close window 
Quantitative investing is applying financial theory and quantitative techniques to investing, said Guy Lakonishok, ’09, a quantitative analyst at LSV. “Financial theory really should be the basis for your investment strategies, so you know why the models work,” Lakonishok said during a presentation, sponsored by the Investment Management Group, at Gleacher Center on January 8.
Booth MBAs are in the right place to prepare for a career in quantitative investing, he said. “You are at the best school for financial theory,” Lakonishok said. “Professors here conduct research that has real-world applications. If you want to go into this field, you should be aware of their work, read their research, and talk to them.”
The spectrum of quantitative work can range from math-based analysis that rivals astrophysics to “pseudoquants” that apply quantitative techniquesempirically tested financial theory, he said. “Most quants lie somewhere in the middle,” Lakonishok said. “Some have academic experience, or PhDs in finance. At the very least, you should have a very deep interest in financial research. You should be the type of person interested in picking up the Journal of Finance and reading an academic paper.”
A firm such as LSV is divided among operations and compliance, investment, new business development, and client services, said Scott Kemper, ’06, partner and director of client portfolio services. Often called “product specialists,” representatives of client services must be both experts in all of the firm’s 25 investment strategies and skilled at managing relationships, Kemper said.
“In my role, I need to do essentially what a portfolio manager does at a fundamental shop when he or she meets with clients,” he said. “It’s very technically driven. I need to really stay on top of what’s driving markets around the world and what’s driving the performance of our products. Product specialists generally enjoy people. I love getting out and meeting with our clients. If you enjoy the technical aspects of the investment world but you consider yourself a people person, this might be an avenue for you.”
While at Booth, MBAs should focus on learning how to sell themselves and their ideas to better prepare for a career as a product specialist or in business development at an investment firm, Kemper said. “It’s always important to learn how to sell,” he said. “You just can’t get enough experience doing that. Whether it’s in your classes, in a group discussion, it’s important to learn how to effectively present a story or an argument to an audience. Regardless the role you aspire to in the investment field, this will be a valuable skill to possess.”
Kemper and Lakonishok shared an unusual combination of experience in both applying quantitative models to investing and actually meeting with clients to explain the process and strategy, said evening student Mike Alkhazov, co-chair of the Evening MBA Program and Weekend MBA Program Investment Management Group. “This was really a unique opportunity to have somebody on the business side of money management and somebody who’s actually constructing the projects,” Alkhazov said.
—Phil Rockrohr