Investment Banking:Life as an Analyst
Analysts are typically recent undergraduates who work long hours and do a fair bit of grunt work. A good analyst helps his or her boss get their job done and done well. Analysts are not normally expected to contribute in meetings but often can. After the typical two-year analyst program at a major investment bank, many analysts return to school for an MBA before coming back to investment banking. Others choose to try other opportunities. During recruiting out of an MBA program, former analysts will be at a significant advantage over others without experience.
Key analyst skills include:
- the ability to work with Excel spreadsheets,
- write macros in VBA,
- track and generate weekly newsletters (weeklies),
- keep schedules,
- generate prospectuses,
- get burgers
- put in and retrieve pitch books from the copy center
- and answer client phone calls.
Key success factors include (i) getting your job done well and without friction, (ii) getting things done on time, (iii) asking for help when you need it, (iv) dressing neatly, (v) not complaining, gossiping or whining, (vi) learning to use the library and the web to do research, (vii) become a whiz-kid with Bloomberg, Excel, Word and Powerpoint, (viii) always give your boss credit, (ix) know when to cheer up your boss and (x) know when to stay out of the way.
A good analyst also networks, observes and thinks. You want to be genuine yet make it clear that you like your boss. Excessive posterior kissing is a negative. It's always good to have a little hobby as well like following stocks, playing Liars Poker or following currencies. You can do this when things get quiet in August.
It's a tiring life but gives you a good chance to learn the investment banking field and bond with people whom you will work with later. Being an analyst is one of the best ways to break into a very good field. The return on investment from being a good analyst can be over 50 times what they actually pay you.
After two years, most analysts leave to get their MBA or pursue other positions. It all depends on the firm. Some places have a pretty strict policy of getting rid of you. Others are more mellow. It makes sense, after all, to try to keep very good people who can get a job done. If you don't go back and get an MBA you might benefit from going out and getting a CFA.
- Fundamentals of Corporate Finance
- By Brealey, Myers and Marcus. An excellent, detailed book on topics in corporate finance. If you want to study what the field is about, this is a good book to start with. Keep this at your desk. An alternative finance reference book to use is Fundamentals of Corporate Finance by Ross Westerfield and Jordan.
- The Economist.
- A great source for info on what's happening in the world.
- Wall Street Journal.
- Should read this every day. The Financial Times is also quite informative.
- Vault Career Guide to Investment Banking
- Guide covers the basics of financial markets, including walk-throughs of equity and fixed income offerings, and M&A private placements and reorgs, and dissects career paths and job responsibilities at departments such as corporate finance, sales and trading, research, and syndicate.
- Valuation: Measuring and Managing the Value of Companies
- by McKinsey and Company
- A classic that should be in the cube of every analyst and associate on the Street. Another fabulous valuation book is Damodaran on Valuation: Security Analysis for Investment and Corporate Finance
85 Broad Street, NY
A Goldman Sachs Office
- Equity Valuation: Models from Leading Investment Banks
- By Jan Viebig
- This book brings together expertise from UBS, Morgan Stanley, DWS Investment GmbH and Credit Suisse, providing a unique analysis of leading equity valuation models, from the very individuals who use them. Filled with real world insights, practical examples and theoretical approaches, the book will examine the strengths and weaknesses of some of the leading valuation approaches.
- Finance and Investment Handbook
- Applied Mergers and Acquisitions
- by Robert F. Bruner and Joseph Perella
- Wall Street Lingo
Job Search Success
Getting a job as an analyst isn't so easy and we have put together a number of resources that should be helpful to you as you contemplate entering the market. These include:
- After the Cataclysm: Finding an Investment Banking Job in 2010
- Getting in the Door
- Salaries for Bankers
- Facts & Advice About Investment Banking
- Job Market Outlook
- Job Listings
- Life as an Analyst
- Making a Trip to New York
Another important resource to have is access to specific contacts in the field. To ease this process we have assembled several lists that should be helpful to you. These lists cost $20 each and include:
- Top I-Bank Recruiter List - List of campus recruiters targeting undergraduates from the major investment banks. A big help given the competitive job season.
- Headhunter List - very helpful to have good access to executive recruiters
- Guide to boutique investment banks and recruiting contacts - good alternative to big firms
- Guide to Healthcare Investment Bankers - hot area
- Guide to investment bankers in restructuring and bankruptcy - another hot recruiting area