Finance Club Investment Banking_ Sales _ Trading_ Corporate by Levone


									                     Finance Club
Investment Banking, Sales & Trading, Corporate Finance, Research and
                           Private Wealth

            September 7th Finance Club Meeting Agenda
   September 7th
       Club Overview
       Introduction of Officers
       Key topics by function – questions to be thinking about
        –   roles and responsibilities
        –   nature of work
        –   career paths
        –   Skills required and life style
        –   Day in the Life of a Summer Intern
       Developing your story and resume; forming study groups
       Do’s and Don’ts throughout the recruiting process
       Outline of Available Resources
       Upcoming Events
   Website
      –   From eCampusGroups, click the website link to register
      –   Newly-Registered Members will be added on Tuesday and Saturday of each
      –   Presentations will be uploaded within 24 hours
Investment Banking

                                                            The Investment Bank

                                          IB Product Gp

                                                                                 Institutional & Individual Clients
                                                                Sales &
                                          Capital Markets
Corporate Client

                          Banking          IB Product Gp
                         Coverage               M&A

                                          IB Product Gp
                                          Capital Markets    Private Wealth

                   Material, Non-Public Information         Public Information
                            “Private Side”                    “Public Side”
                                           Investment Banking Overview
                                          Corporate Clients

                                    Investment Banking Division

               Advisory                                             Capital Raising

   Buy-side advisory                                        Debt Issuance
      Purchase of assets, division or entire                   Investment grade bonds
         firms                                                  High yield instruments
   Sell-side advisory                                          Bank loans
      Sale of assets, divisions or the entire                  Mezzanine debt
         firm                                                Equity Issuance
      Managing planned sale of the firm                        Common stock
      Hostile take-over defense (anti-raid)                    Preferred stock
   Strategic alternatives                                      Equity-linked (convertibles)
      Acquire, sell, re-capitalize, go public,                 Hybrid instruments
         go private, etc.
                                                             Other Financing Transactions
   Joint venture creation
                                                                Hedging interest rate risk
   Restructuring
                                                                Hedging foreign exchange risk
   Other
                                                                Hedging commodity risk
      3rd party fairness opinions
      Miscellaneous valuation work
                               The Investment Banking Deal Team
      Managing Directors, 10-20 years experience
      Vice Presidents, 5+ years experience
      **Associates**, the central force of the deal team
      Analysts

Role of the Associate                             Coverage Officer
 Draft pitch books                                 (VP or MD)
                                  External Deal
 Draft internal bank                                                   External
    documents                                                         Deal Attorneys
 Draft marketing documents
 Financial valuation and
    analysis                                       Associate
                                                   Central Force
 Manage client interactions                      or “Quarterback”
    (CEO, CFO and Board)
 Maintain standard industry
    comparables (ie trading         Capital
                                                                     Bank Compliance
    and transaction comps)          Markets
 Track capital markets
 Perform company due
 Perform industry research
 Mentor analysts
                       Skills & Traits for Investment Banking

 Skills & Abilities                           Personal Traits
     Knowledge of financial services              High degree of motivation and
     Strong quantitative and analytical            energy
      skills, especially financial analysis        Keen attention to detail
     Advanced oral and written                    Composure and confidence
      communication skills                         Assertive and entrepreneurial
     Solid sales and marketing skills             Ability to learn, think and act
     Ability to work independently                 quickly
     Team player                                  Strong inter-personal skills
                                                   Strong interest and academic
                                                    excellence in accounting, finance
                                                    and corporate strategy
                            Investment Banking Recruiting Time-Line

September                    October             November               December                 January
Understand the Process
Develop Focus

 Build your Resume and Story

          Networking & Company Presentations

               Corp. Fin.
                                 Wall St.

                                               Individual Networking & Informationals

                                                      Chicago, London &
                                                      Asia Forums

                                                                    Mock Interviews
                                                                       Fit and Technical

                                                                                    Cover Letters and Final

                Recruiting takes a lot of work, energy and time. Plan for it.
Corporate Finance

                                           What Is Corporate Finance?
Corporate Finance = Big Picture View (General Management)…
Definition: Any financial or monetary activity that deals with a company and its money.

