Beginning in Fall 2013, the Financial Engineering Program was closed to new applications as its curriculum was reviewed. After this review, the decision was made that no new students will be admitted to this degree program. The Master of Science in Financial Engineering curriculum will continue to be available to all previously admitted students.
- Application deadline:
- Jan 15, Sep 15
- Ann Arbor, MI
University of Michigan Financial Engineering program
Michigan MFE is a full-time program offered by Michigan College of Engineering
The program has a strong mathematics portion. The University of Michigan has a great reputation however not very many people have heard of the MFE program. If you do go to this program and need advice ask Reza Kamaly as he is one of the few financial engineering teachers that cares about the students.
The program is lacking in depth financial theory. The program is only focused on mathematics with a hint of finance and minor programming. The administrators refuse to help students and couldn’t care less about you. The teachers have no interest in financial engineering since they all come from different fields of study and typically only teach one financial engineering course and then many other courses in their actual department.
The program has crammed so much work into the program that the only way many of the students are passing is through grouping. For example, students have formed groups by nationality and then the students divide up the homework between the students since it is near impossible to conduct all of the homework by yourself unless you already have a well-defined financial engineering background.
The teachers have no interest in financial engineering since they all come from different fields of study and typically only teach one financial engineering course and then many other courses in their actual department. The teachers are not financial engineers and only understand their one specialty. This is a large problem in trying to figure out how all of the different parts work together as a whole. The program is divided between Engineering, LSA (Literature, Science, and Arts), and Ross Business School so each professor only understands small portions of the material. Ross will be leaving the program after the 2013-2014 school year due to conflicts between Ross and Engineering.
The summer boot camp was a huge waste of time and money. You pay about $6,320 for the summer camp and you get nothing out of it except free coffee. The material is covered very quickly by some professors and PhD students. The material that covers your background will be too easy and you will learn next to nothing. The material that you need to learn is covered so fast that details and explanations on how to actually do it are not taught. Summer boot camp is mandatory and they threaten you that if you miss class that you will have to re-take it next summer. Many students skipped and nothing happened to them. If you do this program you are better off purchasing text books in your weak areas and then studying during the boot camp and in your free time.
There are basically no career services available. Ross business school has provided help with writing resumes and cover letters as well as interview preparation but they refuse to promote our program and will not let us tap into their alumni network or school clubs. As noted above Ross is pulling out and these resources will no longer be available. Engineering provides career fairs but all of the companies recruiting MFE students are looking for computer programmers. If you can’t code you won’t get a job at an engineering career fair. The location of Ann Arbor is too far from Chicago or New York and this makes job placement and networking difficult.
Internship placement for summer 2013 was around 24-30%. This is somewhat overstated since some of the students took internships unrelated to financial engineering to gain some work experience and to provide money for living. A few students however did land related internships.
68% Chinese, 10% Indian, 4% Japanese, 4% American, 4% Iranian, 2% Turkish, 2% French, 2% Greek, 2% Slovakian, and 2% Mexican . There is a total of 50 students. Like most programs the students group up by nationality and it is hard to relate or network with other students. The students’ backgrounds are almost all engineering or mathematics.
Look for other programs or consider a different field of study. Many other degrees could prepare you for a successful career in financial engineering. This program as well as many others lacks the development of social skills. Make sure you learn how to communicate effectively and learn how to network with everyone you meet.
The program is a good program if you only want to understand financial mathematics. If you are looking for a well-rounded program in finance, programming, and mathematics look elsewhere. I ended up adding a dual degree in Applied Economics so that I could obtain some flexibility in course selection and have spent a large amount of my personal time studying topics that the program doesn’t teach. The MFE program allows you to select three elective courses which is not enough to gain a specialty in anything except math. The job placement is very poor due to a lack of career services. The tuition is very high for what you get which could leave you unemployed or under employed with a lot of student debt. My overall rating of this program is very poor. If I knew what I know now I would have looked into other degrees besides financial engineering and networked my way into financial engineering.
What do you think is unique about this program?
Electives are the first big plus. Students have plenty of opportunities to branch out beyond the core requirements. I used this as a chance to load up on Ross courses and differentiate myself from students in other programs.
The professors are also a differentiating factor. The program director teaches the introductory options class and is outstanding at engaging the class while forcing us to think critically about the material. The computational finance professor is equally stellar, covering an absurd amount of material but presenting it a clear concise manner. By the end of the course we were able to code numerous option-pricing and interest rate models from scratch. Another standout is the numerical methods professor, a local quant hedge fund manager aware of the latest changes in the field. It is not uncommon for a quick conversation with him outside of class to turn into an hour-long discussion on the latest methods and computing techniques.
The university's brand name is another great resource. Michigan has a much stronger reputation on Wall Street than schools like Baruch, UCB, and UCLA. This couples nicely with the school's unusually responsive alumni network. There are therefore lots of opportunities to gain access to firms and positions that don't follow traditional recruiting patterns. This, in my opinion, is one the the biggest advantages of the program. However, the onus is on the student to tap this resource.
