How Do I Become an Investment Banking Analyst?

If you have excellent mathematics and analytical skills, you might be wondering how to become an investment banking analyst. Investment banking is the discipline of finance that relates to investing money, often on behalf of clients. Like other types of financial analysts, investment banking analysts gather data, evaluate the possible outcomes of various investments, and advise clients on which investments are likely to be the most profitable.

Investment banking analysts most often work within investment banking companies. They interpret data such as financial statements and devise plans for smart investments. Though it may sound fun to spend other people’s money, investment banking is a serious business. Research is a huge part of an investment banking analyst’s duties. They must remain constantly well-informed on current economic and business trends and may be called on to do firsthand research. Part of making the best possible investment decisions is understanding relevant historical events and using that data to predict future financial trends.

Solid communication skills are essential for investment banking analysts. These analysts develop and pitch proposals and write publications intended to educate clients. An investment banking analyst must be able to precisely explain to clients why they recommend making certain investments.

A formal education is necessary for aspiring investment banking analysts to learn the required skills. Candidates should first pursue a bachelor’s degree in finance, accounting, business administration or another relevant major from a respected school. Because computers are used so extensively in the field of investment banking, students should also develop essential computer skills, either through formal education, through work experience or on their own time. Internships are an excellent way to gain the real-world experience necessary to secure a job in this competitive field. Students who maintain superior grades during their studies or pursue advanced degrees, like an MBA, may have an advantage when seeking their first investment banking analyst job. Once hired, candidates often continue to receive on-the-job training as they gain experience during their first few years of work. As with other types of financial analysts, investment banking analysts may need to seek licensure from the Financial Industry Regulatory Authority and achieve certification, such as the Chartered Financial Analyst certification from the CFA Institute.

Though investment banking can be high-stress, it can also be high-paying and have great job security. Finance is a rapidly growing field. The U.S. Bureau of Labor Statistics anticipates job opportunities for financial advisors of all types to increase by 23 percent by the year 2020, which is a significantly higher rate of growth than the 14 percent rate predicted for all occupations. Job search website lists the average salary for investment banking analysts as $97,000, an amount well over the median salary for all occupations, which the Bureau of Labor Statistics reports is only $33,840 per year. If you have an analytical nature and mathematics skills, knowing how to become an investment banking analyst may be the start to an exhilarating, lucrative new career.

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