So You Want a Career in Investment Banking, Corporate Finance or Trading?

Keynes
Friday 27 March 2009 17:56 GMT

Well let's see. For the first time in 7 years the U.K. couldn't find enough buyers for its Gilt auction so it failed. In the USA, treasury bills are trading at NEGATIVE rates today which means investors are so afraid of losing their principal that they are willing to PAY the gov't to hold on to their money. Ummm ... yes ... it should work the other way around; usually when you lend someone money they pay you. I have traded though the stock market crash of 1987, the Russian crisis, 9/11, and the Long - Term Capital debacle and can never remember the credit markets in such disarray as they are in right now.

Is this the kind of markets and global financial system you want to try and start a career in!?

The answer is absolutely because intelligent and cool-headed decisions made during utter chaos can often reap huge rewards. The companies that survive this crisis will be left in a much stronger position to profit and thrive (... cough ... JPMorgan ... cough ... Goldman Sachs) as their competitors go bankrupt or merge (Lehman, Bear Stearns, Merrill Lynch). Larger product profit margins will exist for dealers of securities. Clients will demand better and more specific financial advice which they will pay for. Wider credit spreads will create more arbitrage and pure carry plays. Consequently, major opportunites will open up for graduates who understand what has happened and how you can capitalize on it.

Comments

James, London
28 Mar 09, 10:33am

Imperfect markets creating more opportunities to make large margins may count as a draw to trading roles, but the same can hardly be said of corporate finance / M&A where bankers are paid a fixed service fee. Having said that, while finance remains an unfashionable industry it may be a good time to get in and advance up the ladder. That way you will be sitting pretty when hiring increases again and you are the most senior part of a broadening employee pyramid ...

Dave
30 Mar 09, 04:42pm

Keynes, you have a great point. After the massive Wall Street layout the industry survivals will soon need new and better human capital to reinforce their lines. So, maybe this isn't yet the perfect time to get in, but if the financial markets is what you like, keep them under control, work hard and be prepared because they will come back eager of new talents!

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