‘Investment Banking’ is the term applied to financial institutions active in the securities and foreign exchange markets. For example, raising capital for large corporations, trading and investing money for pension funds and wealthy individuals. These institutions range from the large global
investment banks, including the U.S. ‘bulge bracket’ institutions such as Morgan Stanley, Goldman Sachs and Merrill Lynch, to the likes of HSBC, Barclays and Royal Bank of Scotland, possibly better known for their high street retail branches that provide services for individuals. In addition, there are a host of smaller, specialised firms active in the financial markets including brokers, traders and money managers that, while not ‘investment banks’ as such, constitute an integral part of the financial markets and offer excellent career opportunities.
Most of the larger institutions offer formal training schemes for aspiring traders, investment managers, corporate financiers and for many other specialist occupations. It is probably true to say that investment banking offers rewarding careers for all types of person. Not surprisingly, given the glamour associated with the profession, including the seven figure bonuses and trading rooms the size of a football pitch, there are many applications for the graduate training opportunities offered by most of the large institutions. Make no mistake, you will not only have to be strong academically to succeed but, in addition, you must demonstrate a clear understanding of your chosen profession and show the personal qualities such as leadership, motivation and team-working that employers seek.
Sixth formers with an ambition to pursue a career in investment banking should think carefully about their next steps. Clearly, the choice of undergraduate study is important and sixth formers should choose subjects that they are genuinely interested in and where they are therefore most likely to perform well. For example, successful investment bankers have come from a wide range of academic disciplines: linguists, philosophers, historians and mathematicians will all be found rubbing shoulders on the trading floors. Many investment banks are not overly concerned about the subject studied, as long as a candidate can demonstrate a strong, creative intellect and raw ability. However, the evidence suggests that a majority of graduate recruits do possess degrees in the more ‘relevant’ subject areas, including Economics, Finance and Banking. In addition, graduates in the quantitative disciplines, such as physical sciences and engineering, are actively recruited.
If you decide to study for a degree in one of the mainstream, relevant areas, you will find a bewildering range of options, ranging from traditional one-subject honours courses to combinations, for example Economics with a foreign language. You can also choose a vocational course such as the BSc International Securities, Investment & Banking offered by the ICMA Centre, University of Reading. Speak with your school’s Careers Adviser to help you make the correct choice.
If your undergraduate degree is in a non-vocational discipline, you can join the increasing number of new graduates who decide to ‘top up’ their academic qualifications by studying for a vocational Master’s postgraduate degree to enhance their knowledge and prospects. There is a wide range of courses available in specialised subjects such as Investment Management, Financial Risk Management and Capital Markets Regulation & Compliance, to name just a few.
Just as important as academic attainments are the personal qualities that investment banks seek. For example,
A proven interest in finance and the markets
Get involved in your university’s investment society. Run a shadow portfolio of securities. Join an online trading game (but do not trade or bet online!) Read the financial press.
Evidence of interpersonal and leadership skills
Take every opportunity to develop interests that challenge you and build your character. The activities many people undertake during a Gap year are ideal, such as trekking or community support projects overseas.
Relevant work experience
Try to obtain vacation employment in a financial institution during your university studies or, better still, a summer ‘Internship’ with an investment bank at the end of your penultimate year of study.
There is no doubt that investment banking can be an excellent career but, be warned! However successful you become, you will always be subject to the vagaries of the financial markets. Rewards in a good year can be immense, but you are just as likely to be out of a job in the next if the markets decline sharply. While some people relish this environment, others will come to hate it. If you fall into the latter category, consider the alternatives, working in a more stable area of finance such as retail banking management, central banking, financial control, or perhaps becoming a chartered accountant or tax specialist.
Just to sum up, all the evidence demonstrates that investment banking will continue to offer a huge range of good career opportunities for graduates in the foreseeable future. Consider all the options open, not just the high profile occupations like trading. Most investment bank websites contain a great deal of information about their business. Many have careers pages that explain the various opportunities available, what qualities are sought and how the recruitment process works. Don’t forget to visit your school or college’s Careers Advisory Service and discuss your ambitions with them.
Sixth formers with an ambition to pursue a career in investment banking should think carefully about their next steps. Clearly, the choice of undergraduate study is important and sixth formers should choose subjects that they are genuinely interested in and where they are therefore most likely to perform well. For example, successful investment bankers have come from a wide range of academic disciplines: linguists, philosophers, historians and mathematicians will all be found rubbing shoulders on the trading floors. Many investment banks are not overly concerned about the subject studied, as long as a candidate can demonstrate a strong, creative intellect and raw ability. However, the evidence suggests that a majority of graduate recruits do possess degrees in the more ‘relevant’ subject areas, including Economics, Finance and Banking. In addition, graduates in the quantitative disciplines, such as physical sciences and engineering, are actively recruited.
If you decide to study for a degree in one of the mainstream, relevant areas, you will find a bewildering range of options, ranging from traditional one-subject honours courses to combinations, for example Economics with a foreign language. You can also choose a vocational course such as the BSc International Securities, Investment & Banking offered by the ICMA Centre, University of Reading. Speak with your school’s Careers Adviser to help you make the correct choice.
If your undergraduate degree is in a non-vocational discipline, you can join the increasing number of new graduates who decide to ‘top up’ their academic qualifications by studying for a vocational Master’s postgraduate degree to enhance their knowledge and prospects. There is a wide range of courses available in specialised subjects such as Investment Management, Financial Risk Management and Capital Markets Regulation & Compliance, to name just a few.
Just as important as academic attainments are the personal qualities that investment banks seek. For example,
A proven interest in finance and the markets
Get involved in your university’s investment society. Run a shadow portfolio of securities. Join an online trading game (but do not trade or bet online!) Read the financial press.
Evidence of interpersonal and leadership skills
Take every opportunity to develop interests that challenge you and build your character. The activities many people undertake during a Gap year are ideal, such as trekking or community support projects overseas.
Relevant work experience
Try to obtain vacation employment in a financial institution during your university studies or, better still, a summer ‘Internship’ with an investment bank at the end of your penultimate year of study.
There is no doubt that investment banking can be an excellent career but, be warned! However successful you become, you will always be subject to the vagaries of the financial markets. Rewards in a good year can be immense, but you are just as likely to be out of a job in the next if the markets decline sharply. While some people relish this environment, others will come to hate it. If you fall into the latter category, consider the alternatives, working in a more stable area of finance such as retail banking management, central banking, financial control, or perhaps becoming a chartered accountant or tax specialist.
Just to sum up, all the evidence demonstrates that investment banking will continue to offer a huge range of good career opportunities for graduates in the foreseeable future. Consider all the options open, not just the high profile occupations like trading. Most investment bank websites contain a great deal of information about their business. Many have careers pages that explain the various opportunities available, what qualities are sought and how the recruitment process works. Don’t forget to visit your school or college’s Careers Advisory Service and discuss your ambitions with them.
