Investment Banking (2 Viewers)

[RealiseNothing]

Absolutely. These days I get up when I feel like it, although I make an effort to go to work by a certain time. I do what I like to do at work, only look at things that interest me or I think have meaningful payoffs. Of course, I can bust my chops and increase my odds and chase every opportunity, but that's what my first 8 years were for.

Curious what your thoughts are on prop trading.

 

[Omnidragon]

What, like at home? Or are we talking about HFT, algos, or working at trading division of a bank or HF? Or you talking about family offices but that's not trading.

 

[Simorgh]

how much can investment banking earn you straight after graduation from uni? And what is the maximum you can get in a lifetime?

do investment bankers have any sort of social life, like how do their relationships go like with family, partners and friends?

 

[turntaker]

how much can investment banking earn you straight after graduation from uni? And what is the maximum you can get in a lifetime?

do investment bankers have any sort of social life, like how do their relationships go like with family, partners and friends?

20k max in a lifetime

no social life, no relationship

soz m8

 

[Simorgh]

20k max in a lifetime

no social life, no relationship

soz m8

U wouldnt know

 

[turntaker]

U wouldnt know

How u know.

 

[RealiseNothing]

What, like at home? Or are we talking about HFT, algos, or working at trading division of a bank or HF? Or you talking about family offices but that's not trading.

Pretty sure HFT/algos, think companies similar to Optiver but bigger I guess.

 

[milkytea99]

What about accounting? Is this book lying to me lol. I would like to know why do people give sooo much credit to investment banking and management consulting in comparison to accounting? I know that you can earn a lot in IB and management consulting and all the top kids do it. But is accounting as bad as it seems to be?

 

[RealiseNothing]

What about accounting? Is this book lying to me lol. I would like to know why do people give sooo much credit to investment banking and management consulting in comparison to accounting? I know that you can earn a lot in IB and management consulting and all the top kids do it. But is accounting as bad as it seems to be?

This is why I'm curious on Omni's opinion on prop shops. Because from what I've seen prop shops (talking about good ones) have much higher salaries than IB/consulting, and it's weird why everyone goes for IB over them etc. My guess is because prop shops are more selective/exclusive/harder to get into? Or is there some kind of opportunities down the track that IB people get that prop shops don't.

 

[Trebla]

This is why I'm curious on Omni's opinion on prop shops. Because from what I've seen prop shops (talking about good ones) have much higher salaries than IB/consulting, and it's weird why everyone goes for IB over them etc. My guess is because prop shops are more selective/exclusive/harder to get into? Or is there some kind of opportunities down the track that IB people get that prop shops don't.

Not sure about salary, but there aren't as many positions in prop trading space as there are in the investment banking space.

Also, whilst prop trading has fewer hours than investment banking, those hours are more pressurised with higher stakes. I have heard of some graduates not surviving their first year as a prop trader but very rarely have I heard something like that in investment banking. Maybe a stuff up is more likely to get you fired in prop trading than investment banking?

Even being a trader in general (not necessarily a prop) is more pressurised than the project-based work you get in investment banking. The culture is far more fast paced and cut-throat because millions of dollars are at stake so it is not for the faint hearted.

 

[Chronost]

What about accounting? Is this book lying to me lol. I would like to know why do people give sooo much credit to investment banking and management consulting in comparison to accounting? I know that you can earn a lot in IB and management consulting and all the top kids do it. But is accounting as bad as it seems to be?

That book is roughly correct - however that salary after 3 years would only happen for an above average performer at a Big 4 and in FS audit - but if you move after your CA to commercial, that'll be roughly what you make on average (including super), yes.

This is why I'm curious on Omni's opinion on prop shops. Because from what I've seen prop shops (talking about good ones) have much higher salaries than IB/consulting, and it's weird why everyone goes for IB over them etc. My guess is because prop shops are more selective/exclusive/harder to get into? Or is there some kind of opportunities down the track that IB people get that prop shops don't.