What are the weakest points about this program?
Career services without a doubt. Students are pretty much responsible for their own fate. We have access to the College of Engineering, Ross School of Business, and LSA career websites. Since Michigan is a top ten school for engineering, math, and business there are lots of jobs on these boards unavailable to other MFE programs. The downside is they are not specific to MFEs, so we often compete with other majors or are barred from applying. However, it is possible to network your way around these application barriers.
Like I said above, there are no MFE-specific career services. Most interviews come from the engineering school which is a target for many trading firms including Chicago Trading Company, Wolverine, Optiver, Getco, DRW, TransMarket, Spot, Jump, Chopper, and Belvedere. Larger firms like American Express, BlackRock, Citi, Bank of America, and JPMorgan recruit quants from there too. The Ross career website posts lots of finance opportunities as well and is frequented by all the Wall Street firms. This is how I got placed.
Internship placement for summer 2012 was around 75-80%, but I do not know the full-time figures. I'm unaware of anyone who didn't receive at least one interview. Most people I know had several with some getting more than you can count on both hands. As far as the program goes, pretty much everyone gets interviews. How they perform after that is up to them. Most of the class seems happy with their placement. The people in my study group were placed in trading or risk management roles at companies like American Express, Bank of America, Chicago Trading Company, and Transmarket. I will be trading structured credit at a bank (GS/MS/JPM).
My year was about 70% Chinese, 25% Indian, 5% other.
This review was submitted anonymously
What is unique about this program?
Nothing. Its got nothing different about it.
What are the weakest things about the program?
Its the staff. They are not really worried about students finding jobs upon graduation or not. They are not even willing to invite recruiters.
Below Average. Students have to find jobs on their own. If they are lucky enough they get an internship/full-time placement. For the past couple of years, about 20-30% of the students have been placed.
They do not generally find jobs in the finance and investment industry. They generally find jobs in the Financial Technology sector. Jobs like a trader or a quant analyst are a distant dream.
I heard about this program from a ranking website which tells Michigan ranks top 10 among FE programs. The ranking might change over time. But overall, this is a good program and a good place to learn.
Students need to take GRE in order to be considered. Most students get high mark in quantitative part, from 790 to 800. As for Verbal, it ranges from 300 to 600. Of course GRE is not everything you have to get the administration. Try to gain practice experience in quant finance related fields, this adds great points to your resume and might extend an offer for you.
Personally I like the program and enjoyed it a lot. This program holds about 50 students each year with different backgrounds, such as physics, software engineering, electronic engineering, finance, math, economics, etc. About half of them do not have working experiences before, and others have relative experiences in finance, IT, trading or other areas.
Usually students need to finish 39 credits in three academic semesters. The program begins with a summer boot camp which lasts from mid July to late August. The summer classes cover statistics, finance, programming, algebra, economic, etc. which are mostly foundations. There are also some interesting network event and outdoor games. All these help new students learn basic knowledge which they lack of and get familiar with their classmates and professors. I love the summer semester, we had lots of fun both inside and outside of class. However, the cost is expensive. Many students think they spend too much on the summer courses and some of the courses are not necessary to open since they are too abstract, because one month's time cannot give you a deep understanding in any area.
Students have lots of freedom in taking courses due to their career paths. They can choose to take courses from math school, college of engineering, and Ross school of business. Core courses cover stochastic process, markov chains, statistical methods in finance, optimization methods in finance, fixed income, financial engineering, capital market and investment strategy, portfolio management and investment, options and future in corporate decision make, computational finance etc. Others include risk management, programming skills in quant finance, trading, valuation, international finance, etc. I would say that all professors are pretty good and some courses open public lectures and invite speakers from trading firms, investment banks and hedge funds. There is also a small virtual trading room in business school. Students can learn to use softwares like bloomberg and factset. And most of the course projects require skills in quantitative analysis, MATLAB, C++ and R prog ramming. As you can see, the program is more mathematical and quantitative other than financial.
The career service is good as students can use career recourses both in engineering school and business school. However, most students complain that there is only limited recourses in business school open to MFE students. They cannot get as much chances as BBA or MBA. Although this is the case, many students can also get interviews from top investment banking and consulting firms, and finally get offer there.
Can you tell us a bit about your background?
Work Ex: Accounting and fixed income derivatives trading desk support. Educational background: Finance and computer science. I studied full-time in the program from 7/2008-4/30/2010
Why did you choose this program (over others, if applicable)?
I chose the Michigan program because of its flexibility, relationship with a strong MBA program, and the overall reputation of Michigan as a business school and in general.
Tell us about the application process at this program
Same as the other school's processes except that Michigan required a 2 minute video monologue. Did not have to correspond with the administration during the application process.
Does this program offer refresher courses for incoming students? How useful was it?
Michigan has a fairly intensive mandatory summer program from July-August and organized in a modular format. There are no grades but participation in all modules is mandatory.
