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Home » A Comprehensive Guide on How to Become an Investment Banker: Unlocking the Path to Success

A Comprehensive Guide on How to Become an Investment Banker: Unlocking the Path to Success

how to become an investment banker

Are you someone who is intrigued by the fast-paced world of finance, and the idea of helping companies grow and succeed through strategic investments? If yes, then you might want to consider a career as an investment banker. Do you need information on how to become an investment banker? Yes, continue reading to find out all your answers… 

Investment banking is one of the most sought-after professions in the financial industry. It is a highly competitive field that offers attractive salaries, prestigious job titles, and exciting career opportunities. If you are interested in becoming an investment banker, you might be wondering where to start and what it takes to succeed in this field.

Becoming an investment banker is a dream career for many ambitious individuals, but it’s not an easy path to take. The competition is tough, and the job requires a unique set of skills and qualifications. So if you are ready to embark on an exciting and challenging career in investment banking, read on to learn how you can make your dream a reality.

Who is an investment banker? 

An investment banker is a professional who works in the financial industry and provides financial advisory services to corporations, governments, and other institutions. Investment bankers help clients raise capital by underwriting and selling securities, such as stocks and bonds, and assist in mergers and acquisitions, initial public offerings (IPOs), and other types of financial transactions.

Investment bankers work in a fast-paced and competitive environment, often with high-profile clients and complex financial transactions. They need to have strong analytical and quantitative skills, excellent communication and interpersonal skills, and a deep understanding of the financial markets and regulatory environment.

What does an investment banker do?

Here are some of the key responsibilities and tasks that an investment banker typically performs:

  1. You need to understand the financial conditions and goals of individual clients or businesses and make investment decisions on behalf of them or advise them on where to invest regarding shares, bonds, mutual funds, etc.
  2. Research extensively on capital markets (such as stock markets) and thereafter, create and implement actionable investment strategies for clients.
  3. You will have a pivotal role in deciding the best-suited investment plan for your clients, based on their income, return expectations, time horizon, risk preferences, and risk tolerance factors as well as financial market conditions.
  4. Apart from working with individual clients, you may also work with corporate or institutional investors. Meeting with investment analysts, market researchers, and company managers regularly is a part and parcel of your job.
  5. You will primarily deal in buying and selling securities (stocks, bonds, debentures) to help your clients achieve their financial goals.
  6. Some professionals have to make strategic investment plans and portfolios for their clients, while others simply manage clients’ investment portfolios and transactions.

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Why become an investment banker? 

Following are some reasons why someone might consider becoming an investment banker:

  1. High earning potential: Investment bankers are among the highest-paid professionals in the financial industry, with the potential to earn six- and seven-figure salaries.
  2. Challenging and rewarding work: Investment banking is a highly competitive and fast-paced field that offers exciting and intellectually challenging work.
  3. Opportunities for career advancement: Investment banking offers a clear career path with opportunities for promotion and advancement to higher positions.
  4. Exposure to top-tier clients: Investment bankers often work with high-profile clients, such as Fortune 500 companies and government agencies, which can provide valuable networking opportunities and enhance their professional reputation.
  5. Prestige and status: Investment banking is considered one of the most prestigious professions in the financial industry and can provide a sense of accomplishment and recognition.
  6. Transferable skills: Investment banking provides valuable skills that are transferable to other fields, such as finance, consulting, and entrepreneurship.
  7. Global opportunities: Investment banking is a global industry, which can provide opportunities to work in different regions and gain international experience.
  8. Impact on the economy: Investment bankers play a crucial role in facilitating capital markets and promoting economic growth, which can be personally rewarding.

Popular specialization in investment banking

In this section, we will be mentioning some of the popular specializations in investment banking careers. 

Sales Manager (Investment Banking Service)

As a Sales Manager (Investment Banking Service), you are responsible for selling Mutual Funds, Portfolio Management Services, Private Equity Products, Bonds, Structured Products, Life Insurance, General, Motor & Health Insurance, Loan Products, Real Estate & Direct Equity to various clients.

Investment Advisor

As an advisory manager, you will advise your clients about any possible risk involved in any particular deal. As you have learned above that many businesses raise money by selling securities, as an investment advisor, help your client decide which security is the best to invest in. You will advise and them to avoid risky security (i.e., investment in companies where a business might crumble, or might not be able to grow).

Asset and Portfolio Managers/ Wealth Managers

Asset and Portfolio Managers/ Wealth Managers manage investment portfolios. A portfolio means different kinds of investment options. Like, an individual may have a good amount of wealth, if he or she wants to invest in a good deal where this money can grow, he or she will ask to help them. They can invest this wealth in one investment, but what if the investment fails? This may be risky So you will divide this wealth into different sums, and put each one of them in different stocks, insurance, banks, real estate, etc. Thus, you will reduce the risk of failure of any one investment. Depending on the type of portfolio management job, they could work for individual clients or as part of a larger firm or financial institution.

