All you need to know about Becoming an Investment Banking Analyst

Investment banking careers are among the most demanding but rewarding financial careers. Working in investment banking will allow you to help firms, individuals, and organizations succeed financially and trade in real-time financial markets. Additionally, an investment banking analyst position is a great way to grow your career in finance.

What are investment banks?

Investment banks are intermediaries between investors such as companies and financial markets. Consequently, investment banks provide financial advice, trade stocks on behalf of their clients, assist businesses to become publicly traded, and help during acquisitions and mergers. Additionally, the research market trends enable their clients to make profitable financial decisions.

What is an investment banking analyst?

An investment banking analyst evaluates and investigates opportunities to find one that meets their clients’ objectives. As a result, they make recommendations based on this assessment to meet corporate clients’ financial needs and specifications. In most instances, they work as part of a larger investment team and report to the investment banker who guides the client.

Corporate clients are diverse and include new investors, the analyst’s company, or existing investors. When working with new clients, research opportunities, gather the data, and present it to the investment team or client. On the other hand, the analyst evaluates old investors’ existing investments and recommends keeping or replacing them depending on their performance.

If you work for your company, you will assess the business assets, analyze earning reports and keep up-to-date financial industry trends to provide information-based investment recommendations. Additionally, investment banking analysts review and analyze stock and bond performance and credit trends, compile the analysis results, and present them to the investment team, baker, or client.

Investment banking analyst is the ideal career for you if you are interested in financial modeling, financial markets, high profile transactions, and thrive in a quick-paced and high-pressure working environment.

How is an investment banking analyst different from an investment banker?

An investment banking analyst is an entry-level position for candidates with a degree majoring in finance. Investment bankers likely started as investment banking analysts and advanced to associate roles after several years of experience.

Unlike investment banking analysts, investment bankers are the intermediary between corporate clients and their banks. Therefore, they are essential to investors who want to earn revenue for their activities. Investment bankers guide businesses through large financial transactions and processes such as mergers, acquisitions, public listing, and raising money through issuing securities.

In addition, investment bankers utilize financial models to assess the cost of financial instruments, ascertain possible risks and returns, prepare investment reports and present them to their corporate clients.

How do I become an investment banking analyst?

Investment banking analyst jobs are gratifying, and you could potentially grow your career in the financial industry. However, the position is highly competitive, and it would be best to stand out from other candidates.

Education

The first qualification you need is an undergraduate degree. For example, if you want a career as a financial analyst, choosing a business-related major such as accounting, mathematics, and finance would be best. However, even if you studied a major unrelated to finance, for example, humanities or foreign language, you can still apply the skills learned to investment banking.

Investment banking internship

Completing an investment banking internship is an excellent way to get real-life experience. You will gain the required skills and experience that will help you secure jobs in the future. Additionally, you are likely to be considered for employment in the company where you undertook your internship. Finally, an internship helps you form professional networks and develop relationships with employers and colleagues who can mentor or act as your referees.

Pass securities exam and register with FINRA

You should register with the Financial Industry Regulatory Authority to represent your
investment bank to work as an investment bank analyst. Moreover, you might be required to pass securities exams to get an operating license where applicable.

Become a CFA charter holder

You can give yourself an edge and stand out as an investment banker by attaining a CFA certification. The CFA Institute offers chartered financial analyst (CFA) accreditation. The charter is for investment and financial professionals, and its curriculum covers topics in investment and finance.

Additionally, the curriculum covers portfolio management, financial analysis, derivatives, stocks, bonds, and ethics. The course is offered internationally and recognized as the gold standard for all financial analysts. Earning the CFA certification will help you stand out in the workplace and network through the CFA societies.

Contact us at Analystprep.com to access a vast library of study materials to help you prepare for your CFA exams. Our online study notes and video lessons will help you assimilate the most complex concepts. We have up-to-date question banks that will help you practice how to answer exam questions. You will sharpen your skills with our computer-based testing mock exams and customizable quizzes.