Trebla's pretty much right, I have friends who have friends at Optiver and he mentioned there is a significant culling after the first year (or even during the year) if your performance isn't up to par, and they do set a pretty high bar that needs money to be made. If you do make it through your definitely earning way more then any IBer will in their first few years even, and that's just the first year in Optiver (he knows someone at Optiver earning a cool 400-600k a year depending on his trades.).

IB is different in that, it's long hours but different in the sense that there's no significant pressure like there is with algo trading, it's simply the powerpoints,excel, making everything perfect that takes a significant portion of time, whilst trading is very calculated, timing,news etc..all very real-time and split decision making.

IB also does some culling after the second year, but it's definitely not as bad.

Also exit opportunities are not the same as IB - in IB you can definitely, after a few years if you want go for a more 9-6 job in finance or if you want to really move up , go to HF,PE or start-ups.

Prop Trading you can go PE or HF or other trading careers, but your skills are different to a normal office job and it's harder to make the switch sometimes.

That being said , why would you when you've probably already made millions by the time you want to settle down hahahaha. (and just trade in your own office)

Annd one more thing is that a lot of the IB-wanabes don't have the maths required for algo/HF trading, different to trading in IB where you're actually just trying to get rid of unwanted trades from high net worth clients that you just bought shares for 85% of the time, the other 15% is actual trading with the banks money (and the money given to grads has been decreasing each year, so bonus wise your definitely getting less then someone at Optiver or other algo/HF traders.)

 

[jinxyy]

a

 

[Simorgh]

how much can investment banking earn you straight after graduation from uni? And what is the maximum you can get in a lifetime?

do investment bankers have any sort of social life, like how do their relationships go like with family, partners and friends?

No one care to answer me?

 

[Chronost]

No one care to answer me?

About 105k give or take depending on the bank straight after graduation - maximum is around 5-6 million for a star MD/head of ex section - you can just read the remuneration report the US banks file in their annual report.

That's dependent on you,the bank and the team - generally you work long hours compared to a normal office job but still very much able to do something on a normal night (say after 7-9pm)

 

[RishBonjour99]

About 105k give or take depending on the bank straight after graduation - maximum is around 5-6 million for a star MD/head of ex section - you can just read the remuneration report the US banks file in their annual report.

That's dependent on you,the bank and the team - generally you work long hours compared to a normal office job but still very much able to do something on a normal night (say after 7-9pm)

5-6 million for 'star' MD sounds pretty shit when macquarie's star MIM head made 7.xx m last year, only behind the CEO working most probably materially less hours than MDs in IBD. Most people will move out of investment banks into better things if they can.

 

[obliviousninja]

5-6 mil usd?

 

[jinxyy]

a

 

[RishBonjour99]

If you really want to be rich, forget about business or law school. Take up singing lessons and become the next Justin Bieber. Dude makes about 60-80 million dollars a year compared to your pleb investment bankers or corporate lawyers.

Hell, even the 18 year olds in the aussie boy band 5 seconds of summer are making 500k a year. That's without having to go through 3-5 years of uni struggling for HDs, extra curriculars, getting a perfect resume, etc.

You're comparing the 'top tier' most money making music industry guns currently with the lowest of the finance world. Top headge fund managers are worth billions - more than Justin beiber will ever make.

 

[jinxyy]

a

 

[turntaker]

If you really want to be rich, forget about business or law school. Take up singing lessons and become the next Justin Bieber. Dude makes about 60-80 million dollars a year compared to your pleb investment bankers or corporate lawyers.

Hell, even the 18 year olds in the aussie boy band 5 seconds of summer are making 500k a year. That's without having to go through 3-5 years of uni struggling for HDs, extra curriculars, getting a perfect resume, etc.

The chances of that are a fraction above zero.

In regards to "being rich", you are not going to make big amounts working for someone. Not saying working for someone is a bad thing, but as long as you are an employee, you can't earn nearly as much as the business owner.

It is estimated that the employer will generate 4 times the amount income of your earnings. So if you salary is 100K, the business will earn 400K from your work. (Keep in mind that not all of it is profit but a lot of it will be.)

In the end, the economy is business driven and when you are an employee you are just a cog for the company you work for to generate lots of profit.