Observers see a continued demand for risk management expertise on Wall Street's buy side, especially among hedge funds.
Barry Schachter, publisher of the Web site GloriaMundi.org, which publishes research for risk managers, sees "an explosion in demand for independent risk management." Richard Meyers, chief executive of Richard Meyers & Associates, a New Jersey-based recruiter specializing in risk positions in financial companies, says he's "never seen such a volume of opportunities at all levels, from the entry-level analyst, all the way up."
Among other things pressing demand is a higher awareness among chief executives of risk issues, says Meyers. "Risk management has become a major activity of the company," he says. "It hits finance, it hits compliance, and its impact is tremendous." For his part, Schachter increasingly sees risk management activities being "carved out" from trading desks or senior management operations, where they've resided until now. Hedge funds, he says, are seeking to position risk management in ways that are more independent from the trading side their business.
Generally speaking, funds seek risk professionals with solid quantitative skills. While Schachter sees much demand for Ph.Ds in quant fields such as mathematics, statistics and physics, he's also noted "a lot of demand" for people who have the quant skills, but not the Ph.D.
Schachter defines risk-management as any function focused on business-related risk, including market risk, credit risk and liquidity risk. "You need to have a broad definition because the job functions are varied," he says. In addition, how a particular fund approaches risk management varies widely, often depending on the approach of the senior risk executive, whatever his or her title might be.
To take full advantage of the sector's strength, Meyers believes risk professionals must be more than technocrats. What many people, even executives, don't realize, he says, is that "the technical skills that got them to their place today will not get them to where they need to be tomorrow." To rise in an organization, professionals need skills in finance, writing, presentation and negotiation. Simply put: "They need to be good business executives," he says.