There are many different branches of investment banking, each with its own focus. The sales & trading group matches sellers and buyers of securities in the secondary market and may trade the firm’s own capital. The equity research group conducts research and analysis to support trading of stocks and helps investors make investment decisions. Asset management is the process of managing investment portfolios for both individual and institutional investors. Each branch has its own sales force and Managing directors, but there are many similarities.
Managing directors
Many analysts never make it to the coveted managing director’s office. Family responsibilities, aging parents, or health problems keep them away from the job. As a result, many choose to leave investment banking altogether. Others simply have too many ambitions and don’t have the right attitude. Whatever the reason, a career as a managing director in an investment bank is worth striving for. Listed below are some traits of a successful managing director.
Managing directors typically oversee teams of analysts, associates, and vice presidents and report directly to the CEO, CFO, or CRO. The responsibilities of a managing director are varied, ranging from overseeing the day-to-day operations of their group to bringing in new clients. Many also travel a great deal and report directly to their C-suite. If you’re interested in becoming a managing director, you should be well-versed in the ins and outs of the investment banking world.
Managing directors have a great deal of authority, and few will ultimately be groomed to take on the leadership role of their firms. However, there are many exit opportunities for Managing Directors, including running their own buy-side firm or being a part of the management team of a publicly listed company. There’s also plenty of room for creativity. With this kind of responsibility, there’s no better time than now to pursue a career in investment banking.
Research divisions
Investment banks typically have a number of research divisions, namely Equity, Credit, and Macro Research. The Macro Research division keeps track of macroeconomic developments and other metrics in various countries, and the Equity Research team researches stocks, advising investors on whether or not to buy or sell. Equity Research also produces reports on securities and often includes a buy or sell recommendation and price target. Investment banking companies also hire analysts to help with research and analysis.
The Investment Banking division is often organized by product or industry. The Product Groups focus on particular deal types and maintain relationships with companies within that industry. Meanwhile, the Industry Groups focus on specific industries. Some of the most important trade associations are the Securities Industry and Financial Markets Association (SIFMA). Smaller firms may belong to the American Bankers Association or the National Investment Banking Organization. Further, the Research Divisions may be organized into regional or national teams.
For those with experience in quantitative analysis, equity research analysts are well-paid compared to equity research associates, with bonus rates ranging from 10 to 50 percent higher. Moreover, equity research associates usually have to work 12-hour days, with many busy times such as earnings season. Investment banking is notoriously stressful, with analysts working 90 to 100-hour weeks during peak trading and earnings season. The salary for equity research associates, however, is higher.
Sales force
Whether your firm has hundreds of employees or a small team of investment banking professionals, Salesforce solutions can help your team work faster and smarter. The solution allows your investment banking team to track and share perpetual data with relevant stakeholders. For example, a banker working on a complex M&A deal could use Salesforce to ensure that colleagues trading related stocks do not see private information related to the deal. Salesforce solutions also help investment bankers better understand their clients and identify new prospects.
Whether your bank has a traditional client base or a diverse set of prospects, it is essential to have a sales process and approach in place. As market conditions worsen, you will need to focus on generating growth and finding new sources of revenue. A sales force can help your bank grow and make the right decisions at the right time. With Salesforce Financial Services Cloud, you’ll have a unified view of client data, improve the quality of your client relationships, and save money in the process.
Salesforce has also been proven to be useful across industries, including investment banking. The company has even launched a financial services cloud solution to help modern financial service firms deepen customer relationships. In the investment banking industry, Salesforce has a thriving CRM program and has recently increased its price target from $285 to $290. Analyst Matthew Hedberg has increased his price target on the stock, believing that the company is wellpositioned to drive robust growth and achieve long-term targets.