My Life as a Quant: Reflections on Physics and Finance

My Life as a Quant

 

My Life as a Quant: Reflections on Physics and Finance
By Emanuel Derman

Emanuel Derman offers the definitive look at applying quantitative physics to the financial field in a personal and accessible manner. His memoir My Life as a Quant, serves as an adventure-filled memoir and an informative view on Wall Street from a physicists’ perspective.

The author, Emanuel Derman, is a premiere voice in the field, being one of the first P.H.D. physicists thrust in the emerging world of applying physics theories to the financial model. Emanuel skillfully brings the reader through the dichotomy of fast-paced financial trading and the high-energy field of particle physics; Derman is undoubtedly a master in both fields, developing models that have become the de facto standard for modern finance.

My Life travels full circle in Derman’s narrative beginning with the divinity of mathematics and their untested application in the financial field, confidently moving through the writer’s own trials and tribulations bringing the reader all the way back to his return to academia with an enlightened knowledge of precision as applied to financial models.

Each chapter in this memoir offers up thorough information for the keen reader.

  • In Chapter 1, Elective Affinities, Derman briefs the reader on his studies at Columbia University and the competitive physics field as he makes a name for himself among the other wunderkind
  • Chapters 2-5 contain information particularly useful for those in academia wishing to further their studies; A Sort of Life displays his personal endeavors in the fields of post-doc research and tumultuous exertion required for publication, while A Sentimental Education finds him reminiscing on the never-ending nature of physics papers and continual research.
  • In Chapter 6 Knowledge of the Higher Worlds, Derman reflects on his new position in the financial world, a stark contrast from his beginnings, as he works to secure his place.
  • Chapters 7-10 illustrate the author in his infancy on Wall Street, In the Penal Colony depicts his beginning software engineering for Bell laboratories, While Transformer shows Derman shifting focuses to financial strategies at Goldman Sachs, Easy Travel to Other Planets Documents he collaboration with Fischer Black on their groundbreaking financial model.
  • Chapters 10-12 document his rise and fall through Wall Street as he recognizes the changes in the volatile market place, ultimately emerging with the realization of flexibility to the inevitable and a highly-adaptable market model.
  • The authors’ aptitude on the subject can be seen in Chapter 15, The Snows of Yesteryear, which depict the changes taking place in the business of Wall Street and its culture as a whole, cementing him as a spearhead in its ever-changing landscape.

Multiple financial and academic outlets have praised the memoir for its unflinching view of  a physicists’ life in the financial market. Reader reviews  have found the book a useful primer on quantitative financial theory, as well as an in-depth look at is draw backs and advantages.

The reviews are in on Derman’s landmark My Life as a Quant, and it’s quantitatively brilliant. If you’re looking to learn more about quantitative finance, what the quant are you waiting for? This book is a must-have.

Reviewed by William Oscar Updyke

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