As a college student, I am very interested in IB but I am curious is there actual investing that a banker will be involved in. If not why is it called a investment banker, why not transaction banker?
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Understood - so investment bankers are really also kind of non-discretionary portfolio managers for their clients. So when I am asked in an interview why IB, can I say "I have always been interested in the non-discretionary portfolio management process for corporate clients and I am interested in helping them realize an attractive return on purchased assets"
Why are investment bankers called investment bankers when they are neither investors nor bankers? Good question.
The name is confusing because when we think of banks, we think of retail banks like Wells Fargo or Revolut where we put our money in them. But for investment banks it's different.
Consider the following:
What's a blood bank? An intermediary (middle man) for blood
What's a question bank? An intermediary (middleman) for exam questions
Sperm bank? A middleman for sperm
Food bank? A middleman for food
So what are investment banks? They're a middleman for, you guessed it, investments.
Investment bankers don't invest money (like portfolio managers) nor deposit money (like retail bankers). Instead, they work as intermediaries for investors (e.g., PE firms) and companies (e.g., a company that wants to IPO) and facilitate those transactions.
Username checks out. Ya did well sonny, ya did well.
Great answer, I understand now. Will use this in my "Why IB"
Not sure what you mean by using this for your “Why IB”, but if you plan to regurgitate the concept of banking for your reasoning to pursue this career, you should take a step back.
I highly encourage you to learn more about the actual role and select one / a few key responsibilities that you would carry out as a banker that excites you (or at least seems exciting).
Uhh, how on earth do you plan to answer 'What is IB' to 'Why IB'?
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