Academic Program. Management of risk is a necessity in today’s highly leveraged, highly competitive, global economy. Using advanced quantitative methods and path-breaking concepts of strategic planning, financial engineering has emerged as a new and specialized discipline. Financial engineering focuses on designing, evaluating, and managing financial products and using real options to support strategic objectives. This intensive degree program prepares graduates for careers in a broad range of specialties including asset management, investment banking, corporate finance, and consulting.

The Admissions Process. An applicant to the program should have a strong quantitative undergraduate background, and preferably some experience in using mathematical software. Some background in business or economics is desirable. An undergraduate degree in mathematics, physical science, engineering, or economics is an advantage. Each student will acquire advanced quantitative and managerial tools in the course of the program.

An applicant must submit a completed application, application fee, transcripts of all undergraduate and graduate work completed, three letters of reference, résumé, personal statement, and GMAT or GRE scores to the Office of Admission and Records at Claremont Graduate University. Non-native speakers of English also must submit TOEFL test scores. The admissions committee reviews applicants for clear indications of analytical and leadership ability, particularly in quantitative work.

Quantitative Work. Applicants are expected to have completed Calculus III through multivariate calculus and to have completed linear algebra with a grade of B or better.

Course Requirements. The program consists of 12 courses of 4 units each, for a total of 48 units. Some students may need to take additional fundamental courses. The 12 courses include:

• four required courses in mathematics.

Probability
Statistics
Stochastic Processes
Mathematical Finance

• four required courses in management.

Accounting
Corporate Finance
Asset Management Practicum
Derivatives and Risk Management

• four approved courses in mathematics, management, or economics selected from the list of approved elective courses.

The program can be completed in three semesters of 16 units each, but many students choose to spread the degree over four semesters. The program can also be completed on a part-time basis and students may elect to switch between full-time and part-time. A student with sufficiently strong mathematical background may request a waiver of one or more required courses and substitute elective courses. Management courses may be waived on the same basis. A student may, with the agreement of a faculty sponsor, elect to do an internship for 4 units of credit, counted as a management elective. A student must maintain an average grade of B (3.0) or better in the 48 units to qualify for the degree. A student whose overall grade point average falls below a B and who does not make satisfactory progress toward completion of the degree may be dropped from the program upon faculty review at any time during the course of study. Grades below B- are considered by the program to be unsatisfactory and requiring of remedial action, as determined by the academic directors in mathematics and finance. A student who receives a grade below B- but believes that the knowledge expectations of the course have been met may submit a written petition to the directors of the program for their review, requesting that the grade lower than a B- be accepted as satisfactory, however the overall G.P.A. must remain at or above a 3.0.

Additional Requirements and Policies

A student may be permitted to transfer up to 8 graduate-level semester units of credit toward the M.S.F.E. This requires a grade of B or better attained in a faculty-approved course from an accredited graduate institution within five years of the student’s enrollment at CGU. A student requesting a transfer of units must submit transcripts, syllabi, and documentation of coursework to the program coordinator. The request for transfer must be approved at the beginning of enrollment. Information on continuous registration, master’s program outlines, and other general requirements can be found in the “Degree Regulations ” section of this Bulletin.

Field Study in Financial Engineering

An integral component of the financial engineering degree is an internship opportunity that allows candidates to examine specific applications of derivative instruments and risk management in a business environment. Depending upon student and sponsor needs, internships can be structured on a full- or part-time basis. The internship is not a requirement, but is optional and may be taken for academic credit toward the management electives requirement.