Sudeep Paul

Jyoti Joshi

October 24,
2007
Agenda
Working on Wall Street
Areas of an Investment Bank
The Buy Side
 The Wall Street Hiring Process
Skills/Tips
Our Background
Sudeep Paul
Double Degree in Business (Finance) and
Economics
Senior Advisor of UFA
Email: sudeepp@andrew.cmu.edu
Cell: 516-582-7759

Jyoti Joshi
Major in Business (Finance)
President of UFA
Email: jjoshi@andrew.cmu.edu
Cell: 908-868-4504
Why do people want to work on Wall
Street?
Intelligence is Highly Valued
Positives of working on Wall
Street
Money
Prestige
Power
Challenging work environment
Work with smart people
Chance to meet the top people at interesting
companies
Large amount of learning
You are paid based on your personal performance
Rapid advancement opportunities
Great business credential to have for future jobs
and graduate educational opportunities
Negatives of working on Wall
Street
Long Hours = Falling Asleep all the Time
Negatives of working on Wall
Street
Long hours
Sometimes tedious work – lower levels
“Up or out environment”
High Pressure
Work/Life Balance – limited social/family
life
Belittlement at the lower levels
Opportunities tied to overall economy
(strong swings in hiring based on macro-
environment)
Can be cut-throat depending on the
situation
Words You May Have Heard
Before
Sell Side Buy Side
Investment Banking Asset Management
Commercial Banking Mutual/Hedge/Pension
Capital Markets Funds
Sales & Trading Stock Broker
Traders Equity
Analysts Debt/Fixed Income
MD (Managing Institutional
Director) Retail
 Who are the Big
Players?
The Old Guard The New
Merrill Lynch Players
Goldman Sachs Barclays Capital
Morgan Stanley Bear Stearns
Lehman Brothers Deutsche Bank
JP Morgan CSFB (Credit
Citi Suisse)
UBS Wachovia
HSBC
 The Structure of an I-
Bank
Investment Bank- 3 main functions
 CM: Help customers raise money in markets
 IB: Advise companies on mergers and acquisitions
 AM: Management of securities and assets (buy side)
An investment bank vs. investment banking

Capital Markets Investment Banking

Sales/Trading/Research Mergers & Acquisitions
Structure & Origination Corporate Finance

Asset Management
Institutional Investors
Private Investors (Retail)
 Capital
Markets
Capital Markets

Equities (Stocks) Fixed Income (Bonds)

Sales Trading Bonds Rates Derivatives

Research Credit Mortgages Real Estate

Foreign Exchange (FX)

Capital Markets
Sales and Trading
Both equity and debt- interact with both
markets
Trade and sell securities, derivative products
Equity Division deals only with stock markets
Fixed Income Division deals only with the debt,
currency, and commodity markets

Research
Equity Research
Fixed Income Research
Capital Markets
Structuring & Origination
Supports Sales & Trading in Capital Markets
(for both debt and equity)
Create new products to fit needs of corporate
or individual clients
Create products to customize risk exposure
Can create products that have both equity and
debt components (called hybrid products)
Structure IPO’s and secondary offers (for
banking)
Trading Floor
 Investment
Banking
Investment Banking

Raise Money M&A Corporate Finance

Initial Public Offering (IPO) Mergers Corporate Decisions

Secondary offering Acquisitions Increase Return

Investment Banking
Unlike a commercial bank, has no pile of cash
A company comes to an I-bank for advice, for capital
(cash), and other special financing needs
Mergers and Acquisitions
 Help companies merge/acquire others

Corporate Finance
 Goal: enhance corporate return while decreasing the
firm’s risk
 Divided into short-term and long-term decisions

IPOs/Secondary offerings
 Goal: to help companies raise money
 IPO: Initial Public Offering
 Secondary offering in the “after market” – debt or
Asset Management
A part of the buy side, but many firms have
both sell and buy side components

Institutional Investors
Mutual, Hedge, or Pension Funds
Insurance companies
Corporations

Private clients
Individuals who have a lot of money (high net
worth)
Often just want to manage investments vs. grow
Difference between banks and
brokerage
Commercial Banking Retail Brokerage
Typical “bank” - go to the aka: a form of individual
bank, make a deposit asset management
Players  Invest money for
 JP Morgan Chase individuals
 Bank of America  Players
 Citi  Merrill Lynch
Make money by  Morgan Stanley
“borrowing” and lending  Goldman Sachs

 Make money on trading

commissions
 The Buy
Side
They buy securities offered by the sell-side
All over the US (buy side) vs. just in NYC (sell side)
Many firms have both buy and sell side components- the
buy side of an investment bank is the Asset Management
part
Buy Side Components Buy Side Firms
Pension funds Fidelity Investments
Mutual Funds Federated
Hedge Funds Mellon Financial
Institutional clients Vanguard
Insurance companies AIG Global
Individual clients Investment
Washington Mutual

What is Life Like?
Common Things Capital Markets
Long Hours Shorter hours (60-70)
Lots of Stress Very fast paced
High pay High pressure/stress

Investment Banking Buy Side

Really long hours (80- Short hours (40-50)
90) Slower paced
Slower paced Low stress
Lots and lots of
money
Where Do You Fit in an
I-Bank
Analyst (no MBA): 1-3 Years Out of
Analyst College
$80k-120k in salary + bonus

Associate
Associates : 4-7 Years Out or Post
MBA
$120k-300k in salary + bonus
VP
Vice President: 7 – 10 Years Out
$300k-1M in salary + bonus
MD
Managing Director: 10 + Years Out
$500k-10M in salary + bonus
The Hiring Process
Internships Full-Time positions
Freshman Seniors
Sophomores Transferring from a
Juniors different job
Graduates
The Hiring Process
Places to apply
Investment Banks
Hedge Funds
Private Equity Firms
Fortune 1000 companies (Finance department)
Local companies where you will get good
experience

Interview
First round- usually behavioral
Second round- more technical
How to Get In
Qualitative Skills
 Be intelligent/intelligent looking
 Make yourself marketable
 Know how to interview
 Good interpersonal skills
 Strong work ethic

What you should have Image is everything

 Strong quantitative competency  The way you carry yourself
 Good grades  The things you say
 Strong leadership in  The people you associate
extracurriculars with
 Appear
How to Get In
What you should do
Make yourself marketable
Know how to interview
Network, network, network
Be aggressive
Use Alumni
Use any contacts you may have
Use job search sites to locate opportunities
In the end, you don’t need a degree in finance, just an
interest
Skills/helpful tips
Learn Excel
Read the Vault guide
Investopedia.com, wikipedia.com
Read the Wall Street Journal
Ask people for help;
upperclassmen, career center,
people in the industry
Have a solid resume
Do LOTS of practice interviews
Books: Liar’s Poker, Monkey
Business
Movies: Wall Street
Future Events
Interview Training - January
 Wall Street interview are very different
 Tips on how to do well in interviews
 Show you what to do/what not to do
 We’ll go through some mock questions/short
interviews (best way to learn)

Fidelity Presentations
 Technical Analysis- Oct. 30, 4:30pm, Simon
 Investing Basics- Nov. 5, 4:30pm, Simon

Finance Jobs- Wednesday Night Insight- Nov.

7th
 In conjunction with Tepper/Career Center
 Focus on non-Wall Street finance jobs
 Words You Now Understand
Sell Side Buy Side
Investment Banking Asset Management
Commercial Banking Mutual/Hedge/Pension
Capital Markets Funds
Sales & Trading Stock Broker
Traders Equity
Analysts Debt/Fixed Income
MD (Managing Institutional
Director) Retail