World of Finance:Internships
The range of career options in Finance is vast and the institutions vary enormously. In this section we will look at the broad overview of the options available. In addition to this advice, attend as many career events as possible and if you can, talk to friends working in finance – everybody likes talking about what they are doing.
Career options
Investment banks operate in increasingly diverse product areas and different institutions take on different work; so it is difficult to provide a blanket definition for what investment banks do. One thing is common - investment banks aim to raise money for companies, governments and themselves. Typical investment bank activities include:- Enabling clients (which can be companies, governments or individuals) to buy or sell securities (shares or bonds) in the financial markets
- Buying and selling securities on behalf of the bank itself – proprietary trading
- Assisting public and private companies raise funds in capital markets
- Offering strategic advice for companies, including advice on mergers and acquisitions
- Managing investment portfolios for respective clients
These activities are undertaken by different divisions within the bank.
Most Investment banks can be structured in terms of front and back office each with a different role to play and activities described below:
Front office:
- Financial markets: split into sales, trading and research - responsible for majority of revenue for most investment banks.
- Traders: buy or sell securities on behalf of clients or the bank itself
- Sales: connect buyers and sellers
- Research: research specific product areas
Traders, sales people and researchers can be defined according to the products they are involved with; equities, fixed income or foreign exchange for example (see jargon buster for definitions). Expect to make quick decisions and early mornings.
- Investment banking: advises companies, governments and institutions on strategic advice. Activities include advising clients how to raise capital and advice on mergers and acquisitions (M&A). Teams are typically sector specific; focusing on pharmaceuticals for example. Expect large amounts of analysis work and long hours.
- Investment management: Manages investment portfolios for investors which can be institutions or individuals.
Back office:
- Technology: Ensuring IT operations run smoothly throughout the bank. Roles include developing software for business needs, analysis work and technical support. Previous knowledge of programming applications is a bonus.
- Operations: A support division to the front office and ensures smooth running of the bank. Operations manages overall firms overall risk and ensures all trades are carried out and settled. Although operations don’t generate income for the bank it prevents losses. Strong analytical skills and being able to work in a team are a prerequisite.
Ok so you’ve got the broad picture and most banks will offer internship or graduate roles in these above areas. Be aware that there are other opportunities out there, such as private equity, prime brokerage and hedge funds for example; although these opportunities are often more applicable to people with 1 or 2 years experience and as such are beyond the scope of this site.
