Last updated on April 5th, 2024 at 10:49 am
Investment banking is a highly sought-after area in the money market. The current investment banking industry is valued at 80.54 trillion USD.
Wondering how an investment banking course can help learners? It gives them cutting-edge competition and ensures that they are equipped with both traditional and modern solutions along with solution-based technologies.
To crack an investment banking hiring process, a candidate needs to access efficient ways in which they can handle the company’s investments.
With Imarticus’s investment banking essentials, one can tread the paths just as smoothly and achieve their goals.
In this article, we will find out about the investment banking market while looking at some real-life examples surrounding case studies in various areas.
Reasons for case studies
One of the top reasons why investment banking studies can benefit learners is in terms of making well-thought decisions on investments. Apart from this, here are some more reasons why one should learn from investment banking case studies.
- Experience: Since investment banking isn’t fairly new and has been in the business since the 19th century, it is a well-explored branch.
Due to this, enthusiasts can learn from prior cases and gain experience with time. This includes gaining experience and skill sets in all the primary aspects including banking, interpersonal, and analytical skills.
- Skills: When it comes to skills that an investment banker is supposed to have, IB skills often differ from that of a general banker. These include being able to analyse frequently and carrying on with an analytical mindset throughout their job.
This also involves being able to work in a team as this job requires a certain level of interpersonal communication and team morale.
- Financial complexity: To be able to make good financial decisions in seconds is a good part of the job for an investment banker. As an IB, the primary task is providing a financial outlook into complex financial transactions.
An investment banker can offer insight into the risks associated with such high-valued investments. Simultaneously, one can devise expert solutions for growing financial challenges in the money market.
Real-life examples
Before venturing into the case studies, it is important to note that there are two types of investment banking studies taking centre stage.
These are primarily modelling and decision-making studies. Let’s look at how both are distinct and can be utilised for the best solutions.
Case study - Modeling
Background
A prominent investment bank is looking to efficiently price financial derivatives using improved models. Currently, the bank is utilising the Black-Scholes model for pricing their investments. On the other hand, it isn't quite successful in measuring the losses made in the bank’s derivatives market trading book.
Challenges presented
The bank needs to come up with more efficient models for handling their accounts. This includes being able to better their money market dynamics.
Solutions implemented
The bank can utilise more sophisticated models in work such as Monte Carlo, Stochastic Search, and even Regressive models. These models can present the bank with a more refined way of handling their finances as well as ensuring accuracy with the highest quality.
Atop the investment models already at work, they would have to come up with a risk management system with the expertise of an investment banker.
Case Study 2 - Decision making
Background
An investment banking firm is currently consulting a client seeking a new investment option. At the same time, the nature of investment is high-risk and high-return making it a viable option for investment banking consultancies.
Challenges presented
Since the firm is seeking a solution for a high-return investment, it is due to include several risks. These include increased volatility, a chance of blind gambling, and other risks such as systemic, regulatory, and counterparty risks.
Solutions implemented
The first and foremost thing that investment bankers can focus on is the assessment of desired outcomes. One can do so by conducting an independent check and comparing the risks and benefits associated with the proposed venture.
Simultaneously, they can focus on ongoing market trends and mark the potential implications that come with the new venture.
Additionally, the firm can utilise potential strategies that are highly effective and maximise their returns on the new investment. These involve working with a comprehensive model including predictive models, and researching alternatives for yielding the best outcomes.
Lessons learned
While we have already discussed the case studies before this, it is essential to note that investment banking studies can only serve as examples. However, the lessons learned over here are vital to the future of identifying trends and making careful decisions. Here are some of the pointers for following the correct route for investment banking.
- Emphasise coming up with strategic instead of traditional solutions.
- Focus on structured solutions along with the strategic counterpart. This helps in devising a potential solution before making an educated guess.
- Equip oneself with Excel and PowerPoint for better accessibility to the figures and potential outcomes.
- Do a thorough assessment of all available figures before presenting them to a team.
- Although it is completely acceptable to present previous figures and the solutions associated with them, it is advisable to look for future implications regarding a particular solution.
- As most cases can be critical to the outcome, it is best to find a strong logical understanding of the same to predict favourable outcomes.
- Enrich the project with all relevant news and practices for the best outcome.
- Go over a question twice before interpreting them and presenting a solution.
- Lastly, apply professional logic to the problem before moving forward with the solution/s.
Conclusion
Investment banking studies and their case examples provide valuable insight into the market and the trends that are currently ongoing. At the same time, they also offer a clear cognizance of the future, thereby marking a trend into the future of the investments currently in question.
Furthermore, they allow students and practitioners to come up with more effective solutions to complex banking problems, which makes it all the more essential. Imarticus Learning’s 150-hour investment banking certification enables learners to opt for a clear-cut course and venture into the world of investment banking in no time.
As it is a highly rewarding field with salaries ranging anywhere between 125,000 to 10 million USD, the investment banking career is a lucrative option.
Sign up for the programme today! A Certified Investment Banking Operations Professional course can bestow individuals with the required skill set and experience for cracking the investment banking position.
Besides being one of the top courses catering to investment banking enthusiasts, it is also a flexible option for online learners.
