A quantitative analyst is a person who works in the financial markets developing mathematical models to assist the activities of traders and risk managers within banks and other large corporate institutes. Throughout the industry, such professionals are known as quants.
Historically quants often had a background in physics, usually to PhD level. However the rapid growth of the derivatives industry and increasing sophistication in use of stochastic calculus to model the markets, led to specialized Masters and PhD courses in mathematical finance to be created. In recent times a large proportion of new quants have completed these courses, often sponsored by private institutions.
Although the original "quants" were concerned with risk management and derivatives pricing, its meaning has expanded over time to include those carrying out statistical arbitrage.