Career Development

Investment Banker Job Description: Salary, Duties, & More

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Investment bankers work for brokerage firms, banks, and other financial institutions. They help companies and individuals raise money through securities offerings. They also advise companies on mergers and acquisitions, and on how to best manage their money.

Investment bankers research markets, make recommendations to clients, and advise on financial strategy. They are known as “rainmakers” for their ability to bring in money for their employers.

Investment bankers are often divided into industry groups that focus on specific segments of the market, such as health care, technology, or retail. They analyze the performance of these industries and develop strategies for investment. Investment bankers then match investors with appropriate securities.

Investment Banker Job Duties

Investment bankers have a wide range of responsibilities, including:

  • Drafting and negotiating investment terms on new transactions
  • Preparing presentations to present to clients on potential investments
  • Managing existing accounts with clients by performing actions such as profit/loss analysis, monitoring financial statements, and preparing quarterly updates for clients
  • Managing relationships with key clients or clients of different businesses
  • Exploring the possibility of new business opportunities in the form of mergers or acquisitions
  • Identifying potential conflicts of interest
  • Forecasting the potential return of the company’s investments based on current market trends

Investment Banker Salary & Outlook

The U.S. Bureau of Labour Statistics reports that, as of May 2020, the median annual wage for investment bankers is $83,660. Those earning higher wages tend to work in securities, commodities, and financial services firms.

The field is expected to grow 5% between 2019-2029. Investment bankers will be needed to evaluate investment opportunities when new businesses are established or existing businesses expand. In addition, emerging markets throughout the world are providing new investment opportunities, which require expertise in geographic regions where those markets are located.

Investment Banker Job Requirements

Investment bankers need a combination of education, training and experience to be successful. Here are some of the key requirements for this role:

Education

Most investment bankers need at least a bachelor’s degree. Some of the most common majors include finance, economics, accounting, and business administration. Many also get a master’s degree in business or finance to improve their skillset. Earning a master’s degree can also make you a more attractive candidate for promotion.

Training

In most cases, investment bankers get the training they need through their education. Most also undergo a period of on-the-job training after they start at a firm to learn the firm’s specific processes and procedures.

Certifications

While not required, some employers prefer that their employees earn certification from professional organizations such as the CFA Institute.

Investment Banker Skills

In addition to education and other requirements, candidates that possess the following skills may be able to perform more successfully in the job:

Analytical skills: Employees must have strong analytical, numerical, and spreadsheet skills.

Strong work ethic: The investment banking role requires commitment, dedication, and high energy.

Interpersonal skills: Candidates must have excellent communication and interpersonal skills.

Confidence: The job requires individuals to have self-confidence and an ability to make difficult decisions, usually while under a deadline.

Finance knowledge: They must have a thorough understanding of finance, economics, accounting, and other related fields.

Dedication: Investment banking is a highly competitive field that demands long hours from its employees. Candidates who are not dedicated will burn out quickly in this profession.

Investment Banker Work Environment

Investment bankers typically work in offices, but may also work at home or on the road. Investment bankers work with a variety of people, including other investment bankers, company executives, government officials, and business leaders.

This is a competitive industry, and there are limited opportunities for advancement. Those who want to be successful should be willing to work hard and maintain a high level of performance.

Investment Banker Career Advancement

As investment bankers gain more experience, they can begin to transition into a number of other roles that are both higher level and higher-paying. For example, an investment banker may become a senior investment banker, a vice president, a managing director, a partner in a private wealth management firm, or a portfolio manager.

In order to advance within this field, you should hone your communication skills, display leadership abilities, and take advantage of any networking opportunities you have. When you’re ready for a promotion, you may have to relocate to a new city. This is a common occurrence in the investment banking industry. You’ll have to work hard to gain respect from your colleagues and clients, but the increased compensation will be worth it.

Investment Banker Trends

Here are three trends influencing how investment bankers work. Investment bankers will need to stay up-to-date on these developments to keep their skills relevant and maintain a competitive advantage in the workplace.

More Collaboration Between Institutions

In the coming years, we will see a lot more collaboration between banks and financial institutions as they become increasingly interconnected. This trend is likely to intensify as the finance industry continues to become more globally integrated, with countries like China and India on track to become major players in the finance industry.

New Focus on Big Data

New technology, including cloud computing and machine learning, are opening up new opportunities for investment bankers to crunch big data in order to create value for clients.

Many Wall Street firms have begun investing heavily in technology that allows them to run larger datasets through algorithms to identify market trends, while still keeping private any sensitive information.

This emerging trend will require the industry’s future leaders to have an understanding of how big data can be used effectively in finance.

Growth of Impact Investing

Impact investing is one of the most recent trends in the investment banking industry, and one that is expected to grow rapidly in coming years.

Impact investing involves seeking financial returns while also investing in initiatives that benefit society, such as social businesses or environmental causes.

According to a report by Goldman Sachs, impact investing currently accounts for $3 trillion worldwide, but this figure is expected to double by 2025 due to growing interest among investors.

How to Become an Investment Banker

1. Planning Your Career Path

A successful career in investment banking requires intelligence, diligence, and a willingness to work long hours. If you possess these traits, you will be able to secure a rewarding job and position yourself for a successful future. However, you will also need to take some time to decide which type of investment banking job is right for you. Do you want to work for a bank or in an independent capacity? Do you want to specialize in a specific area of the industry? These are all questions that you will need to answer as you embark on your journey to becoming an investment banker.

2. Writing a Resume

The most effective resumes for investment bankers are designed to demonstrate your analytical skills and how you can make an impact. One of the best ways to do this is to show a history of consistently making profitable investments and executing deals that benefit the company.

If you are just starting out in the industry, you may want to focus on more junior positions where you were able to develop and grow a new product or service. These are great opportunities to highlight your analytical skills as well as your leadership capabilities.

3. Applying for Jobs

Getting a job in investment banking is a competitive process. Your best bet is to use your network. When you know someone at a bank, ask them to send your resume to their hiring manager. You can also use LinkedIn to find bankers in your network and ask them to help you.

4. Ace the Interview

Make sure you know about the company, its products and services, and that you are familiar with its competitors. This is your chance to ask questions that will show the interviewer how well-prepared you are for this job.

During the interview, remember to stay focused on answering all of the questions as completely as possible. Avoid giving one-word answers; provide detailed responses so that it is clear you have put a lot of thought into this position. It is also important to maintain eye contact with your interviewer throughout the entire interview; looking away may make it seem like you are lying or hiding something from them. Also, be prepared for some behavioral questions; these types of questions will help determine if you will fit in well with a group at work.

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