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Financial Modeling Training in 2022: How to get started without experience?

Posted on by Imarticus Learning

Financial Modeling Training in 2022: How to get started without experience?

Financial modelling is a skill that helps a retail organization decide how and where to open its store. It is a key skill that is mandatory if you are looking for a career in finance. It is also helpful for entrepreneurs planning to start their own gig, and can even prove to be handy for marketing and sales professionals.

Financial modelling also includes looking at projections, evaluating the practicality of the decision, and analyzing the stock market in terms of cost, revenue, and profit.

If you do not have work experience, do not be afraid, you can still have your own business or make a career in finance by enrolling yourself in a financial modelling course.

 What are the Various Application Areas?

  • Corporate Finance

This model is used by various companies to evaluate their finances and projects and help create plans for funding projects.

  • Investment Banking

Financial modelling is the fundamental tool for valuation and analysis. An investment banker uses this model to come to a valuation in fundraising transactions. An equity analyst will use this model to come up with buy/sell or hold recommendations by applying them to value stocks.

  • Entrepreneurs

 

Entrepreneurs use the financial model to pitch their plans to prospective investors and to strategize their future plans. Carrying out various experiments can be beneficial to avoid any risks and financial loss in upcoming businesses.

Types of Models

When you enrol in a financial analyst course you will be taught about the following financial models:

  • Leveraged Buyout Model (LBO)

In this kind of layout, the firm will finance its acquisition via a considerable amount of debt. The LBO model is used so this model helps to critically analyze whether the business can manage the debtor if a certain degree of performance is needed to make sales and eventually pay off the debt.

  • Credit Rating Model

This model is employed by credit analysts to figure out the creditworthiness of a firm. The model makes assumptions with respect to future earnings and if the company can pay the interest and principle.

  •  Comparable Company Analyst

Under this model, the financial metrics of a company are compared with similar organizations in the industry.

  • M&A Model

The whole purpose behind the merger model is to decode the effect of the acquisition on the acquirer and whether the new EPS is comparable with the existing one. If the new EPS is higher, the transaction is referred to as ‘accretive’, and vice versa is referred to as ‘dilutive’.

 Skills You Need to Have

Although you can learn the tricks of the trade in this discipline by enrolling yourself in a financial modelling course, some skills that whether inherent or learned are essential to making this career work are:

  •         Prerequisite

Financial management and ratio analysis, financial statement, valuation methods, written communication, and analytical ability.

  •         Core Skills

Drawing up financial statements in excel, analyzing financial statements, and being able to build from scratch fresh financial models with high potential for success.

  •         Related Skills

Knowledge of mutual funds, debt markets, credit appraisal, and understanding of various financial market tools can help to build your business in finance, banking, and investment.

Conclusion

A financial modelling course is an in-demand qualification for many lucrative opportunities in the market such as equity researcher, portfolio manager, and credit researcher. If you do not have a background in this field professionally, you can easily join a course as a fresh graduate, post-graduate, or MBA student, and learn what it takes to be successful on this path.

7 reasons why financial modelling skills are indispensable to investment banking professionals

Posted on by Imarticus Learning

7 reasons why financial modelling skills are indispensable to investment banking professionals

To work in investment banking, you need to demonstrate that you have a range of skills and knowledge that are differentiated or in demanding careers, such as financial modelling skills. Moreover, the investment banking sector deals with the financing of companies through equity or debt. This includes work such as buying and selling companies in whole or in part, IPOs, joint ventures, or risk hedging.

To achieve this, investment banks must work directly with the management of the companies involved, as well as with investment funds or public financing facilities. 

This requires people who want to work in investment banking to have a multidisciplinary profile with extensive financial knowledge, agility in financial modeling, and good interpersonal and communication skills. Here we tell you 7 reasons why financial modeling skills are indispensable to have investment banking skills.

What is financial modeling? 

