I get many mails from readers asking - "How to become an investment banker?"
No wonder that Investment banking has become one of the most lucrative and preferred careers options for finance aspirants around the world.
The profiles offered within this domain have their own aura and command respect in the finance arena.
In this article I will tell you a few things that will bring you closer to realizing your dream of becoming an investment banker.
Become an Investment Banker
Step #1: Take up finance as your major in college
Your journey as an investment banker starts with taking up finance as a major in your graduation / post - graduation course.
This is the first step wherein you will be groomed in the college to take up a career in investment banking.
In addition to the core subjects, colleges will also present you with the opportunity to interact with the industry for better learning.
Take your course curriculum and assignment seriously and learn as much as you can during this time period.
Step #2: Look for vocational courses for getting expertise
If you have already graduated and still think that you do not possess the skills or expertise to start as an investment banker, there are a bunch of vocational courses for you to take up.
There are distance learning, online and correspondence courses for aspirants like you to acquire investment banking knowledge and skills.
With a little bit of research you will be able to find many institutes that offer these courses.
Step #3: Look for internships
I have always maintained that finding internships is the best way to get started in your career.
There are investment banks that offer internships all year round for aspirants like you.
After the end of your internship, depending on your performance you will be confirmed as a full time employee or you could also get an extension as an intern if there is still scope for improvement.
Step #4: Networking
Get in touch with your college alumni or friends who are working in investment banks to ask for an opportunity.
More often than not, knowing someone in an investment bank improves your chances of getting a shot at the interview.
If there is no one working in investment banks that you know, you can always rely on social networking.
A detailed search on LinkedIn might prove fruitful in this case and may help you speed up the process of getting to an interview.
Step #5: Prepare for the interview
Once you have an interview at hand, start preparing for it.
In addition to preparation related to the finance subjects you should also go through the website of the company and know what all they do.
It usually helps during the interview if you already know what work company does, their clients, workforce, Vision and Mission statements etc.
It gives a positive image of you stating you are genuinely interested in the job and have done your preparations for it.
Investment Banker Job Description
Now that I have told you how to get the basic preparation done for getting an investment banking job, let me tell you what all will be expected of you in terms of skill sets and what all profiles you will get to work in.
Let me start off with the profiles:
1. Corporate finance
In this profile, you will be required to apply your financial knowledge to practice. Right from raising new funds to allocation of funds and monitoring progress, you will be required to assist your clients by doing financial analysis.
This is an esteemed profile within investment banking and usually takes into account your experience while hiring.
2. Mergers and acquisitions
In this profile, you will be assisting your clients on major financial deals usually involving big sums of money either taking over a company or buying a stake in another company.
You would be required to provide assistance on valuation, facilitation and execution of the deal.
Typically, this profile requires a lot of ground work to be done and involves long working hours.
In this profile you will be responsible for undertaking transactions on behalf of the clients.
This is one of the few profiles in investment banking that requires a lot of communication both internal and external in day to day operations.
The growth in this profile is faster when compared to other profiles given your performance is consistent and reflects growth in numbers on a regular basis.
4. Equity research
Either on behalf of the client, or for your own company, you will be required to deal with capital markets in this profile.
Your knowledge and understanding of stock markets will be of utmost importance in this profile.
This can be for both buy side and sell side of the horizon.
In each case you will have to be abreast with the volatility and sensitivity of the stock markets on a day to day basis.
Now let us talk a bit about the skills required to perform as an investment banker:
1. Data Collection
You need to have primary and secondary data collection skills so as to work efficiently as an investment banker.
Usually the data required is easily available on the Internet, but at times you will have to fight hard to get the right data for your work, and therefore primary data collection skills are required.
2. Data Analysis
Once the data is collected, the most important job of an investment banker is to derive insights from those numbers.
There is a saying that numbers usually don’t speak for themselves, but as an investment banker your job is to make those numbers speak! Your knowledge of financial tools and financial modeling has a crucial role to play.
3. Report writing
As against the typical myth that investment bankers don’t know anything beyond numbers, the work involves creating long reports with a lot of qualitative information too.
Many a times you will be required to create presentations of the findings from your data analysis.
When you move up the hierarchy, you will also be required to make the presentations in front of the client, which requires a good deal of communications skills.
Hope this article gives you clarity on how to become an investment banker.
Now I've Got a Question For You…
How do you plan on using this article for your career?
I’m sure you can see the potential this post has to improve your career. It’s just a matter of applying the techniques to your career.
So I’d love to hear what you have to say.
Leave a comment below to let me know what you think.
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