Sell side investment banking interview

What is the most valuable lesson you have learned since coming out of school? There were only 3 out of 10 freshmen who made it through the program, and I was one of them. Q: Why do you want to work for Goldman Sachs? What is one skill that you think is most relevant to investment banking? What are some of the exit opportunities from banking? Can you think of a time when you came up with a creative solution to a difficult problem?

The sell-side

Breaking down which types of firms are considered «sell side» and which are «buy side». View Modeling Courses. You’ll often hear finance professionals describe their role as being either on the «sell side» or on the «buy. Sell side refers primarily to the investment banking industry. While we describe the various functions of the investment bank herewe can briefly outline its capital raising and secondary markets roles:. Those roles include:. The buy side broadly refers to money managers — also called institutional investors.

The buy side

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The sell-side

If you’re bankign here, please click here to get my FREE page investment banking recruiting guide — jnvestment, get weekly sife so that you can break into investment banking. Thanks for visiting! Ah, yes: that classic debate about the buy-side vs sell-side.

Although the conversation above is fictional, similar exchanges are taking place in cubicles across the world as you read. You hear about the buy-side vs sell-side distinction everywhere, whether you search online, browse through you message boards, or even gasp talk to people in real life.

On the buy-side, you raise capital from investors and then make your own decisions on where to invest it and what to buy. If Ari Gold is the sell-sideDana Gordon is the buy-side. To an outsider, this seems like a logical way to divide the industry: you earn money investtment via commissions on sales or by investing your own money and getting a return on that investment. Rather than this buy-side vs sell-side sidd, we should be talking about whether you work on deals siee in the public markets.

And when your work is finished, you go home. That may sound like a small deal, but in investment banking and private equity you often get pulled into work on weekends and late at night when major deals are happening. That issue with market hours vs unpredictable hours also means that the stress in each role is much different as. Traders, for example, need to watch their positions every second of the day and must find someone else to cover them if they leave for even a few minutes to run to the bathroom.

People like to claim that much of the work you do on Deals is mindless grunt work — which is not untrue — but you could say the same thing about intervview Public Markets role. This one is more about what you personally find interesting : do you actively follow the stock market and invest your own portfolio? The average pay on the buy-side vs sell-side is not that intervied different, but the ceiling on the buy-side is much higher. For example, banklng hedge fund managers could make hundreds of millions or even billions in a great year.

On the sell-side, meanwhile, the ceiling is much lower for Partners and Managing Directors. No matter how good you are, you have a sidde amount of time and you can only do so many deals or sell so many stocks in a day. You can see typical investment banker salary figures here ; private equity is not much different, and even sell side investment banking interview something less hierarchal such as trading, you see a similar progression from bottom to top. This is another one where the buy-side vs sell-side distinction seems sort of true at first… until you look at it in more.

So once again, the Deals vs Public Markets distinction is the best lens through which to view the hierarchies. You need more headcount on Deals because more work needs to get done and more people need to be managed: lawyers, accountants, financing teams from other banks, and even the occasional clueless consultant.

That difference in hierarchy also means that advancement differs in Deals roles and in Public Interfiew roles. But in Public Markets roles, advancement is more linked to your own performance, external factors like whether your Research Analyst is leavingyour reputation, and luck of the draw. So you could advance very quickly if you perform well and get lucky, or very slowly if you never do anything to set yourself apart.

But your sice opportunities depend on whether your a Deals person or Public Markets person, for the most. You knew we had to arrive at my favorite topic in the world ok, maybe ranking the banks is still sell side investment banking interview at some point, right? The main flaw with this Deals vs Public Markets distinction is that the pay differences are more strongly linked to the buy-side vs sell-side. But other than that, the key issues such as predictability of hours, the work itself and associated stress, and advancement all have less to do with buy-side vs sell-side and more to do with Deals vs Investmennt Markets.

The next time you hear people debating the buy-side vs sell-side or hyping up the buy-side, please punch them in the face and deliver a drop-kick or two. Investmnt his spare time, he enjoys memorizing obscure Excel functions, editing resumes, obsessing over TV shows, traveling like a drug dealer, and defeating Interviea.

Free Exclusive Report: page guide with the action plan you need to break into investment banking — how to tell your story, network, craft a winning resume, and dominate your interviews. Great post!!! Great article as usual.

I was wondering if you thought it may actually be easier to move from being a bankimg at a bank to working at a hedge fund either being a trader or analyst. Also, considering that many hedge fund managers started out as traders, I wonder if they might like traders better. Yes many investmemt from banks move to HFs. Some HF managers may prefer traders, and this is also based on performance.

Hi, what is the difference between buy-side research and working as an analyst at an asset management firm or hedge fund? In the article above, under the buy-side, buy-side research, asset management and hedge funds were all listed separately.

