How common are Python/VBA/R/SQL skills?
Hi,
In IB/PE/HF (non quant), what percentage of the incoming analysts have coding skills? I'm curious to see where this arms race among analysts is going. If you know how to code, what do you use it for?
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Just a prospect, but I've held some boutique IB internships. You will never use these languages, and if anything it would just be helpful to show that you're "smart" (i.e. if you minor in compsci and major in econ but have a 3.98). Also, if anything it's helpful to understand the logic behind the languages just so you can use Excel without having everything #REF. In other words, you'll only ever use Excel and PowerPoint for IB. Similar for PE, you won't need coding.
Thanks! Would there never be a use case for web scraping or building models? And what about for HFs?
I don't know enough about HFs but I can speak out of my butt if you'd like.
No to the web scraping and models. Maybe in 20-30 years there will be a case for it, in the same way that 20-30 years ago people would've laughed at you for saying that you'd need coding skills for trading. Currently everything is done in Excel and Powerpoint - if you want to become a top-tier analyst then you should become EXTREMELY skilled at these + the technicals so you can quickly churn out work. IB is really just a glorified presentation creating job, but it's extremely competitive and it pays well because of the talent it attracts + the necessary people skills.
HFs are a different ballgame. It'll be good to get coding skills because the job is getting progressively more automated as the years go on. If you're talking non-quant then a strong understanding of the fundamentals will be necessary, but who do you think is coding the programs they use to trade? Even traders in S&T are getting phased out by "salestraders" and quants. Slowly I could see it becoming a one-size-fits-all job, where traders do sales & quant work. Or traders will get phased out and it'll all be quants & salesmen. Or, there will be no need for sales and everyone (including institutional investors) trade on an app on their phone, so it'll be all quants.
Also, depends on what role you want in HFs. Even quant hedge funds need researchers, but it sounds to me like you want the trading side of the job. Also researchers are progressively learning to code, so why wouldn't they start being traders in 5-10 years?
The trading industry as a whole is becoming automated. If you want to go the HF route then learn to code, simple as that. If you don't need it then great, but if you do then you'll be screwed without it. Finance isn't extremely hard - it's not like physics where you're trying to figure out the precise angle and speed you need to exit Earth's atmosphere without shredding a rocket to pieces - it takes more passion than anything to learn finance. In the past, the finance world was different and it was all relationship driven + it took tons of footwork. Now it's relationship driven and it's getting automated. Soon enough it might be all automated for some roles. IB and PE are different because you need to make deals so there will always be a people component, but the precise structure of the deals (what % equity and debt, etc.) could be figured out with computers. Fortunately that will be long after I'm retired, so I dont have to worry about that.
just an intern but tbh man it's going to be very different for ib and s&t. ib is mainly excel, powerpoint and vba if you're trying to stand out while posters on this forum say python is a necessity for s&t so it's really not a one size fits all.
CS major who's starting a ft banking job in a few weeks -
When you ask these questions, think about why they might be useful. I'd say that Python and VBA are likely the most obviously useful, if anything because, once you're good at them, you can use them to automate repetitive tasks. For example, let's say every day you need to pull data from some source without an existing excel API (i.e., not CapIQ / FactSet / etc.) and update a spreadsheet. If you know your way around Python and the data is structured enough, you could automate that. Python also makes basic data science really easy (easier than Excel, imo), but it's doubtful you'll have to do anything beyond a regression in banking.
SQL and R likely won't be nearly as useful for banking in particular. SQL requires you to have an SQL database to query against; doubtful you'll encounter that. R, no way you're doing statistics difficult enough to require R.
Of course, these answers are very banking specific. For example, if you exit into industry (in some sort of strategy, corp dev, finance, business analytics, etc.) role, then SQL will likley be useful insofar as the firm likely has internal databases that you'll want to draw from to help support some project you're working on.
I would wager that generally, once you're in a role where you're responsible for coming up with ideas (investment thesis, strategic moves, etc.), then the more tools you have at your disposal to help inform those ideas the better. However, they will only ever be that: tools. Unless you become a product manager / data scientist / etc., your job will never hinge on you knowing Python / SQL / VBA / R / etc. They'll be as useful as you make them.
Thank you! How would you tweak your answer for HF? And why did you go banking, out of curiosity?
No need to tweak the above answer.
Fundamental HFs carry the same "corporate" skillset that i-banking does: ppt/xls/word/outlook. You're going to be digging into financials, running financial models in excel, reading industry reports, writing up research notes, speaking to management teams and building up a case to pitch to your PM.
Scripting languages only come into this insofar as a) to speed up slow manual processes or b) using data to back up your assumptions about some aspect of a company's business model and/or future.
People are really overhyping the need for programming languages in "corporate" style jobs. You really don't need them at all to do these jobs. What you need are critical thinking skills, communication skills, presentation ability/polish, some basic numeracy and a good attitude. If you want to flex your programming model stay away from corporate style jobs and go do SWE or Data Science/Analytics or Quant Finance...
-\ signed: CS major
I'm a student and I've been interested in IB for a while and I prefer Python far more compared to Excel, the dataframes are easier to manipulate, and although they may not seem easy to go in and mess around with after you're done modeling, a library called D-Tale makes it pretty easy to do that too. Do you think that in the future IB will transition to Python or that more people will use it to crunch out models as it's a lot easier on Python? I feel like you could just model on Python and convert it to excel and format it however you need to. Would there be anything stopping me from doing this in the future?
IB is fundamentally a relationship business. Technical skills are definitely needed but not to the level of needing a programming language. It will be more efficient to hire dedicated software engineers to do these kind of automation rather than have bankers do it (and many banks do, ex: GS have IBD Strats etc). Also Excel is quite good at what it does. It is much better at showing and modifying the intermediate values in the calculation process than python. In fact the core risk frameworks at the likes of GS/BAML/JPM are all fundamentally Excel-like. Excel only becomes an issue if you have a ton of data which isn't a problem for the IB models.
I think this is important if you are doing something in the field of design
Joining a top LO AM next year, have been told knowing Python is very very helpful for understanding risk metrics and overall portfolio management.
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