Bayes marks Quantitative Finance landmark by looking at future risks

Bayes marked the 20th anniversary of its MSc in Quantitative Finance by holding a panel discussion on emerging risks to the sector.

Alumni, academics, students and practitioners marked the 20th anniversary of Bayes Business School’s MSc in Quantitative Finance with a panel session on challenges facing the industry last week.

Professor Laura Ballotta, Director of the Quants cluster of MSc programmes, launched proceedings by setting out how the MSc in Quantitative Finance has evolved highlighting partnerships with respected institutions such as the Korea Advanced Institute of Science & Technology (KAIST) and Singapore Management University (SMU).

She also noted how the integration of the MSc in Quantitative Finance with other programmes at Bayes, in particular the MSc in Financial Mathematics and MSc in Mathematical Trading and Finance, has significantly enriched the curriculum.

The pioneering research work of faculty members involved in these programmes, Professor Ballotta said, acknowledging how their pioneering research work in related fields enriches student experience and influences contemporary industry practice.

The panel discussion addressed several pressing topics, including the impact of emerging technologies and risks on the future of quantitative finance.

A new generation of risks

Panellists agreed these include new risks such as climate change, AI/ML risk, and geopolitical challenges. Responding to many of these, they agreed, is difficult given the scarcity of historical data to allow proper evaluation. This complicates the understanding of their transmission to traditional financial risks. Market generators were seen as essential tools for studying the robustness of industry models in the presence of these new risks, although their statistical accuracy is still to be critically assessed.

The panel also explored the evolution of essential skills in the field. While classical skills such as programming, stochastic analysis, and financial econometrics remain vital, the conversation underscored the importance of human judgement, questioning of assumptions and lateral thinking. One panel member pointed out that soft skills and the ability to think across disciplinary boundaries are crucial for professionals who hope to navigate and thrive in the world of modern finance.

The power of ethics

Ethics and responsibility emerged as critical themes. The need for industry players to evaluate their readiness to responsibly use generative AI and other models was emphasised.

Panel members included:

  • Jos Gheerardyn, Co-founder and CEO of Yields
  • Marco Neffelli (Quantitative Finance graduate, 2016), Senior Investment Analyst, Legal and General
  • Mirela Predescu, Head of RISK Quant Academy, BNP Paribas
  • Carina Sander (Financial Mathematics graduate, 2021), Global Infrastructure Finance, Citi
  • Wafaa Schiefler, Commodity Derivatives Quant at JPMorgan Chase & Co.

Professor Ballotta said: “The insights shared by the panellists provided valuable perspectives on key issues that the quantitative finance industry must address to harness technology effectively and tackle new challenges, including climate risk.

“Looking ahead, Bayes Business School plans to organise more events that will bring together current professionals in the field of quantitative finance, plus students and alumni of the MSc Quantitative Finance (and its associated degree programmes). If this panel event is anything to go by, the sharing of insights and fresh perspectives will be stimulating to all and particularly valuable to students.”

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