If you’re interested in a career in investment banking, there are a few things you should know before you get started. Investment banking analysts provide support to associates and investment bankers in all aspects of the deal-making process. They build financial models, carry out financial analysis and due diligence, create presentations, conduct research, and handle a variety of other duties. If you’re thinking about becoming an investment banking analyst, here are ten things you should know first!
1) Investment Banking Analyst Is An Entry Level Job
Investment banking analysts are entry-level professionals who provide support to associates and investment bankers. They build financial models, carry out financial analysis and due diligence, create presentations, conduct research, and handle support duties. While the job is considered entry-level, it is also a highly coveted position. Investment banks typically hire only the best and brightest from top MBA programs.
2) Investment Banking Is Extremely Competitive
If you’re interested in a career in investment banking, you’ll need to be prepared to compete with other top candidates. Investment banking is a highly competitive industry, and the analysts who are successful are usually the ones who have the drive and determination to succeed. If you’re up for the challenge, becoming an investment banking analyst can be a great way to start your career in the industry.
3) You Will Make Your Friends Jealous
Sell-side analysts earned salaries that ranged from $56,500 to $107,000 in 2019, according to the 2020 Robert Half Salary Guide for Accounting and Finance Professionals. Additionally, they typically received other compensation, including average bonuses of $4,044, commissions of $10,279, and profit-sharing of $2,042. Analysts usually receive benefits such as paid vacation days and sick leave, health, and life insurance, a 401(k) or other retirement savings plan, and signing and year-end bonuses. Many investment banks offer dinner stipends and travel reimbursements to employees who work more than 100 hours a week as a small token of appreciation for their hard work.
Keep in mind that salaries look high on paper, but the number of hours worked lower your hourly wage significantly.
4) You Will Work A LOT
People know investment banking as an industry with long hours. Analysts typically work between 60 and 80 hours a week, and some even work more. The job is demanding and requires a lot of dedication, but the rewards can be great.
5) No One Guarantees You A Job
Investment banking is a volatile industry. No one will guarantee you a job. Investment banks can and do lay off analysts when business slows down or when deals fall through. The firms hire entry-level analysts for 2 years. For an investment bank to retain an analyst, the analyst needs to prove their worth. If you prove your worth, the bank can promote you to associate. However, if you’re a good analyst and you work hard, you will be in high demand and should be able to find another job relatively easily.
6) You Will Need Education
Investment banking analysts typically have a bachelor’s degree in business, economics, or finance. They also need to have strong analytical and problem-solving skills, as well as the ability to work well under pressure. If you’re interested in becoming an investment banking analyst, make sure you have the education and skills required for the job.
7) You Will Learn So Much
Working as an investment banking analyst is a great way to learn about the industry and develop your skills. Investment banks provide their analysts with extensive training, and you’ll have the opportunity to work on a variety of deals. You’ll also be able to learn from more experienced bankers and get exposure to different areas of the business.
8) You’ll Be An Excel Pro
Investment banking analysts use Excel to build financial models, and they need to be proficient in the software. If you’re not already an Excel expert, don’t worry – you’ll learn quickly on the job. Investment banks typically provide their analysts with training on how to use Excel for modeling.
Excel is a powerful tool, and being able to use it effectively is essential for success as an investment banking analyst.
9) Digital Finance Is Important
In today’s world, digital finance is becoming increasingly important. Investment banks are using technology to automate processes and speed up deal-making. To that end, you’ll need to be comfortable with using different types of software and technology.
Digital finance is an important skill for investment banking analysts, and it’s only going to become more important in the future.
10) It’s Your Career, No One Else’s
Investment banking is a demanding job, but it’s also a great career. Really, it comes down to what YOU want out of a job. You can be successful in the industry if you are dedicated and hard-working. Investment banking is a competitive field, but if you’re willing to put in the work, you can make a name for yourself.
So there you have it – ten things you should know before becoming an investment banking analyst. Investment banking is a great way to start your career in finance. The job is demanding and requires long hours, but it is also highly rewarding. If you’re up for the challenge, becoming an investment banking analyst can be a great way to launch your career in the industry.
Have any questions? Are there other topics you would like us to cover? Leave a comment below and let us know! Make sure to subscribe to our Newsletter to receive exclusive financial news right to your inbox.