Hi Brian, Very insightful article thank srll for sharing and posting I inerview it interesting! Keep posting! Deals vs. Thank you for this article.

I have an interview with an alternative investment management firm for the position of a trader in the investment team Fixed Income Emerging Markets. I had two questions:. How do I tackle questions related to this during the interview? May I ask you a question? I have the CFA. Within the next 2 years I am going to need to switch to another geographical market, leaving all my clients behind, for family reasons. Any idea if this would be possible — ssell advisable?

There is a lot of insight inyerview truth regarding the myths and realities of the tenor of the buy and sell sides. But buy side and sell side terminology is vital for keeping us sane if we view it in the following way — this perspective was sort of overlooked here :.

So how can you trade? You pay a firm investmenf CAN get on the floor because they own a seat. Or they take your fee for the service of walking onto the floor selling your security, and returning, hopefully, with a fist full of your investment dollars.

The sell side trader is selling you access to the floor, you are buying access to the floor he is sell side, you are buy. It has nothing to do with abnking pitching investemnt particular stock. It has to do with buying the service he provides — access. Electronic trading can be considered the sell side, because you are paying for the same access to the trading floor. Investors either pay money for their presumed expertise or it is given away as a freebie if the volume of your trading activity is sufficiently exciting to the firm as a revenue stream in and of.

Imagine you are a private company and you want to go public. Not only that, but you have no idea how to connect with investors who would buy it out of the gate or even down the road.

Securities are not just structured and left at bakning — someone has to distribute it for you. You are the buy side because you are essentially renting the expertise of investment bankers. They will tell you all about the docs, they will tell you how to structure shares, and THEN they will walk over to their capital markets people, sales, traders. The Fundamentals course will still be helpful and specifically the Bonus Case Studies included within not yet even mentioned on the promotional pages will be helpful.

We give an exact template for a detailed stock pitch plus cover how to project revenue and expenses for different companies, which is what you do in ER. If so, are there bankijg asset classes where agency trading is still done by humans instead of computers? How easy will it be for me to move to a hedge fund as a prop trader after few yrs? Most 3. Depends on how good you are. Harder to obtain that in PE firms esp cause they are small and expect candidates to be up and running ASAP Investmemt on what kind of person you srll — if invextment can be up and running when they hire you and have a genuine passion in PE, I think going straight into it is a more direct way.

Thanks so much for the advice! Just to follow through, would 1 year in I-banking be enough to invewtment PE? Or do I have to do 2 or 3 years? Just to add here, many people at top banks actually interview for PE and land offers before year 1 ends, and then start after 2 years. Probably gets inevstment important as you advance. Even if they keep records, they might not remember. Just apply now and see where it leads you. I know that finance certainly does the first one.

However, is there any room to do the second? In the end, does corporate finance really add value in the majority of cases? Money can do society good; it depends on how you use it 2. Yes, corporate finance, like any other business, can add or not add value depending on how you see it and who is doing the deal. You have to look at the context before you make investent statement. Intervew are the exit opps for Public Markets?

In deals it seems pretty clear that you go into corporate development or business development. What do you do then? IMO comps with 1 or 2 yr forecasted 3-statements is the most accurate. How many hours each week are invesment in order to do the job? I met a PhD student on campus randomly, she happens to know a few quite established bankers for some reason.

How should I follow up on her? Should I send her an email baanking directly ask for referrals? A bit unrelated, but would an internship with a tax accounting firm that does tax returns and other accounting work for PE firms look good on bankinng resume for investment banking?

Once again, another great article that structures knowledge of what one doing. Yeah in general it is more difficult because most people only do the reverse.

This is arguably more important than the work you do in preparation for an investment.

The buy side

In the long term, if the opportunity arises, I would continue working with JPMorgan and contributing to its growth and success. NOTE: The best way to answer this is give specific examples of times where you demonstrated attention to intervieq, willingness to work harder than everyone else, or a intrrview when you helped add value to the group. Join Us. Are they looking to overtake Goldman or Morgan Stanley in some area, or are they content with simply doing business the way they have? Q: How was your internship experience at Barclays? How do you come to that estimate? NOTE: Always have at least two questions prepared per bank. These questions are important because it shows the banker your interest not only in the sell side investment banking interview, but also in the conversation with the interviewer. Another possibility : One concern I have about investment banking is the balance between work life and family life. Q: What is a fairness opinion? Q: Did you receive an offer from your previous internship? I helped to solve the problem by helping him discover his strength and intefview him focus on his strengths while the others helped to fill the gap. You’re also creating a new problem: since your answer is so detailed and reads more like a grocery list than an answer, the interviewer will now focus entirely on whether or not you missed a step, as opposed to holistically evaluating your response. What were your grades in college? Its much appreciated. What other firms are you interviewing with and why?