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How to Become an Investment Banker: The Ultimate Guide

03 February 2022

How to Become an Investment Banker: The Ultimate Guide

Contents

Thinking about a career in investment banking? 

You’ve come to the right place. 

In this article we’ll take a detailed look at how you can secure a successful investment banking career: what A-level subjects you’ll need, work experience, undergraduate degree choices, career progression and more!

Plus, tips on what you can be doing to prepare for a career in finance now. 

Careers in Finance

From financial planning to fintech, there’s a wealth of varied career opportunities in finance.  

Investment banking is one of the most popular paths, in large part owing to the prestige and high salaries associated with the career. 

So, how can you stand out as you aim to break into investment banking? And what are the different roles you can pursue within the field? 

To help you answer these questions, let’s first take a quick look at investment banking as a profession and the factors you’ll need to consider as you plan for your future career. 

There’s a bit more to it than stocks, shares and skyscrapers…

What is an Investment Bank? 


An investment bank provides various financial services to corporations, governments, institutions or high net-worth individuals. 

There are several different kinds of banks where investment bankers might work, including international investment banks (the most profitable of which are known as bulge bracket banks), such as J.P. Morgan or Goldman Sachs, and boutique investment banks, such as Lazard or Guggenheim Partners, which tend to work on smaller deals and specialise in particular areas within investment banking. 

Roles Within Investment Banking 


If you want to become an investment banker, there are 2 pathways you can go down.

Lifepath 1: Sales, Trading and Research

The sales, trading and equity research pathway encompasses all roles on the trading floor. 

Think The Big Short or Wall Street: Money Never Sleeps.

Salespeople call potential investors to suggest companies that they might want to invest in. 

A financial trader buys and sells shares, bonds and assets on behalf of their clients, setting prices and making trades to try and maximise profit. 

Those who work in equity research analyse trends, produce reports and, on the basis of this research, recommend companies for clients to invest in. 

Whichever role you choose, you will specialise in a particular market area. For example:

  • Consumer and retail 
  • Energy and utilities
  • Healthcare
  • TMT (technology, media and telecom)


Lifepath 2: Corporate Finance 

In corporate finance, bankers act as financial advisors/managers to a range of different clients, including corporations, governments and other institutions.

If you choose to go in this direction, there are several different teams you might work in, including: 

Within these teams you will specialise in a certain business area, as above. A few more examples include: 

  • Real estate
  • Media and entertainment 
  • Technology
  • Natural Resources (chemicals, metals, paper, etc.)

Investment bankers working in corporate finance provide a range of financial services to their clients to help them raise capital (i.e. make money). 

Examples of these services include: 

  • Executing a merger (the merging of 2 companies under a new name, e.g. when Orange and T-Mobile merged to become EE) or an acquisition (when one company acquires another company, e.g. when Disney acquired Pixar)
  • IPOs (initial public offerings: helping a company raise money by listing on the stock exchange and offering up its shares for the public to invest in)

Some of these things can be difficult to understand before you enter the field, but you don’t have to worry about them too much now. 

What’s more important is that you have a general idea of the different directions you can go in, as well as the skills and qualifications required for each role.

The financial payoff is a big incentive for many investment bankers. A first-year analyst can expect a starting salary of at least £60,000 (a senior position promises upwards of £120,000), and annual bonuses can reach huge sums.

Career Progression


Your investment banking career might vary slightly depending which route you decide to go down, but generally you can expect to move through the following stages as you advance: 

  • Analyst - your first role in the industry once you graduate university, this is the most junior position at an investment bank.
  • Associate - after about 2-3 years as an analyst, bankers can expect to be promoted to associate level, where they will usually work for another 3 years. 
  • Vice President - the VP position acts as a sort of bridge between junior and senior levels. How long you spend as a VP can vary depending on which business area you work in. Generally, it’s at least 3 years. 
  • Director - the penultimate stage before you reach the top level - it’s supposed to be 2 years before you progress to MD, though it can take longer. 
  • Managing Director - the highest position at an investment bank. 


Click here to find out more about the responsibilities, hours and salary of each role

How to Become an Investment Banker in the UK


Is Investment Banking for me? 


