| The first Master of Financial Engineering degree programs were set up in the early 1990s. The earliest financial engineers (under a different name) might have started around in the late 1970s. [Wikipedia - Financial engineering] Mortgages were invented way earlier. ATMs are an earlier invention. If you use todays categories they would have been invented by automation engineers. While index funds are a financial product they were invented before financial engineering became a thing. Financial engineers are not needed to run index funds. They are employed to out perform them. "Financial engineering plays a key role in the customer-driven derivatives business — 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." And i am not alone with my distain. "The financial innovation often associated with financial engineers was mocked by former chairman of the Federal Reserve Paul Volcker in 2009 when he said it was a code word for risky securities, that brought no benefits to society. For most people, he said, the advent of the ATM was more crucial than any asset-backed bond." As for definition of financial engineering, i takes those from http://www.wirtschaftslexikon24.com/d/financial-engineering-... The term financial engineering is also used insofar as it is about the use of innovative financing and risk hedging instruments. In this sense, financial securities are first broken down into their basic elements, e.g. interest, repayment, currency, maturity, security, additional rights (»stripping«) in order to be able to evaluate them (individually) better. Based on this, new, optimal financial titles are created during »Replicating«, in which the modules are optimally combined according to the respective financing case. The concept of financial engineering can be seen in summary as the design, development and implementation of innovative financial instruments and processes as well as the realization of creative, tailor-made solutions for investors and buyers |
Still hard for people not deep in it — me — to see clearly that crypto doesn’t contain the seeds of a better index fund or a cheaper mortgage.