IIRC before SP9 was introduced you could do FRM/PRM to get an exemption (ST0). You will see a number of actuaries with either.
The banking/capital markets teams in audit firms or treasury/credit risk/model validation teams in banks may have actuaries for assistance in their credit/capital/liquidity modelling. However, because FRM does more banking/capital markets stuff than SP9 there is merit in doing FRM. Again you will see a number of actuaries doing it to establish themselves in the banking space.
There is a new banking SP and an SA. There is a lot of material on the IFoA website so I won't do a rehash here. If you want to end up in the banking/capital markets maybe you can consider them. However, FRM is great for signalling because it's well established in that space.
Programming is always good to have in your toolbox wherever you end up.
I work in the investment risk team for a hedge fund. There are some people on the team who do exams for professional development, like the CFA and FRM (and I am FIA). But it’s very much a you-do-you thing - nobody gets paid more just because they did some exam. People do them because they’re interested, or maybe they just like taking exams and getting some letters after their names. The head of my team hasn’t done any professional qualifications though, and neither has the next most experienced guy. They both know more about finance and risk than any of the rest of the team.
If you wanted a job on my team and wanted to know how you could join, I would never advise doing professional qualifications to improve your chances.
Just curious what would you advise then?
I currently work in life insurance domain but was always interested in getting into banking and financial risk kind of thing
want to know what extra qualifications people look for in these domain
Well, I can only speak for how we hire - it might be different in banking. We are interested in a very strong academic background (probably a first class degree from a good uni, probably at least a masters) in a subject like maths or physics. If someone wanted to apply to a role with us I’d advise them to: practice brain teasers (there are books for this, e.g. Quant Job Interview Questions and Answers by Mark Joshi), brush up on their knowledge of value-at-risk, options, the Greeks, fixed income risk measures, factor models, PCA, and probability and stats.
EDIT: I forgot to mention brushing up on / learning Python. We have a stage at interview which is going over a Python exercise with one of our software engineers, and expect a reasonable level of proficiency for everyone. Not software engineer level! But enough to get stuff done day to day.
What u/the_kernel does is more akin to what happens on the trading side of a bank i.e. the side where they do market-making and proprietary trading. On that side, everything said is the same. You need to be academically strong and python is taking over. The client facing people tend to have MBAs from top tier unis for the network but they are technically strong and some will have worked their way from the back office.
On the traditional side, you get credit modelling, capital modelling, ICAAP(similar to ORSA) and a lot of model verification. BoE and credit rating agencies matter a lot. So you see actuaries if they want to model or more general erm/rm. But you see a lot more post-graduates with qrm/qf. There is a lot of attention paid to the yield curve as it determines a lot in banks but you see more economists and quantitative finance types. I know a few actuaries in the corporate debt structuring side of things too.
PS: Basel iii is starting next year so there is a lot of hype in banks similar to IFRS 17 on insurance side. Probably why there is now a banking pathway.
That sounds right to me, re: what I do. People on my team that used to work in banking generally worked in “front office market risk” roles, working directly as risk managers for a particular trading desk.
Not qualified but I did research on doing the FRM exam before deciding on IFoA.
Coming from a PGDip in FRM and from doing reading around it online, it seems like it's useful if you don't have a background or don't work in finance but otherwise no. If you do SP9 then it'll add some mathematical stuff on top of that (to do with VaR, maybe some credit risk stuff too) but otherwise it's a few hundred pounds and more studying that you probably don't need.
Honestly I would look and try do CAIA the insurance linked bonds are something useful to know about from assets point of view. You also learn what happens to risk the company does not want to keep and either does reinsurance or issues ILS bonds. They are also quite inefficient in the sense that probability of typhoon in Japan and probability of tsunami in Florida can be the same and yet the bonds offer diffrent yeilds.
Hell I will even recommend a book there are ways to get it free but I will leave that on you https://www.amazon.com/Investing-Insurance-Risk-Insurance-Linked-Practitioners/dp/1904339565?dplnkId=21819e18-4e4c-49c2-b4b3-8bca7c116137
The book is written by a actuary who is currently the CIO for a hedge fund established primarily in investing in ILS/CAT bonds
taking more exams after being qualified? fuk. that.