Investment Banking is a lucrative and high-powered career choice with good bonuses and plenty of corporate perks. 

But it can be a demanding profession. 

Long hours come with the territory. Work days can last 12 or more depending on the role you choose, with weekend work often expected during busy periods. Even outside of working hours you’ll be expected to be reachable; achieving a work-life balance can be tough - particularly in your first few years!

But the financial payoff is a big incentive for many investment bankers.

A first-year analyst can expect a starting salary of at least £60,000 (a senior position promises upwards of £120,000), and annual bonuses can reach huge sums. Click here for a breakdown of the salaries offered by each London bank as of 2021

There are other perks, too: international travel, subsidised meals, gym memberships and an excellent pension among them.

If these things are strong motivators for you and you thrive in a fast-paced, high-stakes environment, read on. 

What A-levels do you need to be an Investment Banker? 


There are no mandatory A-level subjects you need to take to become an investment banker, but there are certain subjects that will help prepare you for the industry, and others that are respected within the profession.

Maths, economics, further maths, accounting and business studies will give you a good foundation from which to build your skillset at undergraduate level. Maths, in particular, is a strong academic A-level looked on favourably by universities and employers.

Other useful A-levels include physics, chemistry, biology, English, history, geography and languages.

These subjects are often listed as the ones most likely to get you onto a good degree course. Not only will they help keep a wider range of universities open to you (in case you decide against investment banking later), they will also provide you with excellent transferable skills (e.g. communication) to complement maths, economics and business-related subjects. 

For more advice on how to choose the right A-level subjects for you, check out our blog: What A-Levels Should I Take? Ultimate Guide

As finance is such a competitive industry, it’s important that you achieve a strong set of results. Think about which subjects you have a good chance of doing well in and keep in mind that you'll be much more motivated to study subjects you enjoy. It’s all about striking a balance! 

Here’s what Erika Terrones Shibuya, an associate on the Asia Equities sales desk at Goldman Sachs and a speaker on our Investment Banker Programmes, had to say about her choices:  

“I did the International Baccalaureate Diploma program in Singapore and took French, English and Economics as my Higher Level subjects. For my standard level subjects I took Math, Physics and Business & Management. The most important for me was Economics as I did my extended essay in it (equivalent to a high school thesis). I enjoyed following current affairs and geopolitical issues; I studied economics so I would have the analytical tools to better understand them.”

Want to hear more from Erika? Take a look at our blog: A Day in the Life of an Investment Banker

Investment Banking Work Experience 


Work experience will become more important once you get to university, when you can start applying for spring weeks and summer internships. But a couple of weeks’ experience in a relevant field before you leave school will really help impress future employers, and demonstrate your dedication to the field. 

Many of the big investment banks, including J.P. Morgan, HSBC and Credit Suisse, offer formal work experience placements for GCSE and A-level students. Have a look online for programmes you’re eligible for. 

There are also several schemes in place for students from underrepresented backgrounds. Morgan Stanley, for example, has a scheme called Step in Step Up that is aimed at female candidates, and Credit Suisse runs a Steps to Success university scholarship programme for underrepresented students who’ve just finished year 13.

Keep in mind that a scheme with any of the big financial institutions is going to be highly competitive. You’ll need to put together a very strong application. 

If you’re looking for an alternative option, InvestIN’s Investment Banking Programmes offer you the chance to get invaluable industry experience without going through a rigorous application process. Compete to trade currencies, stock and commodities and negotiate a live deal under mounting pressure! Plus, get detailed advice on how to break into finance from top investment bankers. There is no application process but places are limited, so book early to avoid disappointment.

Though there is no fixed skill set necessary for the industry, there are definitely certain characteristics that will help you excel. These include excellent time management, being able to synthesise complex issues quickly and being able to think on the spot.

Which Skills are Required by Investment Banks?


