Surely many have heard about such a specialty as an investment banker. But not everyone imagines what people in this profession do. In fact, investment bankers are agents who help their customers invest wisely. They also carry out various operations aimed at making a profit for them. Most often this is the purchase and sale of securities, which the specialist conducts on behalf of his client. This is briefly. In fact, this topic is much more meaningful.
Getting an education
Few succeed in achieving success in the financial sector without first having to go to college. Moreover, without the presence of desire, aspiration and special thinking, not every person who has graduated from the corresponding faculty can take such a position as an investment banker.
Where does the one who becomes them study? As a rule, at the financial or economic faculty. Technical universities, in which there are, are throughout the country. If prestige is important, then it is worth submitting documents to one of the following five institutions, which are the most rated and popular:
- St. Petersburg State University;
- Finance Academy under the Government of the Russian Federation;
- High School of Economics;
- Moscow State University named after M.V. Lomonosov;
- Moscow State Institute of International Relations.
Graduates of these universities who have received a diploma in "Finance and Credit" or "Banking" are more likely to accept the previously mentioned position.
Specialist role
It is also necessary to deal with it. An investment banker is a financial specialist who saves companies money and time by identifying risks associated with a project. So it helps determine whether it is worth translating it into reality.
He is also an expert monitoring the current investment climate. Various institutions turn to him in order for the specialist to give recommendations regarding the development planning of their company. This is advisable, since an investment banker can advise on the best actions regarding the current state of the economy.
Mediation between investors and the company
It is also the responsibility of a specialist. An expert is an intermediary between an investor and a company when the company intends to start issuing bonds or shares.
At this stage, the banker helps them navigate regulatory requirements, and evaluate financial instruments, as this is necessary to maximize revenue. In other words, he brings the company representatives to the implementation of Initial Public Offering - the initial public offering.
IPO
After its implementation, the investment bank (IB) redeems most of its shares. Or, all in all. It is very beneficial for them.
Primary stocks are inexpensive. By purchasing a significant part of them, the bank becomes authorized on behalf of the company that conducted the IPO. Subsequently, he sells all shares in the market at an inflated price. This is useful for the company itself. After all, she leaves the IPO directly to IB.
In this rather complex chain of sequences, the investment banker plays a crucial role. It is on his shoulders that a miscalculation of risks, prospects, and multi-level analytics of various economic aspects lies.
Activity specifics
Above was a little about what a person like an investment banker is.Who this is is clear, so now you can talk in more detail about his other responsibilities. They, with the exception of the notorious mediation and development of plans, are many.
People in this profession are required to process tons of confidential information about the companies that are their customers. Accordingly, they must respect trade secrets and not use them for personal gain.
These specialists are also required to comply with the standards of conduct of their investment bank, which are provided for by the internal regulations of the company. Therefore, they sign the corresponding confidentiality agreement. This code identifies limited terms regarding the processing of classified business data. Confidentiality is so important that often one investment banker does not have the right to contact other employees of the organization on work issues.
In addition, in this area there is a conflict of interest or the potential for its occurrence. It usually happens when trading and advisory units of investment banks begin to interact. Why? Because information security companies are engaged in business, both for themselves and for external clients.
About personal qualities
Many financiers and economists would like to become such a specialist as an investment banker. Who is this expert, and what he does, was described above. Now - a few words about what qualities he should possess.
In addition to an appropriate diploma of education, a potential banker must have excellent numeracy, developed skills in written communication and verbal communication, as well as an absolute opportunity (preferably comparable with a desire) to work as long as necessary. This is one of the reasons why many do not cope with responsibilities. Not everyone is ready to forget about his personal life and spend the night in the office. For many, it is difficult and debilitating.
But this is not all the qualities that an investment banker should have. Who certainly must be frugal, disciplined, proactive, patient, attentive and purposeful - this is it. In addition, decency, honesty and responsibility cannot be dispensed with. But the most important thing is the presence of the ability to analytical thinking, instant response to unforeseen situations, and the instantaneous finding of “reserve” optimal solutions that can save the situation.
Salary
The activities of this specialist cannot be called easy. But why do many people want to occupy such a position as an investment banker? Salary is the main reason. If you believe the official data, then even a novice specialist can receive about 200 thousand rudders per month.
And this, one can say, is the minimum that an investment banker can count on. The salary of a professional with many years of experience may well be $ 1,000,000. And even more. But for this it is necessary to have a good education, to take additional courses abroad in the field of management, economic analysis and finance, and have about 10 years of experience in large companies and investment banks.