Financial Analysts

Financial Analysts specialize in advising clients/ employers where to buy or sell stocks based on their research of the market. There are several factors (micro factors like the company’s own reasons for growth or fall like employees, and finances, etc. macro factors like economic conditions) that might lead to certain investments going up or down. Thus, you will study all these factors for all investment opportunities and report to your client on which investment is best and which should be avoided. If your client is selling their investment then again, you will research to find out when they should sell their investment.

Equity & Securities Analysts

Equity & Securities Analysts are a type of Financial analyst (you read above about them) who specialize in equity and security stocks. So, a financial analyst studies all kinds of investments, but you will only specialize in securities and equities.

Security Trader

A Security Trader specializes in buying or selling stocks and other commodities at a stock exchange for a commission. They work for companies or individual clients. So, basically, you will work for your client at the stock exchange, and for a commission, you will do all paperwork, and legal work to buy or sell securities. While Securities analysts only advice to their clients, you will do the actual work of buying or selling.

Risk Manager

Risk Manager specializes in identifying operational risk, credit risk, market risk, foreign exchange risk, etc. in the financial market and they recommend minimizing the effect of risks. When a client invests, there are many reasons that that investment might not be a great deal. There are many risks involved. Like what if today you are purchasing and tomorrow Rupee gets stronger than USD so the client will receive less money in Rupees. What if the company in which the investment was made gets close down a month after the investment? The client will now know of any future risks. So, they consult you as a risk manager. You will review all kinds of risks involved in the investment and advise clients to reduce risk.

Now, check out how to become an investment banker in India…

Steps to become an investment banker 

In this section, we will discuss the eligibility criteria to become an investment banker. The investment banking profession is an intermediary between a company and investors. They help raise capital for companies, governments, and other organizations. The 5 steps are discussed here.

Complete the class 12th exam

Candidates who wish to become an investment banker must have passed Higher Secondary (10+2) with a minimum aggregate of 50% or equivalent CGPA from a recognized board. For 10+2 exams, candidates have the option to choose between Arts, Commerce, or Science. However, studying mathematics, accounting, economics, business, and computer technology in the commerce stream can be more beneficial.

Completion in a related field

A bachelor’s degree is required to obtain an entry-level career in investment banking. Bachelor of Commerce (B. Com), Bachelor of Arts (B.A.) in Finance, B.A. in economy; and BBA in Finance are some of the best choices for becoming an investment banker. While each program’s curriculum varies, candidates can study mathematics, accounting, economics, financial management, corporate finance, investments, taxation, data analytics, and business administration, among other subjects.

Get a Master’s Degree

For aspiring investment bankers, a 2-year Master of Business Administration (MBA) in Financial Management is a sought-after graduate degree. Apart from this Master of Finance can also be obtained by candidates who want to become an investment bankers. The Academy of the National Stock Exchange (NSE) offers postgraduate programs in Investment Banking and Capital Markets, Banking and Financial Planning, Business Analytics, and Management Accounting that last between six and nine months.

Get Certification

Chartered Financial Analyst (CFA) can help candidates advance their careers as investment bankers. The CFA program provides intensive and hands-on investment and financial training. Economics, corporate finance, derivatives, equity investments, alternative investments, financial reporting and analysis, and quantitative approaches are among the subjects that candidates can choose to study. After obtaining a bachelor’s degree, candidates can apply for this program. The duration of the course can be from one to four years.

Get an internship

Investment banking internships can be found on job sites like Indeed, and on bank websites, as well as on campuses, networks, and HR consultancies. Internships at an investment bank can last from two months to two years. Candidates can learn to improve their communication, presentation, and negotiation skills in addition to financial training. They may be offered a permanent career as an investment banker depending on how well they perform during their internship.

Skills required to become an investment banker 

To become a successful investment banker, you need to possess a range of skills, including:

  1. Strong analytical and problem-solving skills: You should be able to analyze complex financial data and identify potential risks and opportunities.
  2. Excellent communication and interpersonal skills: You need to have the ability to communicate effectively and build strong relationships with clients, colleagues, and stakeholders.
  3. Financial acumen: You should have a deep understanding of financial markets, products, and regulations. This knowledge helps you to provide valuable advice to clients.
  4. Attention to detail: You need to be highly detail-oriented and accurate in your work, as even small mistakes can have significant consequences.
  5. Ability to work under pressure: Investment banking is a fast-paced and high-pressure industry. You should be able to work efficiently and handle multiple tasks simultaneously.
  6. Teamwork and collaboration: You will work in teams and collaborate with colleagues, clients, and stakeholders. Therefore, you should have excellent teamwork and collaboration skills.
  7. Time management and prioritization: You should be able to manage your time effectively and prioritize tasks based on their importance and urgency.
  8. Entrepreneurial mindset: You should have an entrepreneurial mindset and a willingness to take risks and pursue new opportunities.
  9. Professionalism and ethics: You should maintain high ethical standards and adhere to professional codes of conduct.
  10. Strong quantitative skills: You should be able to work with complex numerical data, and financial models, and perform valuation analysis.

