Financial services firm Merrill Lynch and Co. has pledged $20 million to Massachusetts Institute of Technology over five years to expand studies in the use of technology in finance.

The gift includes two components: a $15 million joint research initiative that will fund collaborative projects in financial engineering and technology innovation and management; and a $5 million gift to help MIT establish a new graduate minor in financial technology.

"The initiative anticipates and addresses a growing need within the financial services industry for sophisticated graduates schooled in a broad, multi-disciplinary curriculum and for focused research on key financial-services issues," said Herbert M. Allison Jr., president and chief executive officer of Merrill Lynch.

MIT's Sloan School of Management, the School of Engineering, the School of Architecture and Planning and six laboratories at the university will be involved in the initiative.

The Laboratory for Financial Engineering, housed at the Sloan School of Management, will launch a series of new research initiatives in electronic commerce, risk management, data mining and computational finance, MIT reports.

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