The beginning of the path to success
Even the aforementioned information is enough to understand that becoming an investment banker just doesn’t work out that way. Need education and skills. And also make a decision in which particular field you want to prove yourself.
Such specialists are needed in the corporate finance department. They, just, carry out consulting duties.
The mergers and acquisitions department is a kind of "elite". Why? It’s clear even from the name of the department. Which, incidentally, often collaborates with corporate finance.
Bankers are also needed in the public finance department. The tasks there are one-sided, and they consist in the sale of securities. Only cooperation is conducted only with government agencies.
The last department where an investment banker can work is called analytical. It assumes constant contact with the company’s management, the study of financial reports, market trends and many other related operations.
Turning to an Expert
Now I would like to draw attention to 6 key trends. The investment tips of the Swiss banker Andreas Feller will help even a novice understand everything related to a given topic.
First of all, the specialist notes the phenomenon of the digital revolution. Now is the time when the volumes of knowledge and projects accumulated by science are rapidly being realized. Take, for example, unmanned vehicles or delivery using drones. Everything modern, relevant and able to make life easier is a key area of investment. Dotcoms, companies whose business model is based on work in the World Wide Web, belong to the same trend. Their main principle is to expand the customer base and its subsequent monetization.
The second global trend is the rapid economic boom in Asian countries, especially in China. Since 2005, the annual output in China has quadrupled! And now there are several directions for the development of the economy, where knowledgeable people invest. We are talking about food security, defense, healthcare and green energy. Against this background, there is an increase in the middle class in China. What is a good direction for investing in enterprises in the consumer sector.
Urbanization
This is the next important trend. The role of cities in the development of society has recently been increasing. Here, prospects are also observed in Asian markets. After all, everyone knows how many people live in China and India. Accordingly, in this case, the most important factor in GDP growth is the development of infrastructure and the construction of residential buildings. In the medium term, a good profit can bring investments, both in these areas, and in the production of household appliances.
The fourth trend is similar to the third. It is related to the so-called border markets. This term is used to designate states with high growth potential that have not yet developed to the level of countries with strong economies. These include Vietnam and Africa.
True, in this case, the risks are great. Investing in border market enterprises must be done carefully and selectively. That is, follow the principles of a diversified portfolio.
Global approach
The last two trends are associated with it. The fifth is lifestyle changes around the world. Life expectancy is increasing, and the demand for medical equipment and health services is growing. Accordingly, the option of investing in pharmaceutical companies is becoming increasingly popular.
The sixth trend, in turn, is associated with global changes in the energy sector. More and more attention is being drawn to enterprises engaged in new energy sources. A prime example is the popularization of solar panels.
Opinion of another specialist
Considering such an interesting topic, I would like to turn to the work of such a specialist as Inozemtsev Alexey Borisovich. Investment banker, entrepreneur, strategy consultant - this is his main activity. And he has a very unusual approach.
The expert advocates the management of financial capital through mechanisms of companionship and cooperation. He believes this is better than a tense struggle, without which it is difficult to do in the investment business. But if we succeed in moving to this model, then we will be able to discover new professional horizons.
However, this is all about the approach. He has his own. But the specialist recommends investing in education. These are investments in the future of the country.Since education is the main point of growth, and from the point of view of both a person and society. If everyone will be sufficiently intellectually developed, then the financial sector, together, will be able to bring to a new level of development.
Such conclusions can be drawn from the words of Alexei Borisovich. Thoughts are correct, but you need to understand that the implementation of the described will require a lot of effort, time and social mobilization.
Idioms
Finally, it is worth noting the attention of the best statements of investment bankers. Many of them have a motivating and instructive meaning.
Here is one of these phrases: "Ultimately, a professional investor seeks to play with other people's finances." The phrase belongs to Robert Kiyosaki. Billionaire, a major American businessman, financial observer and investor who started out as a simple sales agent at Xerox Corporation.
He also owns this expression: “A professional investor will not invest in an asset that can justify itself only when moving in one direction. Or in a program that does not allow you to exit it at the right time. " This can even be attributed to certain commandments that good financiers must observe.
And in conclusion, you can bring this phrase: “The most valuable asset is time. Many people do not know how to use it. They work to make others richer, but do nothing to become wealthy themselves. ” And indeed it is. In fact, many people have the opportunity to increase their capital. Especially with investment bankers with relevant knowledge and experience.