Finance may be where the money is, but is this business discipline also where you will find the most math requirements? While minimal math studies are required for all business majors, finance happens to be one of the most quantitative fields. To learn essential skills such as analyzing and assessing investment performance and financial planning for savings goals, you must acquire a solid foundation in mathematics. While you won’t need to learn complex advanced mathematical theories, you will need to develop strong analytical abilities and enough of a background in algebra, calculus and statistics to apply concepts of these math branches to the finance field.
General Education Math Requirements
The first math requirements students will encounter are general education courses. Students pursuing all programs of study must complete these mandatory classes in a diverse range of subjects. Most colleges and universities require only a couple of math classes to fulfill general education requirements. For business majors, courses like the introductory Calculus I or, if offered, a more specialized Business Calculus that focuses on practical application are often the best choices. Depending on your business school and finance programs, you may also take a college-level algebra course. While not always required as a general education course, taking an introductory class in probability and statistics is often a good choice, as well.
RELATED: What Classes Will I Have to Take for a Degree in Business Administration?
What other math-related courses will you take in a finance degree program? Studying asset management, which is an essential part of learning the field of finance, will require you to develop your quantitative analysis skills to learn how to manage different types of investments, including equities, fixed income and derivatives. You may need further studies in traditional math branches such as calculus and matrix algebra to develop the math background needed for these specialized finance courses.
In addition to your general education classes, you must take core business courses, specialized finance courses required for the finance major or concentration and enough elective courses to give you the credits needed to graduate.
How Finance Professionals Use Math
Math is an important part of the financial specialist occupations, but the focus of the math you will do as a finance professional is on practical applications of business concepts, not advanced theory. The United States Bureau of Labor Statistics (BLS) reports that math skills are important for financial analysts, financial examiners, personal financial advisors, budget analysts, cost analysts and many other business and finance careers.
Finance professionals apply math principles to different matters and in different ways. Financial planners must figure out an appropriate amount of money to invest in order to create a strong portfolio and calculate the performance of these investments. For analysts, one of the most math-focused tasks is appraising the value of financial assets. Financial examiners, who make sure banks and other financial institutions comply with regulations about risk and consumer lending practices, have to monitor balance sheets and reserves of available cash, the BLS reported. Cost estimators have to accurately factor all kinds of costs, from supplies to equipment to labor costs, into their calculations. Financial specialists in different job roles need the math and technology skills to use computer software, including database management software, financial analysis software and spreadsheets.
There are benefits of earning a “math-focused” business degree like finance rather than a general business degree, including better income potential and a lower rate of unemployment and underemployment, according to The Washington Post.
The Most Math-Heavy Finance Majors
Not all finance degree programs are equally reliant on math skills. If you choose a specialized finance major such as quantitative finance, you can expect to take a lot more math coursework than you would in a more general finance major. Students of quantitative finance degree programs often complete enough math courses to qualify as a math minor. In addition to the Calculus I and Introduction to Probability and Statistics courses that their peers in other business programs take, these students will likely study Calculus II and III, Linear Algebra with Differential Equations, Applied Linear Regression, Fourier Analysis and Partial Differential Equations and Computers and Numerical Algorithms. Some courses, like securities pricing, mathematical finance and time series analysis, are interdisciplinary in nature, combining math and finance.
A degree in quantitative finance can prepare you for just about any finance role but is especially valuable if you want to work in highly technical career paths like analyst, consultant or financial engineer.
Additional Resources
Is There Any Math Required for a Degree in Business?
Is There Any Math Required for an MBA?
How Much Math Is Required for a Degree in Accounting?