Investment Banking question? Anybody out their a ibanker, or broker?
I am currently a student at the University of Wisconsin-Madison where I'm pursuing BA in Economics and taking some finance courses. My career goal is to become an investment banker, or broker. After college I want to pursue a career more in Finance and Banking. But recently I have been considering transferring to the University of Central Florida where I would pursue a BBA in Finance. Right now I am only looking at getting a bachelors degree and not pursue a MBA or any advanced degree afterwards.
So my question is
1) will pursuing a degree in Economics at Madison prevent me from entering the finance and banking industry after college?
2) Would it be better to stay and graduate from a more well know school like University of Wisconsin-Madison as opposed to going to University of Central Florida.
3) Or would it be better to go to the University of Central Florida and Major in Finance.
Any thought are much appreciated. Thank You
- MLv 69 years agoFavorite Answer
I will answer your questions at the end:
Becoming a stock broker is very easy to do. A college education is not required. All you need to do is pass the standardized licensing exam (series 7) and you are good to go!
In order to be able to take the series 7 however, you must have a firm that will sponsor you (a firm that plans to hire you). You can start your own firm and sponsor yourself, but this is expensive and difficult to do. Go to local career fairs, visit different financial services firms in your area, and get to know what is out there. Most firms are more than happy to sponsor a new broker who can help generate revenues for the firm. Bear in mind that while you have unlimited income potential, stock brokers are paid commissions and are rarely given a base salary.
Investment banks look for a variety of different types of employees. An MBA from a high quality institution is generally preferred as well as good grades. However real-world experience as a stock broker and a good performance track record can also get you in the door. Investment bankers work with companies who need to raise stocks or bonds and will underwrite securities. Investment banking requires a lot of money, so most people work for firms. Salaries can be extremely high, but the field is highly competitive and it is difficult to land a job without an ivy league MBA or really good work experience.
The investment industry is divided between sell side firms and buy-side firms.
Investment bankers and brokers are "sell-side". The way it works is an investment bank raises money for a corporation by underwriting (buying) stocks and bonds and then hard selling them to mutual funds, insurance companies, and individual investors for a profit. Profits can be huge. Brokers are the salespeople who push the stocks and bonds on mutual funds, insurance companies, and the general public for commissions. This requires a Series 7 license. These brokers can become extremely rich as well.
On the other hand there are also buy-side advisors. Investment advisors work for mutual funds, insurance companies, or represent the general public to help these people make good decisions about their investments. Investment advisors are not paid commissions, but are instead paid ongoing advisory fees (flat fees or a percentage of assets under management) to manage the money. Money managers include investment advisors (general public), mutual fund managers, hedge fund managers, etc. Buy-side advisors and securities analysts can make huge amounts of money as well. John Paulson recently netted over $3 billion in one year by having his clients bet against mortgages before the recent mortgage meltdown. As CEO of Berkshire Hathaway insurance company (formerly a hedge fund), Warren Buffett is also a money manager.
Buy side advisors require a series 65 license and there are no pre-requisites or firm sponsorships required to take the exam.
I would highly recommend a bachelor's degree. Start studying for the series 7 or series 65 ASAP. Work extra hard to understand how to invest money effectively. Practice your sales skills, management skills, and public speaking skills. Learn as much as you can about accounting and interpreting financial statements. Become familiar with the financial markets and how each industry operates. Become familiar with as many stocks as you can.
A CPA or CFA certification will also help you land a job if you are looking for a salaried position.
1 - A degree in economics will help you enter the investment industry. A bachelors in Economics, Finance, Accounting, or Business Administration from an accredited college is preferred for most jobs. MBA from an ivy league university makes you a shoe-in.
2 - Most companies don't care where you go to school as long as it is legitimate and accredited. However obviously ivy league schools help. Avoid online tech colleges.
3 - I would go to the University that is most convenient for you. Work hard and enjoy your time there. Get involved in any financial management clubs, investment clubs, or other business related student organizations.
- Anonymous4 years ago
He is a salesman. That doesn't mean he's a crook. Just because he might be honest doesn't mean he knows what he's doing. You need to do some reading until you know enough to figure out some of the basics yourself.