Financial Services Careers

The financial services industry comprises a wide arena of organizations, which are scattered through various categories of businesses. These include brokerages, credit card issuers, mortgage providers, and banks. In view of this, skilled experts are needed, who are trained completely with respect to various IT fields such as programming, operations, databases, systems design and analysis, and networks and telecommunications.

This is actually the field where people could be made satisfied with growth, money and stress. Actuaries, who work for the broader financial services industry, are employed under different categories in the broadest variety of ways that could be thought, and the stakes associated with them are often valued in billions of dollars. The stresses are atypical of the actuarial field as a whole, but the compensation is, too.

This work is an extension of the insurance and pension management, which actuaries have done for generations. In insurance and pension management, actuaries are often called upon to measure the risks and rewards of investments that pension funds use to ensure they can pay benefits to their clients. This concept is also based on the same principle but for the fact that they are being called upon for providing the best risk-reward ratio, which is possible for maximum profits.

Of course, banks and credit issuers have used actuarial models for years. The credit scores used to measure individual credit worthiness were developed in part through the hard work of actuaries. Everyone knows that a person in debt will have a harder time managing more debt.

But actuaries can look at that debt and determine formulas for just how much debt a person can manage, what kind of debt is appropriate and what interest rate is appropriate for the bank to charge in order to mitigate the credit risk.

Actuaries are also being used by proprietary trading desks, mutual funds and hedge funds to study potential trades for unforeseen risks and to help mitigate the risks involved through hedging strategies. Whether the investment involves stocks, bonds, currencies, commodities, even options and futures strategies, there's always risk, and more and more, companies believe actuaries can help minimize those risks. Investing can always be compared to gambling, but it's always beneficial for a gambler to know the odds and then take the game to his or her favor. The actuaries in the financial services industries are also known for often donning the mask of a gambler.

Actuaries are also called upon to help construct investment vehicles for sale to institutional and public buyers. A major broker won't build a new hedging product for its high-net-worth clients without having an actuary on hand to crunch the numbers and determine the risk profiles.

Even investment banks use actuaries to help determine the risks and benefits of merger and acquisition deals. Though this is still rare, a handful of actuaries have been called upon to help crunch numbers and come up with risk-reward situations for a variety of factors in a given merger.

More and more investor assets are being put to work in the global market place every day, and everyone in the game wants to make sure each trade is worth the risk. Actuaries will become an increasingly important part of the investment and financial industries for years to come.

Hiring the Best That Money Can Buy

The financial services companies can always be quoted as the first and most eager IT adopters, mostly because of the fact that these organizations handle huge quantities of numbers and documents in a variety of different ways. As per Gary Simms, operational risk management director for Freddie Mac, the U.S.-government chartered company, located in McLean, VA, the company used technology in a variety of ways for the minimization of costs. This aids the company in maintaining a continuous flow of money to mortgage lenders, who support the home and rental housing markets. Simms also stresses the fact that if the usage of technology can help in improving the functioning, efficiency, and cost management of a company, it is always better to adapt to that technology at the earliest.

Growing Trend Towards Combined Education

A number of short-term and long-term courses on financial IT are being started by an increasing number of universities and their affiliated colleges. Some examples of such courses are mentioned below:

  • Master's degree in financial engineering by Polytechnic University
  • Management of technology in financial services by Polytechnic University
  • Graduate level programs in financial IT by other universities such as the University of California at Berkeley, Kent State College, Claremont Graduate University, and Princeton University

If earlier days are to be referred, finance was never taught in combination with IT management. However, in the current scenario, IT people with some knowledge of finance theory and practice are needed in large numbers. There is also a growing room for the finance people who have the required skills and talent for the management of the technology process.