New to Forums with questions
Hey guys, I'm new to this forum. I'm currently a high school senior headed for Chicago next year as a math major. I wanted to explore this career field because I hear many of my high school classmates strongly considering it during/after college.
First off, I'd like to know what specifically investment bankers do? I'm thinking they buy/sell some type of stock or security? I'm really not sure at all and I get the feeling that many of my friends don't either. I currently work at an Accounting firm and though the pay is good, numbers crunching seems to be the most boring job in the world. I'm mainly considering I-banking because my parents are getting a bit old and I need some lucrative job to support them after college. I apologize if I'm coming off as someone not interested in the field, but financial burdens will be the priorities in a few years.
Thanks for all the information and give me any advice you can.
that is totally understandable, and i feel for you; fortunately, my parents are in a stable situation, but there was a time at which i thought the same thing (probably around your age)
alot of ppl do banking for the "wrong" reasons; that's one "wrong" reason that i will never discount. the good news is that it is lucrative, and you should have NO problems helping out your parents on the salary you will make; alot of ppl will disagree, but alot of these ppl may not come from the same background i am assuming you come from; also, if family support is a constraint, then i imagine you will exercise personal financial discipline (ie not go out and waste $500 on a bottle at marquee, it gets old really quick anyway)
to your original question, this is something you can easily find with a wiki search, or even a search on this forum, but i will give you a quick description; investment banking is basically servicing companies with their strategic and financial needs; namely including (but not exclusively): mergers and acquisitions (if a company wants to buy or sell another company); equity/debt financing (when a company needs funding, depending on the type of funding it needs); restructuring (can be m&a for companies that are near bankruptcy, or a multitude of other things involving companies in this broad category)
at the junior level, you learn how to model out alot of these different types of transactions, as well as create the associated presentation material that goes with selling and executing these types of deals. all said, you will probably learn more in your two years of banking than you will in all four years of college, and then some. also, you are well prepared to enter most areas of business after finishing a two year program at a decent sized bank; if taking care of family and making sure you have enough money to do so is your goal, then you can easily acheive this, and much moreso, by working at a hedge fund or private equity group afterwards.
hope this helps!
Wow thank you very much for the information. I had a couple of more questions concerning placement to these programs. Does one wait until the senior year in college to seek positions, or is important to do internships and the sort for resume padding and experience? Also, how does the University of Chicago do in investment banking placement. I'm going for the strength in academics and the amazing opportunities in the Economics department, but any good job placement is always a plus. What are some tips for me as a freshman in college concerning GPA and extracurriculars?
Thanks very much this is all appreciated.
i mean, it's a top tier school, and you should have no problem with access to the best banks, as well as top hedge funds (especially at u of c, where there is more of an emphasis placed on "quantitative" finance, both in the corporate finance sense, as well as in the more statistical/mathematical/traditional quant sense). if maximizing income is your goal, i would go with one of these HFs, if it's an established one (ie Citadel for instance).
you should always try to keep your gpa up, that is a given; that said, there are almost ALWAYS mitigants if it is lower. also, just join extracurriculars that you are interested in; i think the biggest thing in banking interviews is just to show that you are not one-dimensional; for more quant/trading/other types of positions, it's not as relevant
also, just figure out early on what area of finance you want to go for; investment banking is just one, there are all kinds of other things you can do, from cdo trading, to global/macro investing (at a hf or something); you really should try to read up and see where your interests would lead you
To answer (roughly) your questions: -Internships are very important, you probably won't be able to get an IB internship until your final summer, but any finance-related internships before that will be helpful.
-Chicago: I'm not that familiar at the UG level, but I know their b-school is top-notch for IB placement, so I'm sure they are decent. -GPA: 3.5 or above. -ECs: yeah do those, show leadership/commitment as much as possible. i.e. don't just join 20 clubs/teams, join 2-3 and make them a demonstrably significant part of your life.
Also, wallstreetguy gave a great overview of Investment Banking. You should also look into Sales & Trading, which is a completely different job (though equally lucrative/prestigious). Traders buy/sell securities. Check out the Traders Train forum for more info.
That may be a little difficult at Chicago!
GPA is all relative though. Just try to stay in the top quarter or so of your class.
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