               Treasury                                  Strategy
- Financing
                                          - Strategic Planning
- Hedging                                 - Special Projects
- Capital Structure Analysis              - New Product Development
- Capital Markets Products

                                Chief Financial
                                Officer (CFO)

         Financial Analysis                     Corporate Development
- Planning/Forecasting                    - Business Development
- Budgeting                               - M&A
- Variance Analysis
- Cost Analysis
- Product/Service Analysis
                       Corporate Finance Career Opportunities

Financial Services                High Tech       Healthcare                  Others
• Citigroup (FMA)        • Amazon             • Eli Lilly & Company   • American Airlines
• JPMorgan Chase         • Dell               • Johnson & Johnson     • Delta Airlines
                         • Microsoft          • Medtronic             • Kraft Foods
• Lehman Brothers
                         • Avaya              • Bausch & Lomb         • General Mills
                         • Cisco Systems      • Baxter                • Chevron Corp.
                         • Google             • Amgen                 • Exxon Mobil
• Washington
                         • Hewlett-Packard                            • Ford Motor
Mutual                                                  Retail
                         • Intel Corp.                                • GM Treasurer's
• Liberty Mutual
                                              • Wal-Mart
                         •                                 • GMAC
• National City
                         • Paypal                                     • Eaton
• M&T Bank
                                              • Limited Brands
                         • Yahoo!                                     • DTE Energy
• Discover Financial
                                              • Sears
Services                                                              • PwC
                                              • Best Buy
                                                                      • E & J Gallo
                                                     Corporate Finance Timeline

September                 October                     November                   December
• Differences Between     • Wall Street Forum         • Interview Preparation:   • Mock-Interviews
IB, S&T, Corporate                                    Technical Questions        (Technical and Fit)
                          • Cover Letters
                                                      • Interview Preparation:   • Overall Polish and
                          • How to Conduct
• Overview: Timetable                                 Fit Questions              Presentation
                          Company Research?
• Overview: Functions                                 • Informational            • Bidding Strategy
                          • Resources Available at
                                                      Interviews: How to
• Overview: Industries    University of Michigan                                 • Thoughts for Winter
                                                      Reach Out to Recruiters?
• Networking Etiquette:
                                                      • Informational
How to Dress?                                                                    • Informational Interviews
                                                      Interviews: How to
• Networking Etiquette:                               Conduct the Interview?
Thank-You Notes                                                                  Ongoing
                                                      • Mock-Interviews
• Networking Etiquette:                               (Technical and Fit)        • Industry Speaker Series
Appropriate Questions
                                                                                 • Functional Speaker
• Corporate Finance                                                              Series
                                                                                 • Market Update
• List of Corporate
• Off-Campus Searches
• International
• Creating Your Story
• Drafting Your Resume
• Resume Review
                                            Skills, Career Paths, Life-Style
Skills Needed and Personal Traits
   Analytical / Problem Solving / Quantitative
   Leadership / Initiative
   Ability to see big picture and how the pieces fit
   Attention to detail
   Cross – Functional Skills (ie. ability to work across different functions)
   Multi-tasking
   Team player & good communicator
   Comfortable with ambiguity

Career Paths
   CFO
   Treasurer
   Business Unit Management
   Finance Director/Manager
   Controller

   The place to see and drive the big picture
   Good work/life balance
   High job security (relative to other Finance positions)
   Easily try different roles while building an array of transferable skills
   Less pay (especially bonus) than other Finance positions
      Corporate Finance Forum – September 19th
 One Stop Shopping for Corporate Finance Across
Industries: Financial Services, CPG, Retail, Defense…
 Various Corporate Finance Topics: M&A, Capital Investment,
Firm Financing Options, Corp Fin programs…
 Tremendous learning/networking experience – everyone
should attend! (IB, S&T, Corp. Fin., Research, PWM)
           8:30 A.M. - 5:30 P.M. - September 19, 2008
                         Michigan Union
Sales and Trading

                                       Sales & Trading Overview

 What is sales and trading?
    Salespeople work with customers on what is called “the buy-side”,
     selling them large amounts of securities like stocks, bonds or currencies
    Traders watch the market and trade orders for customers. The trader
     rarely talks directly to the customer
    The buy-side refers to the investment management firms, pension
     funds, hedge funds and trusts that buy stocks, bonds and other
     securities from the “sell side”
    The sell-side refers to Wall Street investment banks that sell stocks,
     bonds and other securities to the buy-side

       Individuals working in a sales & trading department of an
   investment bank are not investment bankers, nor do they work
   in investment banking. Instead, they are either sales brokers or
                  traders who work in sales & trading.
                           Skills and Traits for Sales & Trading

 How is sales and trading different from investment banking?
     Lifestyle, first-in-and-first out in the investment bank, never work on
     Work, pitch book, detailed financial modeling vs. entertain clients, work
      on trades

 Skills & Abilities                           Personal Traits
     Knowledge of financial services              High degree of motivation and
     Strong quantitative and analytical            energy
      skills, especially financial analysis        Composure and confidence
     Advanced oral and written                    Ability to think and act quickly
      communication skills                         Strong inter-personal skills
     Solid sales and marketing skills             Strong interest and academic
     Ability to work independently                 excellence in accounting, finance
     Team player                                   and corporate strategy
                                       Sales & Trading Overview

