Financial Blog
Should I Become an Investment Banker
I want to become an investment banker. For anyone in Quebec, a banker is often limited to mergers and acquisitions – the famous M & A. While finance is a broad area, the media are very worn on the tragedy and the financial press is no exception. The drama that emerges from the battles being waged within companies over bid (OPA) a lot of interest from the press, explaining why become an investment banker in the merger is often aims the uninitiated to the sector. Yet this work represents only a tiny business in the financial sector. Indeed, one of the oldest areas in which by far the largest sums are played is the capital loan. This section proposes the reader an introduction to the range of activities in finance.
A first look at occupations
Financial Project : the purpose of trade is financing infrastructure projects such as building a bridge, a hospital, a power plant or oil using primarily non-recourse debt and repayable the long term, 25 for example.
Commercial Banker : The banker is the commercial banking business classic par excellence. Very simply, it is funding the working capital of a business (buying inventory, receivables) and lends money to help a company to buy real estate or other businesses.
Venture capital : venture capital fills a role similar to that of the commercial banker but target companies that have not yet a risk profile low enough to meet the lending criteria of a commercial bank. Usually, the venture capitalist has received training in science (engineering, medicine), has experience in industry (the oil sector, manufacturing, medical research) and subsequently completed training in business (often an MBA) . The typical customer of a bank’s venture capital is usually a leading company with a product with good market potential but with little or no sales.
Banker acquisition and merger : it advises the industry leaders in procurement business (or how to repel unsolicited offers to buy) and they finally found the necessary capital to purchase. Often the acquisition banker himself has not the necessary capital to finance an acquisition but has the network needed to be purchased (ie pension funds, insurance companies or through the stock market) . Finally, although we speak of ” banker>> (conjuring the image of a person working in a bank and advancing funds), the investment banker usually is not really a banker in the strict sense of one who advances money, but rather an accountant or a graduate in finance as advisor. mandates that the sums are below the half million will be confidential clothing ed to major tax preparation firms like KPMG, PwC, Deloitte, E & Y, Grant Thornton. Transactions involving larger amounts will be passed on to U.S. investment banks like Merrill Lynch, Morgan Stanley or companies specializing in mergers such Laazard, Cazenove. Our advice then if you are in Quebec and want to become an investment banker, become an accountant!
Banker to handle transactions (or leverage or LBO ) : bankers or financial transactions to leverage finance the purchase of a company employing thousands of high-rate debt (ie 225 to 800 basis points above the benchmark rate. 100 basis points = 1% ). Although the profession of banker lever is linked to that debt, it is very different from traditional trade exercised by the commercial banker. Leveraged Transactions introduce a lot of debt in a company which increases its financial fragility and thus its risk fault. Therefore, although the contractual nature of capital tied up in a leveraged transaction is identical to the debt (repayment obligation, interest rates, guarantees, etc..), The risk of this debt are as they are rather domain actions. And that is why the debt used in leveraged transactions is often referred to pejoratively as speculative and even junk in financial jargon.
Financial analyst rating and financial obligations : the job is often less well known that companies offering services including Fitch ratings, Standard & Poor’s and Moody’s and to a lesser extent DBRS. A rating analysis analyst financial obligations issuance by a company or report to the public – debt lent by a bank, it is not rated .
Portfolio Manager : A manager move large sums of money because its business is the condition of capital under management. In the brokerage industry, the portfolio manager is the most important person to the extent that pay commissions to brokers who return in exchange for good (hopefully) investment advice.
Analyst Actions : An analysis of shares is somehow a financial investigator. His r ole is the study of the financial performance of publicly traded companies with the purpose of recommending a portfolio manager buying or selling shares.
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