Careers in finance can be enriching, both job satisfaction and compensation. And while investment banking may be one of the most coveted positions in the industry, it’s also one of the most competitive.
There are various roles in investment firms, from working with clients to win business to providing analysis and support for the firm’s sales and trading activities. But regardless of what role you’re in, specific skills will help you succeed.
While most people associate investment banking with a powerful world of suits, fast cars, and glamorous lifestyles, this is not the case. Investment bankers are, without a doubt, some of the world’s hardest workers.
What is Investment banking?
Investment banking is the division of a bank that helps companies and governments raise money by underwriting and selling securities. The role of an investment banker is to act as an intermediary between a company or government that wants to raise money (the issuer) and investors who are willing to buy those securities (the buyers). When a company or government wants to raise money, they will come to an investment bank and ask them to underwrite a securities offering. The investment bank will then agree to buy the securities from the issuer at a certain price and then sell them to investors at a higher price, making a profit on the difference.
Investment bankers must be able to sell their services to potential clients to gain business. This investment banking definition should give you a better understanding of the role that investment bankers play in the securities market. Investment bankers are responsible for mergers and acquisitions (M&A), initial public offerings (IPOs), and private placements. So, you see, many responsibilities come with this job title. They also have to support the sales and trading desk by coming up with new product ideas, providing analysis on companies, and helping to price and market securities.
However, the question remains; what are the top skills of an investment banker?
A typical day in the life of an investment banker requires analyzing and interpreting large amounts of data quickly and efficiently. This data can be in financial statements, economic trends, or market research. Analytical ability is a valuable tool in investment banking, brimming with complicated investment issues that need to be resolved. It covers mastery of behaviors at the ‘soft’ end of the dexterity spectrum.
The ability to pick the most useful pieces of information from a complex pool and represent them clearly and concisely is a unique skill in investment banking. It symbolizes an investment banker’s agility and intellectual curiosity. This skill is essential for investment bankers and people who aspire to work in other roles in the financial sector.
What’s the point of being able to handle complex financial data and analyses if you can’t communicate your findings to other people?
The investment banking industry is all about networking and building relationships. Investment bankers have to communicate with clients, colleagues, and upper management. They also need to present their ideas persuasively. Not everyone sitting across the desk understands the complexities of IPOs and M&A, so it’s the investment banker’s job to make sure they understand. It’s good that communication skills can be brushed up and improved with practice. If you’re not a natural communicator, don’t worry, you can still make it in investment banking. Just start taking a course on public speaking, TED-style coaching, or join a Toastmasters club.
The world of investment banking is rigid, reeking of tradition with its stuffy suits and boardroom meetings with heaps of bureaucracy. So why would an investment banker need to be entrepreneurial?
The answer is simple: the best investment bankers always think outside the box to develop new and innovative ways to do things. They’re always looking for new opportunities and ways to grow their business. The capacity to detect new business opportunities and find inventive solutions to problems distinguishes good investment bankers from excellent ones.
If you want to be a great investment banker, you need to start thinking like an entrepreneur. The recruiters are looking for people with an entrepreneurial spirit.
Investment banking is a highly desirable career in banking owing to its high financial compensation. However, it is also characterized by a high-pressure work environment, tight deadlines, and long hours. It can all take a toll on a person’s mental and physical health, so resilience is vital for investment bankers. Investment bankers must be able to handle stress and setbacks and pick themselves up after a bad day at work and keep going to survive in this competitive business. If you want to be an investment banker, you need to be resilient.
The avenue of investment banking is concerned with various complex financial operations that need to be completed more quickly and efficiently. It necessitates an understanding of data analytics, AI, and machine learning. That includes developing expertise in quantitative analytics, statistics, and data processing – all critical aspects when dealing with big data in finance. An investment banker should also be proficient in Excel, Bloomberg Terminal, and other financial software. They should have a strong understanding of financial concepts and be able to apply them in real-world scenarios. If you want to work in investment banking, you need strong technical skills. You need to be able to understand and use the financial software that is used in the industry.
There are only a handful of investment banks globally, and they all have a global reach. Investment bankers need to be able to think on a global scale. They need to see the big picture and understand how the different pieces of the puzzle fit together. An investment banker must identify opportunities and trends in the global market and be able to take advantage of them. They need to have a strong understanding of the different economies worldwide and how they interact. To improve your global outlook, start reading the financial news from different countries.
Time management, discipline, and creativity are other skills needed to be a successful investment banker. However, the most critical skill that an investment banker can have is the desire to learn. The best investment bankers are always learning. They are always trying to improve their skills and enhance their knowledge. What’s standing between you and your dream of becoming an investment banker? Start learning and developing the skills needed to succeed in this competitive industry.