Markets Careers

Investment Banks

Investment banks are behemoths of the markets, handling the vast majority of trades for all public assets.

You could describe them as the markets' middle-men, although that phrasing downplays the importance of their role: they are middle-men in the same way that supermarkets are middle-men between farmers and their customers. Much like supermarkets charge higher prices than the farmers they buy from in exchange for handling issues of distribution, advertising, pricing and managing inventory, investment banks function as a central hub for other financial institutions to buy and sell assets to/from, and in return, they pocket 'the spread'.

Investment banks also:

Provide trade ideas to their clients. This helps them build relationships, and increases the volume of trades that they handle (with each trade, they pocket the spread)
Help clients execute 'shorts', a special type of trade where a client makes money from an asset's price going down
Structure, price and sell complex financial instruments suited to their clients' needs
Manage their inventory risk by hedging
Take views on the market themselves. Investment bank traders continuously shift the prices that they offer in order to keep themselves at a certain inventory level: if the trader believes that the price of an asset will go up, then they will often hold a larger inventory of that asset, so that they can profit directly from price rises. Different investment banks have different philosophies on how much risk they are willing to take; it's usually a secondary priority to market-making.

Sales

Sales consists of the relationships that make trades happen.

What do they do?

As a salesperson, the bulk of your day is spent discussing and presenting trade ideas with your clients and colleagues (traders and other salespeople). It's a supportive role that allows the traders to focus on trading, while salespeople keep an active line of communication open with clients. The role is less intense than being on the desk but still hugely exciting and important, and can be very lucrative. You carry your relationships with you for life, so top, experienced salespeople are highly sought after. It's a great combination of a strong interpersonal foundation with the technical skill required to be able to talk markets. Swanky client dinners and drinks nights abound!

A day in the life

Salespeople arrive at the office slightly later than traders (7-8am), mainly because they don't require as much prep before the market open, but also as they may have been out with clients the night before. Market hours are spent understanding clients' plans and decisions, discussing and pitching trade ideas, and answering their clients' questions. Salespeople leave the office soon after market close, but their day doesn't end there; they often take clients out for dinner or drinks in the evening. In that sense, sales hours can extend late into the night, but, while salespeople do have to maintain some professionalism, these hours are a lot more casual and fun.

You’ll be suited for this role if

You enjoy working with people, foremost
You like the dynamism of the markets but want a role less intense than trading
You want a relationships-focused role that still has a strong technical component
You're resilient: many ideas you propose will not succeed
You want a relationships-focused role which can still be incredibly lucrative