Your first job in finance will provide you with all the training you’ll need to do your day-to-day work, as well as a commercial awareness of how the industry works. But there are a number of complimentary employability skills that will really help you excel in your role, including: 

  • Numerical skills 
  • Analytical skills
  • Communication
  • Time management
  • Teamwork
  • Leadership 
  • Diligence 
  • Confidence (a strong belief in yourself and the ability to make high-stakes decisions)
  • The ability to handle pressure

“Being able to connect with people is essential. The most exceptional people I have seen in the industry are not only very knowledgeable in their area of expertise, but are also able to communicate extremely well. This is not just limited to presenting ideas to an audience, but also listening to people.”

Erika Terrones-Shibuya, Associate, Asia Equities Sales at Goldman Sachs

How You Can Start Developing These Key Skills Now


It’s a good idea to start building these skills whilst you’re still at school. There are several ways you can do this: 

  • Subject choices - even though there are no mandatory subjects required to become an investment banker, choosing your GCSE and A-levels thoughtfully will help you to start building the skills you’ll need in your future career. English, for example, will help improve your communication, whilst maths will give you key numerical and analytical skills. Give some thought to the areas you want to improve before you make your subject choices. 
  • Extracurriculars - clubs, societies and out-of-school hobbies offer the perfect opportunity to start building important soft skills, as well as demonstrate to future employees that you are a proactive, well-rounded candidate with a wide range of interests. Sports teams are a great place to improve your teamwork. Editing the school newspaper could help you improve your organisation, time management and leadership skills. Drama, debating or extracurricular language clubs could help you hone your communication, whilst choding, chess or competitive maths leagues will help improve your numeracy and analytical skills. Explore what’s on offer at school and in the local area. 
  • Part-time work - getting a part-time job is an excellent way to build valuable skills. A hospitality role in a busy restaurant will give you experience of a high-pressure working environment and allow you to develop your people skills. A tutoring job could help you improve your communication and, if you’re tutoring maths, solidify your understanding of mathematical principles. Looking for tips on how to apply for your first job? Check out our blog: How to Write a CV with no Experience
  • Volunteering - volunteering is a great way to get involved in the local community whilst developing essential employability skills. Certain roles might help you work on your teamwork, communication or organisation. Others may help demonstrate your commitment, reliability, or ability to handle stressful situations to future employers. There are all sorts of different things you could do. Why not try working in a charity shop, serving meals to the local homeless community, volunteering at an animal shelter or befriending an older person to help combat loneliness? Have a look online to see what opportunities are available in your area. 

“I was always very busy with a wide range of extracurriculars. I did Model United Nations, volleyball, European Society, volunteering with the Singapore Red Cross... Potential employers will look at the skills you’ve acquired through these kinds of activities: teamwork, analytical skills, leadership, presentation, debate, stakeholder management, accounting..”

Erika Terrones-Shubiya, Associate at Goldman Sachs.

What’s the Best Degree for Investment Banking? 


You do not need to study finance, economics, business studies or maths to become an investment banker, though these subjects will undoubtedly equip you with a good knowledge base and a relevant skill set. 

Investment banks have been known to take candidates from a wide range of disciplines, from physics to politics, computer science to French. 

If you’re wondering which direction to go in, consider the following: 

  • What subject interests you the most. It goes without saying that you’ll get much more out of your education if you study something you love. You’ll also be much more motivated to put the work in, and therefore more likely to achieve those top grades. 
  • What you’re best at. Finance is an intensely competitive field, and investment banks seek candidates with an exemplary academic record. Play to your strengths. Don’t be tempted to take maths just because you think that’s what the big banks are looking for if there’s another subject you enjoy more that you’re better at. 
  • What path you want to go down. Deciding early whether you want to go into corporate finance or sales and trading can help you decide what degree will best equip you with the skills you’ll need. Sales and trading roles will require the use of basic maths skills on a regular basis, whereas corporate finance tends to involve more client-facing work. Humanities subjects, which would help you develop your communication and interpersonal skills, could be more useful in this case. 

Whatever degree and university you choose, you will need at least a 2:1, and a really strong academic record will help set you apart from other qualified candidates.

What University Should You Go To if You Want to Be an Investment Banker? 


In reality, it’s the university that carries more weight with investment banks than the course. 

Though it’s not officially advertised, it is generally understood that high-ranking universities like Oxford, Cambridge, LSE, UCL, Imperial College London and Warwick are favoured by the big banks. Aiming for one of these universities will stand you in good stead. 

