How To Answer Investment Banking Fit Interview Questions
If you've managed to land investment banking interviews, you need to keep in mind 3 big themes as you go through interviews and try to get a job:
-You can "burn the midnight oil" - you work hard, consistently.
-You "don't shake the Jello" - you do not make mistakes.
-You "want to be Gordon Gekko" - you love business and finance.
Burn The Midnight Oil
More than just claiming you "work really hard" you need very specific stories here. When I was interviewing for these jobs in my senior year of college I discussed my experience working at a big company and how I regularly put in 100 hours a week and lived at the office toward the end of my internship there.
How can you show just how hard you work?
-Starting your own company: Not even banking is this much work.
-Taking leadership of a large project that takes several months to complete.
-Working 2-3 jobs at once and multi-tasking all the time.
-Running a political campaign over many months.
Don't talk about Finals Week or how you worked hard for 1-2 weeks with something.In banking you'll often be exhausted for months at a time, so come up with something at least this long in duration.
Don't Shake The Jello
As a junior investment banker, your most important duty will be checking numbers and not making mistakes. As with showing your interviewers that you can burn the midnight oil, you need specific stories here to stand out.
The way to show your attention to detail is by emphasizing that whatever you did was used by real, paying customers or read/viewed by a lot of people. Having wide exposure implies that you had to get your work right.
Perfect example of this kind of experience is, Web publishers that are run every day and thousands of readers of the site. If you are someone who was the editor of this publication, published something before mistakes and errors, you must spend time checking. By relaying such a story, you can get your leadership skills as a whole.
If nothing like this, you are all the past 3-4 years has been working on one project and all one has to create a list of one organization. One, please talk to them and most of the attention to detail.
Want To Be Gordon Gekko
Even if you're not quite Mr. Gekko himself, you have to convince me that you're actually interested in finance.
This sounds elementary but you might be surprised how many people do not do that. Why apply for this job if you are interested in this? Yes, it pays a lot of money, but will never be able to stick with if you're not really interested in the industry.
Here's an example dialog showing how to convey your interest in an industry:
Interviewer: "Tell me about a market you're interested in."
You: "I really enjoy following the alternative energy industry because it's so new. There has been a lot of activity lately in the solar cell manufacturer sector, driven by technological breakthroughs and favorable government subsidies worldwide."
Interviewer: "Did you invest in any companies?It seems like there's a lot of hype surrounding everything solar."
You: "I agree that most solar companies are overvalued. After the study of large companies, I invested in solar X's a year ago. Their transactions on their rivals with 10% discount while 50% profit margin rate of growth. while their price-earnings ratio is only 30 or so, rather than 40 to 50 other companies. "
Interviewer: "Sounds good, but why were they valued so much lower than the competition?"
You: "They came in below earnings expectations just before I invested, and announced expansion plans and new capital expenditures at the same time. Investors questioned why they were spending more and more on product development when they were getting less profitable."
Interviewer: "So why did you invest anyway?"
You: "I found a much stronger correlation between annual stock returns and growth compared to profitability. Investors were focusing on short-term results instead of thinking long-term and looking at other companies in the industry. It is a nascent, high-growth industry so growth matters more than short-term profits."
This response shows you've put some thought into this stock pick and can explain in simple terms the qualitative and quantitative reasons for investing.
It's important to do both because candidates often focus on one or the other without considering the whole picture.
15 Most Common Investment Banking & Finance Interview Questions
15 Most Common Investment Banking & Finance Interview Questions
The most common of the bank's investment banking interview interview questions, including (in some places in the tough side, but they come up very often, as a weight loss of the graduate employment market, the financial means to be more severe an increasing number of candidates list):
- How many degrees (if any) are there in the angle between the hour and the minute hands of a clock when the time is a quarter past three?
[Typically, questions asked during the interview for a job in investment banking from investment banking, entry-level]
- Find the smallest positive integer that leaves a remainder of 1 when divided by 2, a remainder of 2 when divided by 3, a remainder of 3 when divided by 4, … and a remainder of 9 when divided by 10
[Typically asked during investment banking interviews for quantitative investment banking finance jobs]
- Two standard options have exactly the same features, expect that one has long maturity, and the other has short maturity. Which one has the higher gamma?
[Typically asked during investment banking interviews for bank derivatives trading jobs]
- How do you calculate an option’s delta?
[Typically asked during investment banking interviews for derivatives trading jobs]
- When can hedging an options position make you take on more risk?
[Typically asked during investment banking interviews for trading jobs]
- Are you better off using implied standard deviation or historical standard deviation to forecast volatility? Why?
[Typically asked during investment banking interviews for quantitative finance jobs]
- Describe “duration” and “convexity”. Describe their properties and uses
[Typically asked during investment banking interviews for graduate investment banking jobs]
- Two players A and B play a marble game. Each player has both a red and a blue marble. They present one marble to each other. If both present red, A wins $3. If both present blue, A wins $1. If the colours do not match, B wins $2.
Than that of A or B or do I become a problem?