 Recruiting for Sales & Trading
    Mostly Self-Directed
    If you are interested in pursuing Sales & Trading opportunities please
    Damien McGough, VP of Sales & Trading
Research & Investment Management

                                                     Research Overview

 Buy Side (Asset Management)                          Lifestyle
 Manage Clients Money                                    Time - Not as long as
                                                           IB, but longer than CF
 Clients: Individual Investors, Pension Funds,           Weekends depends on
  Endowments, etc.                                         firm
 Example: Fidelity, Vanguard, Mutual Funds, Hedge        Travel depends on the
  Funds                                                    team
                                                             – Could be extensive
 Investment Horizon: Months, Years                          – Could be limited to
                                                               industry presentations
 Recruitment: Difficult, Competitive                     Work independently for
                                                           long stretches
   Sell Side (Equity Research)                           Once your in – your in
                                                          Numerous transferable
   Provide Liquidity & other services to Buy Side         skills
   Example: Citigroup, Lehman, Deutsche, Etc             Potential for large
   Investment Horizon: Days, Weeks                        bonuses
                                                          Great benefits
   Recruitment: “Relatively” Easy, Larger Firms
   Possible stepping stone position
                                          Skills & Traits for Research

 Skills & Abilities                          Personal Traits
     Strong communication skills                   Passion for the markets and
     Less quantitative than you might               investing
      think                                         Resilience – “Thick Skinned”
     Strong analysis and critical                  Disciplined
      reasoning ability                             Big picture thinking
     Ability to work independently                 Intellectual Curiosity
                                                    High degree of motivation and

                            Career Possibilities
                                                              Portfolio Manager

        Post MBA
                                                              Career Analyst
        Associate Analyst

                                                              Hedge Fund
Private Wealth Management

          Private Wealth Management (PWM) Overview
What is Private Wealth Management

 Usually is part of the Asset Management area of the banks/brokers.

 In broad lines is to develop investment strategies for High Net Worth

 Business model varies for each firm.

 It’s a “people” business.

 Even when markets are not good clients need people to take care of
  their money!
         Private Wealth Management (PWM) Overview

         Interpersonal   Analytical
          Private Wealth Management (PWM) Overview

 Somewhat self-directed, last year only GS and JPMorgan came on

 Recruiting process        Similar to IB.

 Very important to visit firms for Info sessions in NY and Chicago.

 Use the Alumni network.
   Private Wealth Management (PWM) Overview

 Top 5 Reasons to Summer in PWM:
5. You consider yourself a “people” person
4. You watch the financial markets (or at
   least you’ve heard of them)
3. You love a challenge – you won’t take “no”
   for an answer
2. You have an entrepreneurial spirit; you
   want to run your own company
1. Because you want to have a life outside of
   the office
Your Story, Resume, and Study Group

                                            Developing Your Story

 Your story should smoothly answer three questions:
    Where did you come from (your background)
    What are you doing now
    Where are you going (your future)
 Practice until your story becomes second nature
 Get feedback on your story from peers, second years and friends

      Introduction Version                 Two-Minute Drill
   Use when a brief introduction is    When a more detailed introduction
    appropriate                          is necessary
   10-15 seconds                       One to two minutes
   “Hello, I’m <Name> from…”           Same as short version, but with
                                         greater detail

      Your “story” is often the first impression you make with a
    recruiter. It critical to think and practice a great deal on what
           you want to communicate during that moment.
                                         Developing Your Resume

 Use Michigan format and resources
    Student Career Services>Develop Resume
 Action >Context > Result (ACR)
    Explain what you did, the work situation surrounding your
     responsibilities, and the results you achieved (quantified)
 Quantify result
    Size of transaction, sales generated, direct reports etc.
 Comprehensive flow of your history
    No breaks or gaps
 Introduce and explain private or non-US companies that recruiters
  may find unfamiliar

   You are intimately familiar with your work history, but a recruiter
    is not. Can a recruiter easily understand your work history in
                         just a minute or two?
                                                    Forming a Study Group

 Finance recruiting involves an incredible amount of work; even the
  most talented student has difficulty managing the process
 Study groups consist of a manageable (three to six) number of
  peers that are recruiting for the same function
 Study groups communicate or meet regularly to:
     Share information about events and networking opportunities
     Test and improve each others industry knowledge
        – Weekly market reviews, deals in the news etc.
     Improve each others recruiting skills (stories, resumes and interviewing)
     Help each other network during recruiting events
     Provide moral support during stressful periods