It’s not just their prestigious name that’s likely to work in your favour. These are the universities most targeted by top investment banks, so you’re more likely to come face to face with their representatives at careers fairs, workshops and recruitment events. 

Having said this, banks are said to be expanding their field of recruitment to include universities like King’s College London, Durham, Bristol, Exeter, Nottingham and Manchester.  

When making your choices, aim for Russell Group universities if you can, and focus on getting the best possible grades when you’re there. Whatever degree and university you choose, you will need at least a 2:1, and a really strong academic record will help set you apart from other qualified candidates. 

Using Your Time at University to Prepare for Success


Once you’re at university, there are several things you can do to up your chances of success when it comes to applying for jobs. 

Join Relevant Clubs and Societies 


Finance or business-related clubs and societies are a good way to demonstrate your commitment to the profession to future employers. They also provide an excellent talking point for interviews. 

Have a look on your university website or inquire at the students’ union to see what’s on offer. 

From Economics and Finance to Fintech, Women in Finance to Value Investing, you’re bound to find an organisation to interest you. 

Can’t find exactly what you’re looking for? Start your own!

Founding a club or society - or acting as president, secretary or treasurer - will show true passion and help you develop essential leadership skills. 

Plus, if you’re more heavily involved in the organisational side of things, it might put you in the way of new contacts, particularly if you organise events with high-profile speakers. 

Apply for Spring Weeks


Spring weeks (sometimes called insight weeks) are week-long work experience placements hosted by investment banks for 1st year university students.

They take place over the Easter holidays and are designed to give aspiring bankers an overview of the bank’s inner workings and an insight into the industry in general. 

As they are so much shorter, a spring week is less rigorous than a full internship. But it is nonetheless a great way to gain invaluable experience, boost your CV and start building your professional network. It can also make your chances of securing an internship easier: spring week attendees with a certain bank can have their internship applications fast tracked. 

Apply as early as you can: applications are usually considered on a first-come-first-served basis. 

Get an Internship 


As banking is so competitive, it’s really important that you try and get as much experience as possible before you finish university. That means applying for internships. 

Almost all of the big banks - Goldman Sachs, Citi, Barclays, J.P. Morgan, Morgan Stanley, Deutsche Bank, etc - run paid internship schemes. They usually take place in the summer (though some will accept applicants on a rolling basis throughout the year) and last about 8-12 weeks. You will usually undertake them in the summer of your penultimate year (though there are some available for 1st and 3rd year students). 

Each programme starts with in-depth training - so you don’t have to worry if you don’t have any experience - and are designed to help you get a feel for the profession and start building your knowledge of the field. They also provide an excellent opportunity for you to explore which bank, division, business area or product you might want to pursue after graduating. 

On the Barclays Analyst Summer Intern Programme, for example:

You’ll start with training, after which you’ll join a team focused on a key industry, product or region. You’ll work on live deals and deal proposals, learn how to put together new business presentations and discover the art of executing transactions.

On Morgan Stanley’s Investment Banking Summer Analyst Programme, you’ll get the opportunity to:

…experience the culture and atmosphere of Morgan Stanley's Investment Banking Division taking on some of the responsibilities and functions of a Full-time Analyst for the summer period. Summer Analysts are assigned to a specific group in IBD, building basic skills in financial analysis, accounting and valuation, while working on a wide range of domestic and international transactions. Training begins in June with one week of intensive classroom training. This will include an introduction to Morgan Stanley, followed by division-specific training. Throughout the internship, you will be exposed to business speakers, practical sessions and have the opportunity to exchange ideas and learn from your peers through various social activities and events.

An internship could be your ticket into banking. Many banks invite the most high-performing interns to become full time employees after graduation. 

Do your research into which opportunities are available as early as possible and apply for as many as you can. 

You might want to consider making a spreadsheet or document detailing which internships you want to apply to, when you’ll be eligible, when and where they take place and the deadline for applications. Applications tend to open at the beginning of the school year; some close by November, others as late as March. It’s a good idea to keep track of individual application dates with different banks to ensure you don’t miss any!

