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Career planning - Investment Banking

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Introduction

Investment Banking: Skill and Talent Requirements Investment banks want employees with a combination of strong analytical and interpersonal skills. Some jobs lean more towards one skill set than another (e.g. brokers need to be mainly sales people). A typical job of an equities analyst requires both analytic and interpersonal skills. The skills involved include: Key Skill Area Requirement People skills: High Sales skills: Medium Communication skills: High Analytical skills: High Ability to synthesize: High Creative ability: High Initiative: Medium Work hours: 50-120/week Hard Work Expected and Respected Investment banking is a high work, high risk, and high reward profession. When you start your hours will typically be long but the work can be exciting. Be prepared for moments of frustration where you are stretched too thin and moments of exhilaration where everything clicks. Tough to Break In It's relatively hard to break into investment banking. You need to be prepared to pursue firms on your own after you have thoroughly prepared yourself. Analyst Jobs Are the Best Entry Point Many college graduates start in investment banking in an analyst position. To succeed in these positions you need to be extremely dedicated, have good spreadsheet skills and be analytically fluent. Your next step will be to become an associate. Same skills just raise the volume. ...read more.

Middle

Sometimes jobs in corporate finance are referred to as investment banking positions. Capital Markets This position can be either in Debt Capital Markets or Equity Capital Markets (ECM). Debt Capital Markets (DCM) is often broken down into high yield bonds and investment grade bonds. Sometimes, there are separate desks for origination of sovereign, supranational or municipal bonds. Capital markets officers help companies originate new issues of debt or equity. They get calls from bankers who have clients who are interested in issuing. They then look at market conditions; perhaps tracking swap spreads across the interest rate curve using a Bloomberg terminal and advises as to the right time and form of issuance. Mergers and Acquisitions Setting up deals where one company buys another is an important source of fee income for many investment banks. When this area is hot on Wall Street, it can be hugely profitable. But even when capital markets conditions make it difficult for companies to finance acquisitions, as they did in the 2008/09 recession, strategic mergers continue to happen and banks that specialize in M&A continue to do deals, albeit at a lower volume. If you go to work in this area you would help out with a team which acts as an advisor to a client, values transactions, creatively structures deals and negotiates favourable terms. ...read more.

Conclusion

This is a tough business to get started in (especially if you are much younger than your clients), but the rewards to a good people person with great sales skills are high. Many brokers earn upwards of $500,000. Institutional Sales In institutional sales you would be responsible for conveying information about particular securities to institutional investors. You would be likely to have heavy contact with portfolio managers and your own firm's analysts and traders. Sales skills and product knowledge are crucial in this area as is the ability to get through to busy institutional investors. Working in sales for an investment bank (on the sell side) is often good preparation to move over to the buy side (insurance companies and mutual funds). Both types of jobs can be brutal and subject you to abuse. A common Wall Street Joke: What's the difference between a sell side and a buy side player? Answer: On the sell side they curse you only after they hang up the telephone. Taking abuse can be lucrative. The average salaries in institutional sales can exceed $750,000 per annum. Investment Banking: Firm List 1. Bank of America Merrill Lynch 2. Barclays Capital 3. Blackstone Group 4. CIBC 5. Citigroup 6. Credit Suisse 7. Deutsche Bank 8. Evercore Partners 9. Goldman Sachs 10. HSBC 11. JP Morgan 12. Lazard 13. Moelis & Co 14. Morgan Stanley 15. Nikko Securities 16. Nomura 17. Piper Jaffray 18. RBC 19. Torreya Partners 20. W.R. Hambrecht ...read more.

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