his adventures with physicists, quants, options traders, and other highfliers on Wall Street; he analyzes the incompatible personas of traders and quants; and he meditates on the dissimilar natures of knowledge in physics and wuant.
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My Life as a Quant: Reflections on Physics and Finance by Emanuel Derman
When the author switches jobs, to move to Goldman Sachs, we have the opportunity to understand rerman the quants, physicists and mathematicians, came to set the trend on Wall Street with the invention of new models for trading complex securities, such as options, swaps and other structured products. That is why Emanuel Derman’s memoirs are socompelling…Derman’s wry humour and sense of irony areapparent throughout the book.
My Life as a Quant: I never thought that I would beinterested in quantitative financial analysis, but reading thisbook has been a fascinating education. Reflections on physics and finance Second ed. In Derman joined Goldman Sachs ‘ fixed income division where he was one of the co-developers of the Black—Derman—Toy interest-rate model. Page by page, Derman details his adventures in this field-analyzing the incompatible personas of traders and quants, and discussing the dissimilar nature of knowledge in physics and finance.
I was happy that he found himself; also I would say that Derman is too modest – not every theoretical physicist would have his facility and intuition for finance. The Snows of Yesteryear.
The Nikkei puts and exotic options. A good life, but Samuelson, MIT, Nobel Laureate in Economic Sciences, “Not only a delightful memoir, but one full of information, bothabout people and their enterprise. lie
He then went on to post-docs at Penn, Oxford and Rockefeller and a tenure track job at Boulder. Heading the Quantitative Strategies Group.
View all 5 comments. In total, Derman spent 16 years at Goldman, with one unhappy year at Salomon Brothers sandwiched in between. Derman had to develop these models, aa this was were the interest for the ex-physicist comes in, it is about quat playing with ideas. Rehired by Goldman Sachsfrom to he led the Quantitative Strategies group in the Equities division, which pioneered the study of local volatility models and the volatility smile.
The book also captures the period of qunt financial engineering b Very interesting book that I would recommend to read to anyone interested in finance as well as individuals interested in transitioning to financial engineering world.