High School

Since the majority of investment banks hire analysts from top colleges and universities, it’s very important that you earn stellar grades in high school, take as many advanced placement classes as possible, participate in a lot of extracurricular activities (e.g., business clubs, sports teams, speech team, etc.) that look good on a college application, and perform well on your SAT or ACT exams. Recommended classes include business, economics, statistics, accounting, mathematics, foreign language, English, psychology, and speech. Classes that help you to develop your skill at using databases and spreadsheets and making presentations will be useful. Investment bankers need excellent analytical and critical-thinking skills, so be sure to take history, social studies, philosophy, and other classes that help you to develop these abilities.

Postsecondary Education

The typical investment banker has a graduate degree in business from an Ivy League school or other top-tier university and superior educational credentials [i.e., excellent grades (minimum 3.50 GPA), active participation in business and investment clubs, and participation in at least one internship or summer program at a top investment bank, Big Four accounting firm, alternative investment firm, or another prominent employer]. Some investment bankers have master’s degrees in finance, economics, accounting, or engineering. Others have law degrees. For their undergraduate education, aspiring investment bankers typically earn degrees in business, finance, quantitative finance, accounting, or economics from a top school. Recommended courses for those interested in investment banking include Introduction to Financial Accounting, Financial Management, Intermediate Financial Accounting, Financial Statement Analysis, Corporate Investment Decision-Making, Corporate Financing Decision-Making, Capital Markets and Investment Strategy, and Fixed Income Securities/Markets.

Yet, despite popular opinion, there is no traditional educational path for investment bankers. Some investment bankers have degrees in history, political science, or even philosophy. While investment banks typically recruit about 80 percent of their hires from Ivy League and other schools with top finance programs, they also recruit from lesser-known, but still quality, programs. The key point to remember is that if you do not attend a top school or major in finance or a related subject, your grades need to be excellent, you need to complete multiple internships at investment banks or related employers, and minor in business, finance, economics, or accounting.  

Much of an investment banker’s education takes place on the job, informally, and is acquired by creating these complex financial models, rather than through formal education. This is due partly to the fact there is so much complexity in creating financial models and the formulas used in creating these models are constantly changing. General aptitude and a knack for getting deals done is a better indicator of eventual success than an Ivy League pedigree. For this reason unconventional career paths are not all that uncommon. Wall Street firms are definitely interested in people with science backgrounds who have industry experience—and personal contacts—in a fast-growth industry like bioscience or nanotechnology.

Many banks offer formal training programs for new hires—especially those at junior investment banking levels. For example, the global investment bank Houlihan Lokey offers a three-week training program for new campus hires to get them up to speed quickly. Topics include Excel best practices, organizing and building basic spreadsheet and cash flow forecasting models, sell-side mergers and acquisitions pitching to senior bankers, and comprehensive analysis and modeling of a company in bankruptcy.

Some banks provide ongoing continuing education opportunities to employees. For example, Goldman Sachs offers Goldman Sachs University (GSU), an internal training and development resource that features more than 4,000 classes offered in classroom, webcast, and e-learning formats.

Other Education or Training

The CFA Society New York, Association for Financial Professionals, CFA Institute, Futures Industry Association, International Association for Quantitative Finance, CMT Association, and Securities Industry and Financial Markets Association provide continuing education classes, webinars, and workshops. Contact these organizations to learn more.

Certification

Colleges and universities provide certificate programs in investment banking and related areas. For example, City University of New York-Baruch College offers an Advanced Finance and Investment Principles Certificate Program. Classes include Introduction to Derivatives Markets, Debt and Fixed Income Markets, Advanced Financial Statement Analysis, Equity Markets & Portfolio Theory, Investment Banking, Entrepreneurial/Venture Finance, and Wealth Management. The University of Houston, Johns Hopkins University, and other colleges offer related programs. Contact schools in your area to learn about what types of educational opportunities are available. Additionally, Fitch Learning (which offers continuing education opportunities to individuals and corporations) offers a certificate in quantitative finance. Visit https://www.cqf.com for more information.  

Certification or Licensing

Many investment bankers hold the chartered financial analyst (CFA) certification, which is offered by the CFA Institute. Other popular credentials include the following:

• certified public accountant (American Institute of Certified Public Accountants)
• certified investment management analyst (Investments & Wealth Institute)
• chartered market technician (CMT Association)
• certified corporate financial planning and analysis professional (Association for Financial Professionals)

Many investment banks require their investment bankers to have their Series 7 (or General Securities Representative), Series 63 (Uniform Securities Agent State Law), Series 66 (Uniform Combined State Law), or Series 79 (Investment Banking Representative) credentials from the Financial Industry Regulatory Authority, the self-regulatory arm of the investment industry.

Aspiring investment bankers must have at least three years of experience as an investment banking associate, or other applicable experience (e.g., private equity, corporate development, etc.).

According to its Web site, investment banking giant Credit Suisse seeks the following qualities in its investment bankers:

• leaders who engender loyalty, assume responsibility, and mobilize others
• critical thinkers with excellent problem-solving skills
• self-starters who achieve significant results
• adaptable team members who can build and support strong relationships
• communicators who are skilled in articulating and listening
• principled contributors who are committed to the highest standards of ethical behavior

Other important traits include curiosity, ambition, adaptability, the capacity to work long hours, patience, a positive and encouraging attitude, attentiveness to detail, skill in the use of Microsoft Excel and PowerPoint, and a deep understanding of financial accounting valuation methodologies.