The Asian finance sector urgently needs more investment professionals with strong quantitative skills, says one of the global pioneers of smart beta strategies.
“There’s certainly a talent shortage of quants in Asia,” says Jason Hsu, the founder and chairman of Rayliant Global Advisors, an Asia-focused quantitative equity investment firm. “Asia lacks seasoned quant researchers, and some of the ones here are too ‘local’ in their approach and aren’t equipped to work for international companies.”
Hsu says having quant skills is vital to long-term career success in Asian investment management. “It’s the key emerging area in the region, like the CFA was in Asia 20 years ago.”
Still, Hsu admits that quant research doesn’t yet have the same appeal as a career in Asia as it does in the US. Many investment professionals in the region aren’t aware of the growing need to add quant skills to their resumes, adds Hsu, who also co-founded US-based Research Affiliates in 2002, a firm that was among the first to develop smart beta strategies.
“In the US, people are a lot more experienced when they go to business school and they’ve have time to build up networks, so they’ve been guided to take their careers in a more quantitative direction by doing an advanced degree,” says Hsu, who also works as an adjunct professor in finance at UCLA's Anderson School of Management. “In Asia, people often go to business school straight after their degrees, or in their mid-20s.”
Amid this talent-short job market, Rayliant is expanding its quant research team, which is primarily based in Hong Kong. Hsu wants to hire people whose academic background includes an undergraduate degree in science, technology, engineering or mathematics and an advanced degree in finance or financial engineering.
“We need quants who are business people. To join us, you need a blend of quant skills and market intuition,” Hsu told eFinancialCareers at the recent CFA Institute Annual Conference in Hong Kong. “You can’t just be a scientist who doesn’t have experience in financial markets. It will take too much training to get you up and running.”
Although Hsu’s firm is not recruiting undergraduates, he advises students to first study statistics if they are interested in working in investment management. “The industry is increasingly becoming more quantitative, so if you don’t understand statistics and data and can’t use quant tools to test out portfolios, you won’t be able to be a fundamental researcher,” he says.
But data is just the starting point. “As a quant researcher, you have to think like an economist before you simply run lots of data, and that means understanding local markets,” adds Hsu. “In Asia, it also means being able to speak local languages. Even if you’re doing data work, you’ll still have to go to the source material, which may not be in English.”
Have a confidential story, tip, or comment you’d like to share? Contact: firstname.lastname@example.org
Image credit: agsandrew, Getty