Of those who will be graduating with degrees in physics this year, around a half will go on to further study (doing a PhD is the most popular option). In the following years, I also worked at Goldman Sachs, Deutsche Bank, and Merrill Lynch, where I ran several different lines of business. This is because banking has become reliant on mathematical modelling, and the people who are best at this are physics, maths and … This is because employers place high value on the analytical, technical and problem-solving skills that physics … Of course, Caltech obviously wasn't the easiest place to study, and there were times when I had my doubts about whether I could do it. Impact: Low. I was building a diagnostic experiment to measure the plasma density, and waiting around for the main reactor to start. If you have an extra 1000 physics Ph.D.s that want finance jobs, then you'll flood the market. It is actually about providing the utmost transparency to managers about what can happen to their portfolios. Today, Luke oversees risk management for Alphadyne Asset Management, a $4.5-billion investment management firm with offices in New York, London, and Tokyo. Go to first unread Skip to page: Jasop Badges: 0. One such insight is that the greater diversification of risk might actually increase systemic risk, not decrease it, as one might naively think. Whatever your field of study, I think it's important to not get too hung up on where you are in your career today. It's about giving people the necessary information so they know the potential downside risks they take when making investments and allowing them to make informed decisions about risk and return. The ability to stay nimble and open-minded is a key skill. A physics degree is also excellent preparation for a variety of careers that seemingly have nothing to do with physics, such as careers in finance and marketing. The network idea brings together the analysis of many superficially very different systems. In 1994, I finished my business degree, and in 1995, I graduated with my PhD in physics. Philosophically, what we mean by risk management is not what most people think. His explanation invoked the idea that very large numbers of tiny molecules, much smaller than the pollen grains, are responsible for kicking the grains around. The world is going to change and you will need to change with it. A physics degree is also excellent preparation for a variety of careers that seemingly have nothing to do with physics, such as careers in finance and marketing. Jobs directly related to your degree include: 1. Financial institutions collectively form a network and, by understanding the global properties of the network, it is possible to gain key insights into its function. Applications developer 3. Actuary 2. Technical authorJobs where your degree would be useful include: 1. They seemed to think that I was good with people so they made me a structurer, designing financial products for clients. Available for everyone, funded by readers. Intellectual connections such as these are why so many physicists are interested in problems in finance and, in part, why so many have been recruited into the financial sector. Five years later, the same ideas were used by a young Albert Einstein to explain why pollen grains zigzag when they are suspended in water. start new discussion reply. Eventually, it started up, but one day, about six months into it, the part that carried electrical current to the magnetic field coils of the reactor just melted due to the excessive heat load. It is a little bit of a roundabout story. I also learned the discipline of trading and risk management, which would serve me well later on. The paper was set in the context of population stability in ecological networks and, in simple terms, it is the idea that by complicating matters we increase the numbers of ways something can go wrong. The US graduates about 1000-1500 physics Ph.D.'s and adding or removing 200-300 will radically change the job market. Thus, an associate physics degree will usually be a steppingstone into more advanced study. Clinical scientist, medical physics 3. It turned out to be fascinating because I could see that basic finance problems were the same as physics and engineering problems but with different semantics. That epiphany got me really interested in derivatives, which are a type of financial contract that can be traded, and I ended up taking a slew of finance classes over the next two years while I was working on my physics degree. As long as you are learning and being challenged, you will be OK. You could use your mathematical proficiency to enter into the financial world, or your knowledge of technological innovation to head into a relevant field of the legal sector (such as patent law or forensics). Thomas Luke (BS '86) came to Caltech to follow his dream of studying physics, but like many college students he found that life sometimes takes you to places you don't expect. Notice the generality of the language – we speak of "systems" and their "components". The Black-Scholes equation provided a means to value "European options", which is the right to buy or sell an asset at a specified time in the future. Never underestimate the importance of fundamentals, even in topics that you think are out of your current scope. At Caltech, we pushed ourselves so hard, there isn't anything I face today that challenges me to the point I say, "I can't do it." In physics, I was part of the Alcator C-Mod project, which was a big U.S. Department Of Energy-funded fusion reactor. I really had no idea about Wall Street when I was at Caltech. 1 thing you learn at Caltech is how to think. Most of the CSFB employees were mathematicians and/or physicists with PhDs. At the time, Wall Street was at the tail end of a hiring spree for technical people to work on derivatives and options—another type of financial contract—and I got offers from almost every bank on the Street. Theoretical developments in statistical physics and complex systems may be able to help. By then, I was convinced I could contribute more to developing derivative markets in finance than fusion energy. That was how the Street was back then. Exotic derivatives were the most complicated type of options at the time. The problems are interdisciplinary, so the solutions have to be as well. It also helps that physicists tend to be good at computer modelling and working with large data sets. Going into finance with a physics degree Watch. Precisely the same ideas are used to model the financial markets, in which case the "system" could be the price of an asset and the "components" would then be the range of things that can influence its price. Thomas Luke (second from left) during his undergraduate years, pictured here with Richard Feynman (second from right). After two years, I decided I wanted to be a trader. Nanotechnologist 8. 0 Meteorologist 7. Today, Luke oversees risk management for Alphadyne Asset Management, a $4.5-billion investment management firm with offices in New York, London, and Tokyo. I must say it was a lot of fun. The financial crisis of 2008 hit while I was at Merrill Lynch, which ended up merging with Bank of America. This 60–credit, two–year program will provide you with introductory level instruction in subjects … Furthermore, many of those who stay on to PhD level and beyond eventually leave academia to work in the financial sector, often at senior levels in investment banks. Today, these ideas have been developed into a means of computing the value of sophisticated financial instruments and the management of risk. This was a crucial insight and provided one of the earliest convincing confirmations of the existence of atoms. As a particle physicist, I work with systems containing just a few particles and because the number of particles is not too great I can keep track of the ways they can interact with one another.