A “quant” is one who works in quantitative finance, which is mostly concerned with developing models for analysing financial derivatives.

I had an obvious interest in the book from the moment I read about it, given my closeness (ehm) to the industry and one the firms discussed in the book. And while I was never a quant myself (lacking the requisite PhD in quantum physics) I have worked closely enough with quants to be interested in hearing what an insider might have to say about life as a quant.

Given the numerous 5-star reviews the book got, I was sorely disappointed with it.

The book really does not live up to any of the promises of its title. Firstly, Derman’s life as a quant takes up no more than half the book – the first half is about his life in the world of academic physics (first during his PhD and then his seemingly endless wanderings from one postdoc position to another) and later in Bell Labs. Secondly, and more importantly, the promised “reflections” are nowhere to be found.

This book is a plain and simple auto-biography, written by a brilliant (as far as I can judge) scientist who nevertheless has nothing particularly brilliant to say about his life. Derman simply goes through his life from when he finishes his undergraduate degree, methodically and linearly, almost year by year. This might work if he had led a particularly interesting life, or was able to write very engagingly about the ordinary things in his life, but Derman isn’t that good a writer.

I see this simple chronological approach as a symptom of a bigger problem: Derman has no particular aim with this book, no theme. There are no reflections, no insights, no trends or discussions of how things have changed, no conclusions from important events. He could have written about the birth of financial engineering, or the daily life of a quant, or the differences between academic life and Wall Street… but he doesn’t.

Instead, he spends a lot of time complaining about his career, its hopelessness and aimlessness and loneliness, and how unhappy he was with most of his jobs (especially the one at Bell Labs).

And when Derman isn’t talking about the difficulties of finding a career, he indulges in endless name-dropping, which really got on my nerves. Every colleague whose name readers might recognise is mentioned (especially all the famous physicists), as well as more tenuous connections, including people he met only once for a failed job interview. Or never met at all, for that matter:

We learned database theory from David Shaw, who later founded the investment boutique D.E.Shaw & Co., as well as the first free email service, Juno. At D.E.Shaw, David employed Jeff Bezos, who later left to found Amazon.com.

“Look at me! I once knew someone who later knew Jeff Bezos!”

The amount of ink spent on talking about Important People doesn’t decrease when Derman talks about his life as a quant. He seems to be almost obsessed with Fischer Black. Yes, I know, Black was an important guy, and made important discoveries, but still… Even in chapters where Derman is neither working with Fischer Black, nor hoping to work with Fischer Black, nor talking about how Fischer Black would have done things, he suddenly, out of the blue, makes comments such as this one (“it” being the Risk magazine):

Fischer, too, commented admiringly on it.

I am still wondering why Derman wrote this book.

I guess “My Life as a Quant” may appeal to readers who have followed a very similar career path and recognise all these names. Or perhaps to those who know the physics world but not the quant world – but the book isn’t focused enough to give those readers any real understanding of quantitative finance. Perhaps it can be inspirational for wannabe quants, of whom there is no shortage, I’m sure.