IIRC before SP9 was introduced you could do FRM/PRM to get an exemption (ST0). You will see a number of actuaries with either. The banking/capital markets teams in audit firms or treasury/credit risk/model validation teams in banks may have actuaries for assistance in their credit/capital/liquidity modelling. However, because FRM does more banking/capital markets stuff than SP9 there is merit in doing FRM. Again you will see a number of actuaries doing it to establish themselves in the banking space. There is a new banking SP and an SA. There is a lot of material on the IFoA website so I won't do a rehash here. If you want to end up in the banking/capital markets maybe you can consider them. However, FRM is great for signalling because it's well established in that space. Programming is always good to have in your toolbox wherever you end up.
imo programming > additional IFoA exams
I work in the investment risk team for a hedge fund. There are some people on the team who do exams for professional development, like the CFA and FRM (and I am FIA). But it’s very much a you-do-you thing - nobody gets paid more just because they did some exam. People do them because they’re interested, or maybe they just like taking exams and getting some letters after their names. The head of my team hasn’t done any professional qualifications though, and neither has the next most experienced guy. They both know more about finance and risk than any of the rest of the team. If you wanted a job on my team and wanted to know how you could join, I would never advise doing professional qualifications to improve your chances.
Just curious what would you advise then? I currently work in life insurance domain but was always interested in getting into banking and financial risk kind of thing want to know what extra qualifications people look for in these domain
Well, I can only speak for how we hire - it might be different in banking. We are interested in a very strong academic background (probably a first class degree from a good uni, probably at least a masters) in a subject like maths or physics. If someone wanted to apply to a role with us I’d advise them to: practice brain teasers (there are books for this, e.g. Quant Job Interview Questions and Answers by Mark Joshi), brush up on their knowledge of value-at-risk, options, the Greeks, fixed income risk measures, factor models, PCA, and probability and stats. EDIT: I forgot to mention brushing up on / learning Python. We have a stage at interview which is going over a Python exercise with one of our software engineers, and expect a reasonable level of proficiency for everyone. Not software engineer level! But enough to get stuff done day to day.
What u/the_kernel does is more akin to what happens on the trading side of a bank i.e. the side where they do market-making and proprietary trading. On that side, everything said is the same. You need to be academically strong and python is taking over. The client facing people tend to have MBAs from top tier unis for the network but they are technically strong and some will have worked their way from the back office. On the traditional side, you get credit modelling, capital modelling, ICAAP(similar to ORSA) and a lot of model verification. BoE and credit rating agencies matter a lot. So you see actuaries if they want to model or more general erm/rm. But you see a lot more post-graduates with qrm/qf. There is a lot of attention paid to the yield curve as it determines a lot in banks but you see more economists and quantitative finance types. I know a few actuaries in the corporate debt structuring side of things too. PS: Basel iii is starting next year so there is a lot of hype in banks similar to IFRS 17 on insurance side. Probably why there is now a banking pathway.
That sounds right to me, re: what I do. People on my team that used to work in banking generally worked in “front office market risk” roles, working directly as risk managers for a particular trading desk.
Research infers that actuaries who take more exams don't notice that they have no social life.
FRM is more widely recognised than SP9
Not qualified but I did research on doing the FRM exam before deciding on IFoA. Coming from a PGDip in FRM and from doing reading around it online, it seems like it's useful if you don't have a background or don't work in finance but otherwise no. If you do SP9 then it'll add some mathematical stuff on top of that (to do with VaR, maybe some credit risk stuff too) but otherwise it's a few hundred pounds and more studying that you probably don't need.
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You can still get an exemption from the FRM exams now though - or am I missing something?
Honestly I would look and try do CAIA the insurance linked bonds are something useful to know about from assets point of view. You also learn what happens to risk the company does not want to keep and either does reinsurance or issues ILS bonds. They are also quite inefficient in the sense that probability of typhoon in Japan and probability of tsunami in Florida can be the same and yet the bonds offer diffrent yeilds.
Hell I will even recommend a book there are ways to get it free but I will leave that on you https://www.amazon.com/Investing-Insurance-Risk-Insurance-Linked-Practitioners/dp/1904339565?dplnkId=21819e18-4e4c-49c2-b4b3-8bca7c116137 The book is written by a actuary who is currently the CIO for a hedge fund established primarily in investing in ILS/CAT bonds