The term financial model refers to an abstract-mathematical version of a company’s financial reality in a set of spreadsheets.

best financial analyst courseA model is thus a mathematical, simplified, and idealized version of the reality of a company. The model works out simple versions of real factors and translates them into spreadsheets that facilitate the execution of mathematical calculations on the data.

The purpose of a financial model is to represent reality as simply as possible while still being a realistic reflection of the company’s situation, and thus to enable the company’s financial statements to be projected on the basis of current and historical data.

Here are the 7 main reasons why financial modeling skills are indispensable to having investment banking professional skills:

  1. It allows you to give a transparent picture of the overall situation of a company.
  2. It helps to project the impact of any changes in the company’s structure or business.
  3. Since financial models are designed taking into account historical data in addition to the structural situation, the model allows for the definition of scenarios with variables that reflect changes in the entire structure depending on their value.
  4. It is an integrated planning system that contains the profit and loss accounts, the balance sheet, and the calculation of capital flows with their respective dependencies. In this way, the model makes it possible to project the development and consequences of a change scenario for any given decision. This is an indispensable tool when making decisions affecting the structure of a company, as it makes the impact of any decision transparent.
  5. All companies need a business plan to organize themselves, but from the moment external financing comes in, whether, through credit or investment, the financial model becomes an essential planning tool.
  6. Investors only invest their money if they are convinced that the company will be able to repay loans and interest in the future, thus providing a return on their investment, which is why a transparent, complete, and correct presentation of the financial situation, especially the projected income, capital, and liquidity situation, is indispensable.
  7. Apart from their use in all matters relating to financing, financial models are also used for business management.

Why Imarticus for a CIBOP online course?

Financial modeling, i.e. the design and planning of a financial model, is mainly used in the preparation of a business plan or in the representation of a company’s financial structure. The aim is to translate the reality of the company into an abstract model that provides a transparent picture of the overall situation of a company. 

In Imarticus we offer CIBOP Certified Investment Banking Operations Professional courses for those who need to start from scratch. If you have any questions, please do not hesitate to contact us to have more information on investment banking courses.

Top 7 core competencies an executive program in investment management provides

Posted on by Imarticus Learning

Financial management is a very sensitive sector. Employers and their valued clients are quite selective about the skills they wish to recruit inside their financial processes. Investment banking and various other services related to investment management such as capital services offer extremely lucrative career prospects and salaries.

However, in order to join this sector, professionals must be competent in 7 main areas. Falling under financial management, investment management is one of the most premium sectors in the finance industry, and thus, firms have high expectations when looking for candidates. 

There is no need to worry as there are executive programmes such as IIM Calcutta’s Investment Banking and Capital Markets programme that can help working professionals learn all the essential skills, tools, and concepts needed to join this sector. Let us learn more about the 7 core competencies that solid Investment Management certifications are sure to teach.

Top 7 Core Competencies

Due to the nature of the sector, understanding the basics of finance is compulsory. An executive programme in Investment and Financial Management such as one offered by the Indian Institute of Management Calcutta teaches you foundations of finance as well as financial accounting and financial economics. However, these are not core competencies and are just simply foundation modules. 

Now, let us learn more about the core competencies that are crucial for roles such as investment banker or capital markets specialist.

Debt Capital Markets: Investment management professionals are expected to be masters of various aspects of debt such as debt structuring, debt valuation, and debt financing. Debt capital markets also teach you loan portfolio management, credit appraisal, and debt origination.

 

  • Equity Capital Markets: Investment banks and firms deal with equity valuation, equity origination, and equity financing. Thus, these organizations also expect their investment bankers and managers to know about issuance mechanisms and underwriting.

