Financial Engineering Master's Program
Bring a quantitative approach to the complex technical challenges facing the finance industry, ensuring you can create value throughout your career.
The finance world's rapid transition to a digital discipline has created incredible opportunities for experts in computer science, statistics, economics and mathematics to develop solutions to increasingly complex problems, such as how to value an asset, how to assess risk and the smartest ways to manage a portfolio. Quants are some of the most-sought professionals on Wall Street for their coding versatility and ability to model financial data to drive better decision-making.
The Financial Engineering program at Stevens resides in the School of Business, giving it a practical orientation that few other programs offer. Lessons emphasize how technical tools can address specific challenges in the markets, while preparing you to identify inefficiencies, recognize opportunities and develop innovative new products. The Stevens program also recognizes the systemic nature of financial markets and prepares you for the challenges of working in large, interconnected environments.
The Financial Engineering program at the School of Business ranked #19 in QuantNet's 2023 Best Financial Engineering Masters programs in the United States. The 2023 QuantNet ranking is the most authoritative and comprehensive ranking of best Financial Engineering programs in the United States.
No graduate business education is complete without an opportunity to apply what you've learned on a project of consequence. At Stevens, that takes many forms — a consulting assignment with an industry partner, a research project that addresses an industry need, even the chance to nurture your own entrepreneurial venture — and is customized for you, your education and your career aspirations.
The quantitative and systems-intensive perspective of the master's program prepares students to use financial engineering techniques to solve problems in securities valuation, risk management, portfolio structuring and regulatory concerns, with an emphasis on stochastic modeling, optimization and simulation techniques. The 30-credit degree includes six required courses that emphasize quantitative finance, financial services analytics, financial risk and regulation, and financial systems. As part of the degree, students are encouraged to take an integrated four-course certificate that allows for additional expertise in a particular discipline of their choosing.
This course provides the mathematical foundation for understanding modern financial theory. It includes topics such as basic probability, random variables, discrete continuous distributions, random processes, Brownian motion and an introduction to Ito’s calculus. Applications to financial instruments are discussed throughout the course.
This course deals with basic financial derivatives theory, arbitrage, hedging and risk. The theory discusses Ito’s lemma, the diffusion equation and parabolic partial differential equations, and the Black-Scholes model and formulae. The course includes applications of asset price random walks, the log-normal distribution and estimating volatility from historic data. Numerical techniques, such as finite difference and binomial methods, are used to value options for practical examples. Financial information and software packages available on the Internet are used for modeling and analysis.
This course provides computational tools used in industry by the modern financial analyst. The current financial models and algorithms are further studied and numerically analyzed using regression and time series analysis, decision methods, and simulation techniques. The results are applied to forecasting involving asset pricing, hedging, portfolio and risk assessment, some portfolio and risk management models, investment strategies, and other relevant financial problems. Emphasis will be placed on using modern software.
This course introduces the modern portfolio theory and optimal portfolio selection using optimization techniques, such as linear programming. Topics include contingent investment decisions, deferral options, combination options, and mergers and acquisitions. The course introduces various concepts of financial risk measures.
This course deals with fixed-income securities and interest-rate sensitive instruments. Topics include term structure of interest rates, treasury securities, strips, swaps, swaptions, one-factor and two-factor interest rate models, Heath-Jarrow-Merton (HJM) models, and credit derivatives — credit default swaps, collateralized debt obligations, and mortgage-backed securities.
This course is designed for FE students undertaking a research or a project in financial engineering either individually or as a group. The project may be suggested either by faculty members or industry senior managers associated with your internship, as well as any internship that a student may receive through this course. The goal of this course is to involve students in developing research skills, communication skills while keeping their interest in result-oriented techniques. The ability to work on a research-oriented project in a group environment and train their professional presentation and scientific writing skills lead to a competitive graduate who is ready to lead in the work place.
Electives & Certificates
In addition to the six core courses above, students need to complete four additional elective classes for a total of 12 credits. Those 12 credits may be any courses the advisor approves. In particular, students may choose to complete the elective courses from one of the following graduate certificate programs. This would allow students to graduate with a master’s degree and a graduate certificate at the same time.
This concentration emphasizes the design and implementation of financial trading systems in dynamic markets, with special focus on how software and automated decision support systems play roles in trading strategies. To complete this concentration, students must take the following courses:
The Financial Analytics concentration emphasizes statistical learning methods and database skills, preparing students to develop tools to manage enterprise-level challenges. Students apply data-driven solutions to complex financial problems in preparation for an industry in increasing need of such skills. To complete this concentration, students must take the following courses:
Technology’s impact on market fundamentals means managers must understand the financial system, its environment and the risk measures that help quantify risk in its multiple hierarchies. Courses in this concentration emphasize a blend of technology and business to help graduates see the financial landscape from a systemic perspective, and to analyze and manage risk efficiently. To complete this concentration, students must take the following courses:
Students also complete an additional elective with advisor permission.
Proper statistical analysis, supported by new technology tools, helps managers assess markets and build products to create competitive advantages for the enterprise. This concentration gives students insight into technology-driven opportunities in finance through advanced data analytics. To complete this concentration, students must take the following courses:
This concentration goes beyond basic programming and computing skills to teach students to use quantitative models to manage large financial data sets. Students learn financial computing models, financial databases, financial engineering software and specialized programming languages. To complete this concentration, students must take the following courses:
FE 511 Introduction to Bloomberg and Thomson Reuters (1-credit lab)
FE 699 Project in Financial Computing (2 credits)
Students also complete an additional elective with advisor permission.
The master’s in Financial Engineering offers professionals a cutting-edge blend of applied mathematics, computational techniques and statistical analyses, combined with basic financial and economic theory. Because of the highly technical nature of a financial engineer's work, students are required to have an academic or professional background that prepares them to excel in such an environment.
Full-time applications to the Financial Engineering program are accepted in three distinct cycles. To be considered for admission, all materials must be submitted by the deadline.
Included in admission offer
Part-time applications to this program are accepted on a rolling basis.
Admission to the Financial Engineering master’s program is very competitive. To be considered for this program, your application must include the following.
Your application must include official transcripts from all universities you have attended, or in which you are currently enrolled. These records must show your name, the name of the university attended, enrollment dates, coursework completed and grades assigned. Your bachelor's degree must be in science, mathematics, computer science, engineering or a related discipline. Your degree also must come from an accredited institution, and you must have attained a B average, to be considered.
Stevens often invites master's candidates to interview prior to making an admissions decision. If you are selected for an interview after submitting your application, you will receive instructions via email.
Your application must include two letters of recommendation. The strongest applications will include one letter from a current supervisor, and one from a former supervisor or previous employer who can speak to your leadership potential and discuss your professional performance.
All candidates to this program are required to submit GMAT or GRE scores with their application; part-time applicants with work experience may be eligible to waive this requirement. Only students with excellent test scores will be deemed a fit for the coursework. However, it's important to keep in mind that your test scores are only one feature of your application, and will be considered along with your other credentials. Please use the following reporting codes to submit test scores to Stevens:
International students also must include TOEFL or IELTS scores along with their applications.
Work experience is not a requirement for this master's program. However, the admissions committee values applicants with at least one year of professional experience. You must include a résumé with your application that highlights:
Work and internship experience.
Given the technical nature of this degree, students are required to have completed courses in each of the following disciplines prior to starting the program:
Calculus and differential equations.
Probability and statistics.
Programming (Java, C++, R or Python).
Stevens noncredit courses in these disciplines for students needing to satisfy these requirements.