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How to Build a Successful Career in Investment Banking?

No matter what career you pursue, the end goal of it is always to be successful. But what we often fail is to understand what success means in that particular field. It is important to put efforts in the right direction in order to achieve a successful career. Let us know how to build a successful career in investment banking.

What is a career in investment banking?

A career in investment banking is primarily advisory in nature. This involves advising large corporations, governments, and other entities on potential investment opportunities. It is a career with a handsome compensation package as this job profile involves research to get proper insights and handling a large sum of money. You need to have a good grasp of the current financial and investment climate. 

Why choose an investment banking career path? 

A high salary is one of the most attractive aspects of a job in investment banking, and the main reason why most people flock to it. But there are other benefits to choosing an investment banking career

  • High compensation: As mentioned above, this job offers a good package, even at entry-level jobs. As you climb the ladder the rewards only get better which is difficult to be found in other jobs. Salaries of some investment banking job profiles are as follows:
      • Finance Analyst’s average salary: $97,439 per year
      • Investment banker’s average salary: $113,270 per year
      • Associate’s average salary: $148,138 per year
      • Credit manager’s average salary: $72,091 per year
      • Investment banking VP’s average salary: $157,360 per year
  • Variety in work: Even within the finance sector, jobs in investment banking are quite diverse. A variety of skills are used to complete different kinds of jobs, making the job interesting. Some of the skills required in investment banking are as follows: 
      • Financial skills
      • Analytical skills
      • Communication skills
      • Leadership skills
      • Team management skills
      • Time management skills
      • Networking skills
      • Negotiation skills, etc.
  • Choice of industry: Even though you will be working in majorly on finance and investments, you can choose which company or field you want to work in as investments are made by almost all companies.
  • Better connections: Since you work with big companies or the government, the people you interact with are normally very high profile both colleagues and clients. This gives you an opportunity to build connections that can benefit you in your career. This network helps you find new job opportunities or put in a good word for you if you are looking for more work. This helps with building a client base as well. 
  • Larger impact: Investment banking jobs are normally for large companies and as an advisor, you have the privilege to impact these large organizations directly. It is a profession that gives you immense opportunity to do things beyond the individual level.

What is the hierarchy and job progression in investment banking?

Normally, in any field of work, there is a general job progression. You start with an entry-level position and move your way up the ladder. Let us understand the hierarchy in investment banking

  1. Finance Analyst: The general entry-level job is of an analyst. It is important to note that even though it is an entry-level position, the people applying for this job are expected to have an accredited degree from a noteworthy university. Such as an MS in Finance from the George Washington University of Business will help you understand the ins and outs of the job. A program like this gives you practical sights with distinguished faculty. It also qualifies as a STEM (Science, Technology, Engineering, and Mathematics) designated program for Optional Practical Training (OPT) purposes, which allows international students to work for 3 years in the US before transitioning to a work visa.
    While a course such as MS in Applied Finance from George Washington University is much more focused on the applicability aspects and strengthens their student’s grasp on the subject accordingly. In this program, you will learn risk management, financial engineering, banking, corporate finance, and portfolio analysis and management to cement your professional standing in the field. This program as well qualifies as a STEM (Science, Technology, Engineering, and Mathematics) designated program for Optional Practical Training (OPT) purposes, which offers the potential for international students to work in the US for a total of 3 years before transitioning to a work visa (H1-B, etc.)
    Lastly, there is also an option for a Global MS in Finance from the Richard DeVos Graduate School of Management which offers you a deep understanding of global financial markets, and a range of quantitative financial skills. In the program, you learn finance through the practical application of the concepts. You develop broad-based decision-making capabilities that are critical for your career’s success and are immediately applicable to the workplace. Analysts are mostly responsible for compiling data and preparing reports to show potential investment opportunities. Depending on the company, an analyst would be given additional responsibilities.
  2. Finance Associate: After getting 2-3 years of experience as an analyst a person can look forward to getting promoted to the associate level. Someone applying for this job would be responsible for handling a team of analysts. An associate delegates work among their team and reviews their work to ensure necessary standards. Additionally, they give further inputs on prepared reports and presentations, handle client calls, and give updates to senior staff.
  3. Finance Vice president/ Director: If you are performing well at the associate level for at least 4-5 years, you can hope to gain a position such as VP. In this position, you are expected to make important decisions for the company. You directly deal with high-profile clients and are expected to foster a valuable relationship with them. Someone in this position, would not be preparing reports but they are expected to be up to date with the market and make sound analyses based on their knowledge and experience.

There are many other positions available in investment banking, the positions and their job profile can differ based on the company as well. But the general job progression is similar to how it was mentioned above.

A career in investment banking can help you reach executive-level jobs much more quicker than other jobs available in the market. Following the above-mentioned path, with the right education, experience, and hard work; will help you succeed in investment banking

FAQs

  1. What is the difference between corporate banking and investment banking?
    • In corporate banking assistance is given in banking transactions and other financial activities on long-term basis. While investment banking is advisory in nature which happens on short-term transaction basis. It is important to note that MS in Finance can be advantageous for a career in both domains.
  2. How can I succeed in investment banking?
    • Good communication and strategic skills can help to achieve success in investment banking. Acquiring the educational qualifications and experience will accelerate your success in this field. 
  3. Do you need a finance undergraduate degree to pursue investment banking?
    • A finance undergraduate degree is definitely helpful to pursue this career. Although if you get a MS in finance without a finance undergraduate degree, you can still pursue investment banking. 
  4. Can a finance degree get you a job in investment banking?
    • Yes. A finance degree goes a long way as it gives you the necessary skills and tools to success in investment banking. You can also opt for an MBA with specialization in finance or economics.
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