Career progression in investment banking professional

  • If you join the risk management side as a Risk Modelling Manager, then you can become a Risk Director and then Risk Management Consultant and then finally VP of Market Risk. 
  • In wealth management, after joining as an assistant portfolio manager, you will become a Relationship Manager, then you can become a Team Leader and then Cluster Head of Wealth Management, and then finally VP of Wealth Management. 
  • If you are into research, then you can join as an analyst / Management trainee and then become a Research associate. Later you can become a senior Business Analyst and then a Consultant. 
  • If you are into the sales side of the business, then after starting as the assistant sales manager, you will become Sales Manager, then you will be Senior Sales Manager, and finally VP of Sales.

Job opportunities in investment banking 

You may start as a Portfolio Implementation Intern/ Finance Management Trainee/ Analyst Trainee or similar positions at the training level before entry-level job roles.

Then you may proceed to follow entry-level positions after your internship or traineeship.

You may, as well, surpass the internships or traineeships to join in any of these positions if you have relevant advanced qualifications as preferred by your employer.

15 Job Roles You Can Target

  1. Investment Strategist
  2. Portfolio Implementation Analyst
  3. Quantitative Research Analyst
  4. Analyst – Risk & Info Management
  5. Analyst – Asset Management
  6. Business Operations Analyst
  7. Finance Systems Analysis and Change – Analyst
  8. Specialist – Public Finance
  9. Quantitative Strategy Analyst
  10. Finance Analyst
  11. Business Impact Engineer
  12. Financial Quantitative Analyst
  13. Workforce Analytics Researcher
  14. Business Impact Analyst
  15. Associate – Corporate Finance

Salary of an investment banker in India

The salary of an investment banker in India can vary widely depending on factors such as the level of experience, the employer, the location, and the performance of the individual.

As per industry standards, an entry-level investment banker can expect to earn an annual salary of around INR 5 to 10 lakhs ($6,700 to $13,500). As the individual gains more experience and moves up the ladder, the salary can increase significantly.

For mid-level positions such as Associate or Vice President, the salary can range from INR 20 to 50 lakhs ($27,000 to $67,500) per year. For senior-level positions such as Director or Managing Director, the salary can go up to INR 1 crore ($135,000) or more per year.

It is important to note that investment banking is a highly competitive and demanding field, and salaries can vary widely depending on the individual’s skills, performance, and contribution to the organization.

Final words!

The future of investment banking in India looks promising as the country is poised to become one of the fastest-growing economies in the world. The Indian investment banking industry has seen significant growth in recent years, driven by strong economic fundamentals, a large population, and a growing middle class.

According to a report by the Boston Consulting Group, India’s investment banking industry is expected to grow at a CAGR of 7.5% from 2019 to 2024. The report also states that India has the potential to become one of the largest investment banking markets in the Asia-Pacific region, with a projected market size of $50 billion by 2025.

The growth of the investment banking industry in India is driven by various factors such as the increasing demand for capital raising and M&A activities, a growing number of startups and SMEs, and the government’s push towards infrastructure development.

Whether you’ve already planned a career in it or just starting to dip your toes in the thoughts of it, allow us to make it a bit easier for you. Hope we have served you enough! Still, got questions? Why don’t you connect with our industry experts? Yes, you read it right! You can get your queries resolved in just 60 seconds from our Career counselors. So, what are you waiting for? Download the iDreamCareer app now! 

iDreamCareer always believes in helping young minds discover their true mettle. We try to help young confused minds from 9th class10th classclass 11, and class 12 to select their most-suited career choices.

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What education do I need to become an investment banker?

Generally, a bachelor’s degree in finance, business, accounting, economics, or a related field is preferred for entry-level positions. However, advanced degrees such as an MBA or a Master’s in Finance can improve your chances of advancing in the field.

Do I need any work experience to become an investment banker?

While work experience is not always required for entry-level positions, it can be an advantage. Internships, apprenticeships, or other relevant work experience can help you stand out from other candidates.

What skills are important for a career in investment banking?

Strong analytical and problem-solving skills, excellent communication and interpersonal skills, financial acumen, attention to detail, ability to work under pressure, teamwork and collaboration, time management and prioritization, entrepreneurial mindset, professionalism, and ethics, strong quantitative skills, technology proficiency, industry-specific knowledge, adaptability, and flexibility.

How can I get a job in investment banking?

Networking, internships, and job fairs are excellent ways to get your foot in the door. You can also apply directly to investment banks or work with a recruiter.

What are some common career paths for investment bankers?

Common career paths for investment bankers include moving up the ranks within an investment bank, transitioning to private equity, hedge funds, or venture capital, or moving to a corporate finance role in a different industry.

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