How To Become An Investment Banker | What is Investment Banking | Everything About Investment Banking | Investment Banking Overview ___________________________________________________________________________________________________ An investment bank is a financial services company or corporate division that engages in advisory-based financial transactions on behalf of individuals, corporations, and governments. Traditionally associated with corporate finance, such a bank might assist in raising financial capital by underwriting or acting as the client's agent in the issuance of securities. An investment bank may also assist companies involved in mergers and acquisitions (M&A) and provide ancillary services such as market making, trading of derivatives and equity securities, and FICC services (fixed income instruments, currencies, and commodities). Most investment banks maintain prime brokerage and asset management departments in conjunction with their investment research businesses. As an industry, it is broken up into the Bulge Bracket (upper tier), Middle Market (mid-level businesses), and boutique market (specialized businesses). Investment banking activities include underwriting new debt and equity securities for all types of corporations, aiding in the sale of securities, and helping to facilitate mergers and acquisitions, reorganizations, and broker trades for both institutions and private investors. Investment bankers help corporations, governments, and other groups plan and manage financial aspects of large projects. Many large investment banking systems are affiliated with or subsidiaries of larger banking institutions, and many have become household names, the largest being Goldman Sachs, Morgan Stanley, JPMorgan Chase, Bank of America Merrill Lynch, and Deutsche Bank. Broadly speaking, investment banks assist in large, complicated financial transactions. They may provide advice on how much a company is worth and how best to structure a deal if the investment banker’s client is considering an acquisition, merger, or sale. It may also include the issuing of securities as a means of raising money for the client groups and creating the documentation for the Securities and Exchange Commission necessary for a company to go public. Investment banks employ investment bankers who help corporations, governments, and other groups plan and manage large projects, saving their client time and money by identifying risks associated with the project before the client moves forward. In theory, investment bankers are experts who have their finger on the pulse of the current investing climate, so businesses and institutions turn to investment banks for advice on how best to plan their development, as investment bankers can tailor their recommendations to the present state of economic affairs. Essentially, investment banks serve as middlemen between a company and investors when the company wants to issue stock or bonds. The investment bank assists with pricing financial instruments to maximize revenue and with navigating regulatory requirements. Often, when a company holds its initial public offering (IPO), an investment bank will buy all or much of that company’s shares directly from the company. Subsequently, as a proxy for the company holding the IPO, the investment bank will sell the shares on the market. This makes things much easier for the company itself, as they effectively contract out the IPO to the investment bank. Moreover, the investment bank stands to make a profit, as it will generally price its shares at a markup from the price it initially paid. In doing so, it also takes on a substantial amount of risk. Though experienced analysts use their expertise to accurately price the stock as best they can, the investment bank can lose money on the deal if it turns out it has overvalued the stock, as in this case, it will often have to sell the stock for less than it initially paid for it. FinCradle FRM Structure Brochure - https://fincradle.com/contact-us For any Query/Doubts/Counseling - https://fincradle.com/contact-us To Order FinCradle's Pioneer Study Material ( Contain 2 Books - Study Book (Derived from GARP readings) and Question Bank (Combination of Bionic Turtle, Schweser and GARP previous Year Questions and 2 Mock Tests) - https://fincradle.com/contact-us Thanks For Watching :).... #investmentbanking #investmentbanker #investmentbankingindia