 

  • Mergers, Acquisitions, and Restructurings: In investment management, one must also study corporate deals, takeovers, corporate restructuring, mergers, acquisitions, asset valuation, and leveraging. There are various modules taught in investment management programmes such as business advisory or leverage financing that will allow you to help companies make these deals and transactions.
  • Portfolio Fund Management: These programmes teach portfolio management concepts such as asset pricing models and factor investing. Handling the portfolios of valuable clients is essential and banks or firms demand their personnel to be experts in portfolio management. Learning portfolio investment strategies, portfolio theory, alternate investments, and private equity is essential. 
  • Securities Market Research and Valuation: For security market research and valuation, investment management programmes teach corporate valuation, industry analysis, and cash flow estimation. You also learn report evaluation and how to carry out industry analyst research.
  • Securities Market Sales and Trading: For security market sales and trading, these executive programmes offer training in high-frequency finance and derivatives trading. You also get a good understanding of securities market trading strategies and market microstructure.
  • Securities Market Regulations: Investment management deals with security market regulations that pertain to security issuers and security market issuances. Relevant programmes teach you about capital market regulators, capital market investors, corporate governance mechanisms, and market infrastructure institutions.

 

 

Other than the 7 core competencies, there are also some necessary technical skills, leadership skills, and soft skills that are required. These skills are also covered by executive programmes.

Conclusion

The Executive Programme in Investment Banking and Capital Markets by IIM Calcutta and Imarticus Learning is your key to a successful future in these lucrative sub-domains of finance. Finishing the programme successfully also fetches you a certification from IIM Calcutta and you are able to join IIM Calcutta’s Executive Alumni status where you can engage in peer-to-peer networking. 

Uncover what’s next for the Investment Banking online courses

Posted on by Imarticus Learning

Investment banking is one of the most sought-after disciplines among youths due to its enriching career opportunities. However, it is no secret that the COVID-19 pandemic has disrupted the investment banking sector heavily with time. This sector has promised a healthy comeback. Hence, this might be an excellent opportunity for individuals to enter the market with a proper investment banking certification that will allow them to prove their interest and credibility in the field. 

Experts believe that investment banking is in much better condition presently, as there are substantial reasons for it. A few of these reasons are: 

  • Emphasis on captive revenue streams 
  • Change to a sustainable and lower capital intensive execution business
  • A surge in the share of ‘captive’ business and others 

Banking Course Modules 

Keeping the trends in the market, investment banking courses online have aligned their curriculum with current market needs and included some of the key pointers, such as: 

  • Working capital
  • Income statements
  • Equity method investments
  • Cash flow statements
  • Accounting ratio
  • Capital structure 
  • Non-current assets 

However, individuals must remember that these modules might differ a bit from the actual coursework and they must check the curriculum properly before going for an investment banking course. In a broader way, these certifications might cover valuation, financial modeling, accounting, M & A, and LBO analysis. 

So, individuals can learn investment banking online, but before that, they must know a few details about this sector. As mentioned above, the investment banking sector has changed after the pandemic and there are a few trends that are shaping the concerned industry.  

3 Factors Shaping The Investment Banking Sector

The top trends that are shaping the investment banking sector are: 

 

  • Big data

 

The massive digital transformation has reshaped the architecture of investment banking. The data collected is a rich source to strategize for expanding new products, establishing new market strategies, and uncovering client interests.

Furthermore, with the help of data from the first and second parties, companies save an enormous amount of time wasted for data entry to keep the information updated. So, individuals intending to learn investment banking must also know about big data and its application. 

 

  •  Using the first-party data

 

Most relationship managers in investment banks have a pile of data to analyze to look at deals. For these, using first-party data is the primary resource and most investment banks started using this early.

However, keeping track of relationships and companies with the pile of data might be difficult. So, analyzing the first-party data can solve a bigger goal without much concern. Hence, using it correctly for analyzing calendars, social media relations and e-mail traffic can considerably enhance traffic. 

 

  • Using predictive analytics and AI 

 

Evaluating a pile of data manually can be challenging to execute for analysis. So, the advent of predictive analysis and AI has eased the understanding of information for faster and more accurate results. However, most leading investment banking courses online provide factual information and knowledge to succeed in this field. 

So, it is essential to understand that apart from the basic concepts through an investment banking certification course, it is also important to understand the modern approaches of this field. This will give an edge to a candidate to ace and master the field of investment banking.