The program covers all fundamental topics from corporate finance to calculus to C++. Because of its broad scope, most students including myself found some parts useful and some parts not. For e.g. I had a strong finance background so the finance & econ segments were useless to me, whereas the I was very happy to have the calculus, probability and stats because my math background was relatively weak; most students had strong math backgrounds and so many felt the other way around. Overall my opinion of the program was positive for these reasons: gets you back into academic mode if you've been away from academics for a while, and it gives you the chance and time to brush up on areas of weakness ahead of some very demanding semesters.
Tell us about the courses selection in this program. Any special courses you like?
The flexibility of the curriculum was one of the biggest draws for me. A large proportion of credits are electives, and you can direct these elective credits toward making your program very quantitative or less quant-heavy. I was never interested in becoming a "quant" and the Michigan program allowed me to get about a 60-40 split between quantitative and MBA finance courses. However, one can make it 80-20 or more if one wishes.
My favorite quant finance courses were the capstone Financial Engineering II and Computational Finance courses because they made you actually do, instead of just passively learn, financial engineering type stuff. The FE II course had a heavy amount of project work and if you are looking for quant roles, you would have several instances of self-contained, practical project work that you could show employers. The computational finance course is all very hands-on type of work, with most students choosing Matlab for implementation. Both classes are requisites and are very demanding.
My favorite MBA finance courses were Advanced Equity Security Analysis (fundamental stock selection taught by a seasoned buy-side PM), Financial Trading (practical market making course), Private Equity (all work is on live PE deals with tremendous exposure to industry players), and Applied Financial Analysis and Portfolio Management (practical course where you play the part of a buy-side sector analyst on a real equity fund). These courses are all electives. Note that you can take a PE course in an MFE program. You can actually take just about any higher level MBA finance course as an elective.
Tell us about the quality of teaching
I thought that most instructors were good, a couple were unforgettably amazing, and a couple were completely forgettable. A significant downside to the Michigan program in my opinion is the dearth of practitioners. Although there is a lot of solid theory behind it, finance is a craft, and no matter how well you know your subject matter and how good a teacher you are, you cannot teach what a practitioner can, which is the craft side of it.
There were TAs for just about every class but I never used them [because I'm so smart].
Materials used in the program
For the quantitative finance courses: Shreve I & II, Tomas Björk (arb theory in continuous time), Glasserman (MC methods in FE), Wilmott (mathematics of financial derivatives), Hull, Cornuejols (optimization methods in finance).
Programming component of the program
Depending on what electives you take, there can be a lot of programming. Among the required courses, there are three courses that require programming. For two of these you can choose to use whatever applications you want, with most students choosing Matlab, and for the third we used R.
All projects were group projects. Among the required quantitative finance courses, examples of projects were modeling the implied vol surface for equity options and modeling the yield curve using various interest rate models. There are quantitative finance electives which I did not take that have very heavy project work. The MBA finance electives I took had a lot of very practical project work. In my opinion there is enough project work that you can do and have to show employers examples of your work.
The MFE program is housed in the engineering school but is a JV between the engineering side and the business school. MFEs now have full access to both engineering recruitment and business school recruitment resources (on-campus hiring, alumni databases, career counseling, etc). In the past access to b-school resources was curbed but no longer; and from now on there should be an escalation of hiring opps through the b-school as the MFE program gets more visibility amongst recruiters who traditionally came to the b-school knowing only the b-school talent pool.
A word of caution for prospective students with full-time work ex: Michigan is by and large not a target school for associate-level sales & trading recruiters. Banks are happy to interview and hire MFEs without full-time work ex (or very limited full-time work ex) for analyst positions, i.e. they club MFEs without work ex along with bachelors students in the b-school. However they just don't seem to like Michigan for associate-level hiring into sales & trading; they seem to go to Chicago and Wharton & the other ivies.
On another note, we unfortunately don't get the hedge funds that NYU and Columbia probably get being in Manhattan, but we do get some prop trading firms given our proximity to Chicago.
Can you comment on the social interaction between students of different ethnics, nationalities in the program?
There was a fair amount of cross-ethnic interaction as far as coursework went, but as far as "socializing" went, my take on it is that a large portion of the Chinese students did cordon themselves off whereas most other people intermingled. Also, I put socializing in quotes because we are talking about MFEs, and MFEs (in all programs, not just U-M) aren't the most gregarious creatures in the world.
What do you like about the program?
The flexibility of the program. The ability to get a mix of quantitative and non-quantitative finance coursework. Michigan alumni network.
What DON’T you like about the program?
Not enough practitioners on the faculty, a serious negative in my opinion.
Not enough financial engineering specific career counseling. There's counseling through the b-school and there's counseling through engineering, but they are not very useful for MFE students, who have their own differentiated backgrounds, skill sets, and career focuses.
Suggestions for the program to make it better
The program should have a focused and comprehensive career services effort especially for MFE students, i.e. career services beyond a resume book, resume critiquing, general interview prep, etc.
The program also needs more marketing, it is a very good program but I believe that it does not have enough visibility amongst other MFE programs and other Masters programs in general.
Besides the program's websites, what alternative sources of info you used to learn more about the program?
Forums (especially QuantNet) and alumni.