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What Is an Investment Banker?

Investment bankers are investment professionals who combine financial services industry expertise, analytical prowess, and effective persuasive communication skills to support institutional clients in activities like capital raising and mergers and acquisitions. Investment bankers lend their corporate finance services to clientele ranging from startups to established organizations and, in some cases, even governments. Whether they work for an investment bank or the investment banking division of an organization, they are key players in the financial growth and development of a business, organization, or other corporate entity. Investment banker is a broad term that includes roles ranging from an entry-level investment banker to a high-level position like executive vice president.

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What Does an Investment Banker Do?

This career is often coveted because a successful investment banker can enjoy a high salary, abundant networking opportunities, and the ability to play a highly visible role in company success stories. Nevertheless, the day-to-day work of an investment banker is typically demanding, fast-paced, and may be considered stressful by those who enjoy a more relaxed work-life balance. If you are looking for employment with a typical 40-hours per week and flexible scheduling, investment banking may not be the path for you.

Investment Banking Job Description

In addition to building strong client relationships, an investment banker may be involved in any of the following financial advisory activities for corporate clients:

  • Capital Raising
    • Book Building
    • Prospectus Drafting
    • Initial Public Offerings (IPOs)
    • “Roadshow” Investment Meetings
    • Issuing & Selling Securities
  • Private Placement of Capital
  • Mergers, Acquisitions & Divestitures
  • Corporate Restructuring
  • Debt & Equity Advisory Services
  • Bond Issuance & Pricing on Bond Markets
  • Hedge Fund, Mutual Fund, & Pension Fund Advisory Services

Job responsibilities will vary depending on the role and client needs.

How to Become an Investment Banker

As with most financial careers, it is easier to get into investment banking if you build a foundation of financial expertise in your formal education and early work experience. Typical investment banker resumes will include previous financial advising, financial management, trading, or general business consulting experience. Investment banks typically look for undergraduate and graduate degrees that align with business administration, finance, commerce, economics, or an analytical field like statistics. It is not impossible for individuals with other backgrounds to make the transition into a career in investment banking, but the ability to prove both quantitative acumen and persuasive communication skills is essential.

The amount of time it takes to become an investment banker may vary by institution and role responsibilities. In general, the U.S. Bureau of Labor Statistics notes that Financial Management professionals, including investment bankers, typically enter the field with a bachelor’s undergraduate degree and at least five years of experience in a related field.

Is an Investment Banking Career Right for Me?

Before you apply for an investment banking role, consider your answer to the question “Why investment banking?” a question posed at the beginning of many interviews for careers in investment banking. If you are unsure how to verbalize your answer to this question—especially if your main motivation is a higher salary or a career at a prestigious institution—consider highlighting some of these qualities if they describe you well.

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    Data-Driven Thinkers

    As mentioned above, investment bankers need analytical skills that can support them in advising organizations on crucial financial decisions. Investment bankers do not necessarily need to be career mathematicians, but they need math skills to perform calculations related to pricing and financial models.

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    Sales-Minded Communicators

    For investment bankers who work in capital raising or specialize in helping startup businesses secure funding, interpersonal skill and persuasive communication are key. Investment bankers need to be extremely effective writers and public speakers on behalf of their clients. Furthermore, as client services professionals, investment bankers need to be skilled in developing and presenting “pitch books” to help them win new business from potential investors and clients.

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    Ethics and Compliance Leaders

    Finally, a skilled investment banker is someone who strives to absorb knowledge and expertise about their clients’ markets. They should pay close attention to the legal regulations that govern their clients’ industries and have a vested interest in steering their clients towards decisions that are both profitable and ethically sound in the long run.

The Investment Banking Career Path

Many investment banking institutions will offer paid internships for college students and recent graduates, which can count toward necessary years of experience and be helpful for networking. Some investment banking firms may show a preference for candidates with advanced degrees from a business school, but you should be sure to research position requirements in your area of interest before committing time and money to an advanced degree.

Entry-level investment bankers may be referred to as “junior bankers” broadly, but job titles will more likely use the term “analyst” to indicate a true entry-level position and “associate” to indicate a role requiring some experience. Conversely, the term “senior bankers” will be applied to those with significant investment banking experience. Job titles in this category will include terms like “vice president (VP),” “senior vice president (SVP),” “director,” or “managing director.”

Other Finance Career Tracks

Interested in exploring other financial services roles? Check out our Career Hub for more role descriptions, including:

How Can the CFA Program Help Me?

While there is not a standardized graduate degree or certification that investment bankers need to obtain to break into or advance in the industry, the CFA® charter can still provide a useful knowledge base and differentiate you from your peers in the investment banking field. Moreover, because investment bankers are in demand around the world, the global reputation of the CFA charter as the “gold standard” for investment credentials can help open professional opportunities with financial institutions in diverse markets around the world.  

Explore whether CFA Program is the right choice for your next career steps

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