Investment Banking Exit Opportunities: The Myth Of The Buy-Side Job

Investment Banking Development

Banking Investment / March 15, 2014




I-banking is the term used to describe the business of raising capital for companies. Capital in this sense means cash or money. When firms need cash in order to grow and expand their businesses, I-banks sell securities to public investors to raise this cash. Investment banks may work with corporations, governments, institutional investors and/or extraordinarily wealthy individuals to raise capital and provide investment advice.

2. What are the skills necessary to have a successful career in Investment Banking?

  • Analytical and quantitative ability
  • Competitive nature
  • Interpersonal
  • Creative ability
  • Communication
  • Ability to synthesize information quickly
  • Sales abilities
  • Initiative
  • Teamwork

3. What are the different sectors within the Investment Banking industry?

Corporate Finance: Financial consulting to businesses. Specific activities range from underwriting the sale of equity or debt for a corporate client to providing advice on mergers and acquisitions, foreign exchange, economic and market trends, and specific financial strategies.

Security Sales and Trading: An investment bank relies on its sales department to sell bonds or shares of stock in companies it underwrites. Investors who want to buy or sell a certain stock or bond will place an order with a broker or sales representative, who writes the ticket for the order. The trader makes the trade. Securities salespeople and traders are independent, working on commission to bring to market the financial products that others create.

Sales (Brokers or Dealers): The bottom line in sales is how well you can sell new debt and equity issues and how quickly you can translate news events or a market shift into transactions for your clients. These jobs are usually much less hierarchical than the banking side. Your sales volume and asset growth are what matter.

Trading: This is as close to the money as you can get. Trading is considered tougher, riskier, and more intense than any other job in finance. Traders manage the firm’s risk and make markets by setting the prices, based on supply and demand, for the securities Corporate Finance has underwritten. Similar to sales, you are tied to your desk and phones while the markets are open. Traders make money by trading securities. Although they’re the ones who transact trades for the brokers and their clients, traders are primarily responsible for taking a position in a security issue and buying or selling large amounts of stocks or bonds using an employer’s (or their own) capital.