Network, Network, Network


Breaking into the field will be a lot easier with a few industry contacts. 

Professional connections can point you in the direction of new opportunities you may not have heard of, offer advice and insight from within the industry and even provide moral support. 

The idea of networking can have negative connotations for some people, but try not to overthink it. It’s really no more than introducing yourself to people, starting conversations and making friends! 

Don’t think of it as a means to an end, think of it as an opportunity to ask questions, express interest and seek advice from people who are knowledgeable about your area of interest. 

There are plenty of ways you can start building your network as a student. 

Attend networking sessions, careers fairs and other events hosted by your university and be sure to make the most of the resources offered by the uni careers service. You can also research industry events you might be able to attend. 

If you’re part of a finance-related club or society, connect with as many people as you can. Reach out to professionals to see if they can speak at an event you’re hosting, sit on a panel, or attend a mixer. Make time for other society-members, too - they may be your future colleagues!

If you secure an internship or work experience scheme, put time into building genuine relationships with the people around you, and be sure to get their contact details so you can stay in touch.  

You can also use social media to your advantage. LinkedIn is a great tool: use it to follow professionals and companies you admire, connect with colleagues, teachers and fellow students, stay up to date on industry news by reading blogs and articles and search for relevant events and job opportunities. 

You can use extracurriculars, volunteering and part-time work to gain important knowledge and experience whilst still at school. They don’t have to be finance related. It could be team sports, playing an instrument…anything you’re passionate about!

You could also try… 
 

  • Investing! What better way to get a feel for the industry than to try investing yourself? You don’t need lots of money - you can invest with as little as a pound. Start by thinking about your financial goals and doing a little research. HSBC’s Beginners' Guide to Investing is a good place to start.
  • Starting your own business. Starting your own small business is a good way to show initiative and demonstrate the business acumen that big banks are looking for. It could be something as simple as a tutoring service or IT support.   
  • Learning another language. A foreign language is listed as a desirable asset for certain roles, particularly if you’re going to be working with clients overseas. 
  • Studying abroad. Many investment banks operate internationally, and value a global outlook in their employees. Studying abroad is a great way to expand your understanding of other cultures. 

What You Can be Doing Now to Prepare for a Career in Finance

A lot of the preparation for your first role in finance will start once you get to university. But there are several things you can start doing now to give yourself the best chances of success.

  • Do your research. Investment banking can be tricky to break into. Take the time to research the profession and explore which avenue you might want to go down once you enter the field. Knowing what to expect will help you prepare to the best of your abilities. Guides like this one are a good place to start, and you can find further resources at:
  • Study hard. Investment banks are inundated with applications from talented, qualified candidates every year. If you want to stand out among them, you’ll need an exemplary academic record. Make sure you put the time into your studies to achieve a really strong set of results! Check out our blog, How to Motivate Yourself to Study in 7 Easy Steps, for plenty of practical study tips. 
  • Start building your professional network. It’s never too early to start building a professional network. Of course, you’re less likely to come across professionals whilst you’re still at school, but there are ways. InvestIN can help: on our programmes you will get the opportunity to network with top investment bankers, as well as like-minded students. Use these experiences to forge new connections, then make a LinkedIn profile to keep in touch with relevant contacts. 
  • Up your skills. Focus on building the key skills essential to the profession. You can use extracurriculars, volunteering and part-time work to gain important knowledge and experience whilst still at school. They don’t have to be finance related. It could be team sports, playing an instrument, helping out at a youth club - anything you’re passionate about! Employers want to see that you’re a well-rounded candidate with a diverse range of experience, and hobbies make great talking points in interviews.
  • Gain valuable experience. Find relevant work experience if you can. If you’re struggling to secure finance-specific experience, search for something in a related field, or find a placement where you’ll be able to practise some of the key skills essential to the profession. InvestIN’s Investment Banker Programmes give you the chance to gain hands-on experience before university. Meet and learn from top investment bankers as they guide you through a series of interactive career simulations, inspiring site visits and Q&A panels. Book now, no questions asked!


And finally… 


Good luck!

We hope you found this guide useful and you have everything you need to kickstart your career in finance now.

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