Why does everyone think banking is mindless?

Hahaha...because as an analyst you will very rarely be doing anything BUT mindless crap...but will most likely still find a way to walk around and act like you are the next Moelis. There are always exceptions but at a BB this will almost certainly be the case. The perception of glamour and prestige that was created a long time ago in order to draw Harvard grads into entrepreneurial cutting edge firms, still hasn't faded even though all those same Ivy grads are just fighting and clawing to pack into what will most likely be a soul crushing/brainwashing experience, like sardines.

If you work at a BB the formats are already built, you are just plugging in numbers. Please tell me at an analyst level what requires cognitive though on a valuation? Everything is a formula except maybe creating the comp set (what I should be doing right now instead of being on this forum), i am not saying analysts are dumb by any means. The fact is you are just not given that much latitude on your valuations at the very junior levels. Anything that has any big of subjectivity will almost certainly be handed down from your higher ups.

Haha oh college students. So bright eyed, bushy tailed, and full of visions of front page deals and big swinging dicks. All of the things you mentioned in your post are things that your FIRM will be doing. 10% of the time, you might get to help. The rest of the time however, you will be doing all of the dogshit that has to happen behind the scenes so stuff that makes the Wall Street Journal can happen. That includes mindless/pointless research, changing the color of an arrow just because your MD doesn't like the color green, or redoing a month of said mindless work in a single night on a VP's whim.

And the modeling. Oh, your model shows a valuation of 7.3x? The client is expecting to see 8.5x at least or we won't win the deal, so you'd better tweak your inputs so it spits out something higher than that.

But keep that idealism going, that's how we get you to sign the offer letter :)

Are you reinventing WACC or CAPM? Didn't think so, ok so you may have to re write a few things and delete some cells, real tough. I am always doing valuations on our portfolio companies and am at the mercy of my bosses, some of the stuff i do requires in depth analysis but it is not my valuations. All my valuations are tweaked a million times by my bosses, i certainly don't come up with growth expectations or days of expected receivables. Quit being a d-bag, you asked a question and you got an answer. I was not being a sarcastic little pric like yourself, so go get some insight and then return with a valid arguement.

So in team meeting discussions of helping the client get through their problem/task, would a very very good ibd analyst ever be able to assist or at least ask constructive questions (even though the md/vp probably already took them into account)? Would this change at a BB versus a boutique?

Keep telling yourself that banking requires anything more than a high school diploma lol

Dude, they are outsourcing banking to India. I have come across a bunch of shops that have all the modeling done over seas. This shit isn't rocket science. Why do you think they take liberal arts graduates for banking positions. If you can figure out excel and sleep only 5 hours a night you will do fine in banking.

Hardest easy job to get

I think there is a lot of cynicism on this forum with regards to an analyst's role. I think the experience can be quite varied from being dull and boring crunching numbers, models and comps for your associate to being in the negotiation room with clients helping them think through the most appropriate offer structure and hedging and financing solutions. Certainly, I was fortunate enough to experience the latter, while the former is part and parcel of every analyst's life cycle at a bulge bracket. I think sometimes as an analyst you have to find ways to add value and not underestimate what a bit of lateral thinking and a fresh perspective can add to a deal. While you are initially expected to just crunch numbers (I'm talking perhaps most of your first and second years) the value of your grasp over the detail is generally never underestimated by the MD and / or the client. When you're in the drawing room with the client and you ask a smart question, that can sometimes be the trigger to initiate a discussion between the MD and the client, potentially resulting in a solution. Being the junior guy, you have the advantage of being able to ask a question without looking like you don't know what you're doing. Your VP or MD may not have the same luxury.

i call troll.

this thread is great prep for the question: "why do you want to do trading instead of banking?"

The why banking is the hardest question in the world. You have to be able to lie through your teeth, with a straight face, while both people know it is for the money.

It's fascinating how many users with "Prospective Monkey" (aka college student) next to their names are so totally deluded that they feel the need to come in here and tell older, experienced guys that we're wrong about what it's like to be an analyst.

C'mon guys. I know you're all excited to major in finance, go work at Goldman Sachs, and be a master of the universe at 22, but sorry, you've got to pay your dues first. Everyone's a bitch for a while before they make you king.

then why do all the top hedge funds doing distressed debt, long/short credit, long short equity, event driven strats (merger arb, cap structure arb) etc have PMs and analysts that come from IBD backgrounds if all IBD analysts do work that is so trivial...

