Posted by: Kaplan Schweser
Updated: August 6, 2020
The pathway to a career in investment banking most commonly begins with a position as an investment banking analyst. The job is intense and requires that you be able to multi-task, pay exquisite attention to detail, think on your feet, and bid farewell to a traditional work-life balance. The rewards, however, are worth the sacrifice to those who dream of the investment banking career and lifestyle. You’d be hard pressed to find a better paying entry-level job after college. Landing and succeeding as an analyst in investment banking position is your key to bigger and better opportunities throughout your finance career.
So how do you make it happen? The detailed steps below cover the most common moves individuals take to secure a position as an investment banking analyst at a top bank. While we’ve organized the steps sequentially, this isn’t necessarily a linear process. For instance, networking is a skill you will need to begin developing as an undergraduate student and continue honing throughout your career. But each of these steps can be critical to you achieving your ultimate goal of a job as an investment banking analyst.
The first step toward becoming an analyst in investment banking is completing your undergraduate degree. Common majors for future analysts include accounting, finance, and math. But it’s not incredibly uncommon to see analysts come from other majors and still be successful in investment banking.
All of your opportunities will likely come because someone was aware of you, your skills, and your experience. Two great ways to make you and your abilities more visible are through networking and internships.
As previously mentioned, networking is not just a skill for securing your first job. Networking is a critical career-long skill that will often open doors you might not have known even existed. Early on, it can be intimidating and possibly uncomfortable. Still, you have to continue to pursue networking opportunities in order to get better at it, because you will absolutely need it throughout your career.
Internships have several advantages. First and foremost, internships provide you with real-world practical experience. Immersion is truly the best way to learn and become acclimated to the life of an investment banking analyst. Secondly, you will build practical experience and skills that make you more attractive as an employee when it comes time to apply for jobs. It’s also valuable to think of your internship like a long-form job interview. Investment banking interns often earn the opportunity to be considered for a position as an analyst after graduation, based on the great work they did during their internship. Finally, internships provide a valuable environment to make a connection and build your network. It may lead to future opportunities in the firm where you’re interning; or it could lead elsewhere, as the people you work with in your internship move on to other banks.
In order to operate as an investment banking analyst, you are required to register as a representative of your bank with the Financial Industry Regulatory Authority (commonly called FINRA). In addition, depending on the type of work you will be doing, you need to prepare for and pass any applicable securities (series) licensing exams to qualify for registration.
While not required, it’s quite common for prospective investment banking analysts to start the Chartered Financial Analyst® (CFA®) Program while they are still in school, or soon after they graduate. The CFA charter is globally recognized as the most respected investment management designation you can earn. The program focuses heavily on investment valuation, company analysis, and portfolio management. Earning the CFA charter requires you to pass three levels of exams. This process typically takes several years, since the exams are only offered once per year (aside from Level I, which is offered twice per year) and candidates study an average of 300 hours per level. In order to earn the charter, you must also demonstrate that you’ve logged 4000 hours of applicable investment work experience. But you don’t need any experience to start, so it’s common for individuals to complete the examinations while earning their required experience.
The job hunt is where you reap the benefits of that network you’ve been building. It’s important to remember that networking is a two-way street, and the universe isn’t waiting to help you find a job. When you identify opportunities to introduce colleagues to someone who could help them in their career, do it! Go into every networking relationship proactively looking for ways to help other people. Doing so increases the likelihood that your name gets remembered and brought up when the right opportunity arises…and it puts you in a great spot to capitalize on it.