Financial engineering

Fields
The main applications of financial engineering^[1]^[2] are to: Arbitrage Corporate finance Derivatives pricing Execution Financial regulation Portfolio management Risk management Structured products International finance and financial administration Valuation of options

Financial engineering is a multidisciplinary field involving financial theory, methods of engineering, tools of mathematics and the practice of programming.^[3] It has also been defined as the application of technical methods, especially from mathematical finance and computational finance, in the practice of finance.^[4]

Financial engineering plays a key role in a bank's customer-driven derivatives business^[5] — delivering bespoke OTC-contracts and "exotics", and implementing various structured products — which encompasses quantitative modelling, quantitative programming and risk managing financial products in compliance with the regulations and Basel capital/liquidity requirements.

An older use of the term "financial engineering" that is less common today is aggressive restructuring of corporate balance sheets.^{[citation needed]} Mathematical finance is the application of mathematics to finance.^[6] Computational finance and mathematical finance are both subfields of financial engineering.^{[citation needed]} Computational finance is a field in computer science and deals with the data and algorithms that arise in financial modeling.

^ Marek Capiski and Tomasz Zastawniak, Mathematics for Finance: An Introduction to Financial Engineering, Springer (November 25, 2010) 978-0857290816
^ David Ruppert, Statistics and Data Analysis for Financial Engineering, Springer (November 17, 2010) 978-1441977861
^ "MS in Financial Engineering". Columbia University Department of Industrial Engineering and Operations Research. Archived from the original on 2017-01-19. Retrieved 2017-01-18.
^ Tanya S. Beder and Cara M. Marshall, Financial Engineering: The Evolution of a Profession, Wiley (June 7, 2011) 978-0470455814
^ Qu, Dong (2016). Manufacturing and Managing Customer-Driven Derivatives. Wiley. ISBN 978-1-118-63262-8.
^ Cite error: The named reference Dubil was invoked but never defined (see the help page).

[Capiski-1] Marek Capiski and Tomasz Zastawniak, Mathematics for Finance: An Introduction to Financial Engineering, Springer (November 25, 2010) 978-0857290816

[Ruppert-2] David Ruppert, Statistics and Data Analysis for Financial Engineering, Springer (November 17, 2010) 978-1441977861

[IEOR-3] "MS in Financial Engineering". Columbia University Department of Industrial Engineering and Operations Research. Archived from the original on 2017-01-19. Retrieved 2017-01-18.

[Beder-4] Tanya S. Beder and Cara M. Marshall, Financial Engineering: The Evolution of a Profession, Wiley (June 7, 2011) 978-0470455814

[5] Qu, Dong (2016). Manufacturing and Managing Customer-Driven Derivatives. Wiley. ISBN 978-1-118-63262-8.

[Dubil-6] Cite error: The named reference Dubil was invoked but never defined (see the help page).

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