Penn's got a great perspective that I think, while it may be slightly optimistic, is true for anyone who is looking to go into banking.

Why wouldn't bankers be good fits for hedge funds? Those types of hedge funds require a lot of research and analysis that bankers have good skillsets for. I know plenty of bankers who ended up going to hedge funds, and my opinion is that the intuition and familiarity that you build in banking is what makes you a good fit, as long as you have in interest in investing.

Look, this is the third time I have proposed this. I need some damn backers for it. I want to start an Ibank and only hire high school grades with excel certifications, pay them 40k a year and treat them like chinese counterfeit shoe makers.

Banking is mindless. We just use people like you to convince other's it's not so we can justify getting all that $$$

In a nutshell: you are just toggling the numbers to match the valuation that the MD has decided on long before you fired up your Excel.

Whilst I agree with your point that the work being done is actually often very interesting (i.e. Advising massive corporations on their capital structure), as most people have explained you don't come anywhere near this sort of decision making at the analyst level- and you rarely build models from scratch either.

afroman23

Agree with CaptK, everyone is a slave for a while until you earn respect and show everyone you really want to learn and add value. Also agree with Ivoteforthatguy, your bosses know what they want and you need to get there....Let me be the first to let any prospective monkey know that arrogance is the first thing that will destroy your career, and listen to senior guys (I am not senior) because they know their stuff. I better alt tab on outta here before my boss pops in...

I think the problem lies in the glorification of the job by the banks themselves, which is necessary for them because they need a way to lure fresh bodies into the grinder each year. At the end of the day, it is a sales job, but sales doesn't sound 'sophisticated' and that's why bankers try to make it sound as if you will be shaping the economy or some crap like that. In reality, your boss is an agent who gets paid well because he is able to extract a small fee from a high-value transaction, and you are the support that prepares marketing aids that will help your boss win the deal against other salesmen. You are not a decision maker, but neither is your boss - you are there just to facilitate events.

that's why I work in a boutique

I'm a current banker, and my two other banking friends warned me best: "A dog could learn to do my job in 8 hours." Its mindless work. Your MD isn't gonna BURST into your cube and say OMG aceofspadestrader PLEEEAASE help me sell this billion dollar company! If you can't then we're DOOMED!

Hell, analysts don't add value either. We punch in numbers into excel and make powerpoints look pretty. We're just doing our best to make the seniors' lives easier.

that's why I want to work at a boutique

Its more about detail orientation, work ethic, and being proactive than raw intellect.

well people like to hire banking analysts because a) getting into banking is pretty hard so they worked hard at school and likely had good GPAs b) they may be dorks, but many of them are very smart dorks and can be taught basic human interaction skills later on c) great work ethic and basic knowledge of finance/accounting/excel d)many of them are sooo happy to be out of banking ;)

Analyst program is a very tough experience but ex analysts from top banks are very good people to hire

There is no correct answer in banking. The correct answer is what the buyer is willing to pay.

The OP's rant about building different models for different banks made me laugh. What a fucking bafoon.

That being said, it doesn't mean being an analyst is not challenging. When your MD tells you and your VP to do whatever you can to bring the comps and precedents' valuation range down in a defensible manner (which no one will ever check, but it can't be complete nonsense) - at 10 PM when the meeting's at 9 AM the following day, and you have do another screen with various criteria for precedents, then center on a set of 10 and then have to fully spread each for LTM and P.F. shit and have it all BE RIGHT to the tee - and add to that that you just got sick with the swine flu going around preying on people with fucked up immune systems b/c they don't get enough nutrients / sleep / exercise in their lives, and you got the fever so bad you can make scrambled eggs on your forehead, but you can't go home, and it's midnight already ------------ this is where your value as an analyst actually comes in handy. It's not easy. But for fuck's sake don't ever, ever, ever think you'll be adding value to your client. They can easily reschedule that 9 AM meeting while you're in this semi-conscious psychological limbo reveling in the fact that you're an awesome analyst with the world at your feet.

Yeah, every shop has analysts in India. Pretty soon there won't be a need for analysts, just a couple of guys consolidating information into PPT slides without doing any work. Come to think of it, they'll probably outsource that too.