[Typically asked during investment banking interviews for quantitative finance or derivatives jobs]
- How do you “value” yourself? Here “value” means in financial terms
[Typically asked during investment banking interviews for MBA finance jobs or experienced banking hires]
- What distinguishes you from other candidates we might hire?
[Typically asked during investment banking interviews for graduate investment banking vacancies]
- If you could go on a cross-country car trip with any three people, who would you choose? Why?
[Typically asked during investment banking interviews for corporate finance / mergers & acquisitions banking jobs]
- Tell be about a stock you like or hate and why
[Accounting for any investment banking job interview questions for finance and investment banking job! ]
- What is the difference between default and prepayment risk?
[Typically asked during investment banking interviews for credit jobs / risk management jobs]
- How would you move mount Fuji?
[Typically asked during investment banking interviews for consulting jobs or graduate accounting jobs]
- Estimate the annual car demand for car batteries
[Typically asked during investment banking interviews for corporate finance jobs, mergers & acquisition banking jobs or consulting jobs]
Challenges To Core Banking Solutions Implementation Projects - Part 1
Imran Adeel Haider
Pakistan has seen a lot of banks going for new core banking solutions in the recent past. The top scoring companies here are:
1. Temenos T24 (Seven banks)
2. Sungard SYMBOLS (Three banks)
3. Misys (Two banks)
And Pakistan is not the only country in the world goes to such solutions. Obtained Banks in the Mid-East also have the same core banking solutions for a wide range of services offered to their customers, integrated with the new information systems. With the legacy systems, this was only a distant dream. Consumer Finance, based on the rapid increase in the number of wealthy and middle class, forced banks to opt for a better system and not on their current legacy applications can rely - but an archipelago of applications.
Access to these new applications - or their new versions, and business-loving people who have these applications from the word go. There are not many manufacturers, the implementation of this solution, so we can be sure that they will deliver very, very nervous. There are some basic shrink packaging needs CD / DVD to change the things tons. For an Islamic country, such as deducting Zakat (2.5% of the compulsory charity) what is not available, and the system needs to be modified. Do this kind of change is usually a number of local suppliers, who are in the bank to implement solutions.
And then you start seeing the problems.
Lack of Knowledge about the Proprietary Technology
Implementing people are not aware of the application and its underlying technology; they try to execute things based on what they learnt in college, using C# or Java. Most of the core banking solutions don't use any of these tools and platforms.
Lack of Knowledge about the Proprietary System
Players were not there when building the application developed /. They have therefore not the idea of things under the hood. This lack of knowledge poses a serious danger. Although the manufacturer of the application of implementation partners that includes trains, it is obvious that they can not train a large number of engineers of the company to implement. Also, the application vendors stretched for the supply and may not have much time away from implementation and the development of future versions / updates / patches of the applications.
No QA Process
Due to stringent timelines and over-stretched resources, the implementers do not find it worth the while to have a QA process to ensure delivery as per the set standard; supposing that there were any defined standards at all.
Scope Creep
As the Sukopukuripu banks do not have many ideas for new applications, business users, it raises will be used to their old applications. At times, things are running when they happened, please realize that you do not want that. This brings us to the next point.
Customizing towards the Previous System
Business users, in fact, to look and feel that the new system behave like the old system. To make matters worse, they may not fully conscious. Therefore, this issue time and again to them, before double-checking everything, they must seek it raised.
Unrealistic Timelines by Banks
Banks can be impractical for the completion of the project an ambitious timetable. As we can see that projects into the reasons for the delay, we are discussing in any multi-year run. Somehow, each bank that it has assessed the power of the timetable and be able to handle things better. But we know that in the IT world, this is not too late, or it does not play a role.
Unrealistic Timelines by Implementers
To beat the competition and win the order, the suppliers of banking solutions also agree with the aggressive and unrealistic timelines - timelines that even they know cannot meet.
Lack of Implementation Resources (Functional and Technical)
Lack of resources hits the suppliers/implementers very hard. There are a lot of banks going for such solutions; locally as well as internationally. This brings the workforce exposed to offers from around the world. In the case of T24, we have seen offers being extended to people who even mention the word T24 in their LinkedIn profiles. And since the banks in Singapore, Hong Kong and the Mideast pay in USD or AED, people from Pakistan and India find it very attractive to opt for such assignments. The local employers try to mitigate this risk by forcing the employees to sign three-years bonds with their staff before training them, but this doesn't help much, as the new employers are happily willing to pay their remaining period's salary to their current employer; afterall, they have to save their face in front of their client bank(s) who would be paying much higher than a bank in Pakistan would to a local implementer.
Subjugating Conditions on Consultants/Engineers
Consequently, the implementer imposes such restrictive conditions on its people that many feel disgruntled and mistrusted. They look out for a chance to get out of there, and they usually take that too.
Cash Burnout Due to High Salaries
To counter the brain drain, the implementer will keep offering high salaries to people on board. This salary is close to or equal to what would an employer offer to the Middle East and Far East markets. These strains apparently the profitability and cash flows of the company for the implementation and management loses interest in the project. This pushes the downward spiral of the implementation project.
To be concluded...
This blog is also available at http://www.sapphireconsultingservices.com/scsblog/blogs and http://imranadeel.wordpress.com