   A study group of peers recruiting together for a similar function
                     can be immensely valuable.
Recruiting Do’s and Don’ts

                                         Recruiting Do’s and Don’ts

 Do…
   Maintain a clean appearance at all times, including:
       –   Showering, Shaving, Trimming Nails and Hair
       –   Wearing Deodorant
       –   Wearing properly pressed, matching, and conservative clothes
       –   Err on the side of Business Formal
     Ask intelligent, thoughtful questions.
     Respect the time of Recruiters
     Write a simple, 1-2 line Thank You note
     Ask for a Business Card

                                       Recruiting Do’s and Don’ts

 Do NOT…
   E-mail or Contact Alumni at this point in the Recruiting Process
      – You will do more irreparable harm than good
      – Rely on your MBA 2 and Career Counseling classmates for assistance
   Ask Sub-Standard questions to Recruiters. These include:
      – Brain Teasers and extremely complicated questions involving calculations
      – Information that is available on the company’s website. Do your research!
      – Negative questions about the company or industry
   Crowd out colleagues
      – You will have many opportunities to interact with Recruiters
      – They will look down upon this action
   Attach Resumes to Thank You notes or Request follow-up meetings
   Give out your Business Card

                                               The Circles of Trust
Find information you trust as close to the center of the circles as possible

   Everyone                       Alumni                    Everyone
     Else                                                     Else


                    Career       Your Peers      Career
                  Counselors     and Study     Counselors


Outline of Available Resources

                                    Outline of Available Resources

 Finance Club
    Webpage, weekly meetings and workshops
    Resume reviews, mock-interviews and meet the interns
    Forums (Corporate Finance, Wall Street, London & Asia)
 Student Career Services Website
    >Job Database
    >Conduct Self-Assessment
       – Vault & Wet-Feet Guide
       – **Investigate Careers** (includes job descriptions and sample course paths)
    >Develop Resume
       – Resume Manual, Resume Guide w/ Examples
       – Cover Letter Guide w/ Examples
 OCD Counselors – they are Finance Club members too!
    Student Career Serves Website > Career Counseling
    General counseling, resume reviews and mock-interviews
    Come prepared!
                   Outline of Available Resources (cont’d)

 Kresge Library Resources
    Ross School of Business Homepage>Kresge Library>A to Z Databases
       –   Standard & Poors NetVantage (industry and company overviews)
       –   Factiva (in-depth news)
       – (insider information and guides)
       – (insider information and guides)
    Resume Books
       –   Resume books from prior years are available on two hour reserve
       –   Find resumes for people with similar backgrounds
       –   Read resumes for people that went into your desired function
       –   Apply lessons to your own resume
    Periodicals
       – Daily and weekly subscriptions to relevant newspapers and magazines
            – Wall Street Journal
            – New York Times
            – Economist
            – Business Week
       – Free (no need to have your own subscription!)
Upcoming Events

                                           Upcoming Recruiting Events
   September 8th
       Deloitte & Touche Office Hours – Investment Banking, Corporate Finance
        –   10:00 a.m. – 2:00 p.m.
        –   MBA2
        –   Executive Residence North – 1st set of Tables
        –   Business Casual
                                     Upcoming Recruiting Events
   September 9th
       Piper Jaffray Presentation – Investment Banking
        –   5:00 p.m.
        –   MBA1 & MBA2
        –   Room E1530
        –   Formal Attire
       FTI Consulting Presentation – Specializes in Restructuring, M&A advisory
        –   7:00 – 8:30 p.m.
        –   MBA1 & MBA2
        –   Room E0530
        –   Formal Attire
       FMC Biopolymer Presentation – Corporate Finance
        –   5:30 – 7:30 p.m.
        –   MBA1 & MBA2
        –   Pizza House
        –   Business Casual Attire
                                        Upcoming Recruiting Events
   September 10th
       Citi Global Transaction Services – Corporate Finance
        –   11:30 – 1:30 – Information Session in Student Lounge
        –   7:30 – 9:30 p.m. – Happy Hour @ Arbor Brewing Company
        –   MBA1 & MBA2
        –   Business Casual Attire
                                          Upcoming Recruiting Events
   September 11th
       Citi Global Transaction Services Office Hours – Corporate Finance
        –   9:00 a.m. – 4:00 p.m.
        –   Executive Residence South – 2nd set of Tables
        –   MBA2
        –   Business Casual Attire
       GM New York Treasury – Corporate Finance
        –   11:00 a.m. – 1:00 p.m. – Office Hours – W2736
        –   7:00 – 8:30 p.m. – Presentation – E0530
        –   MBA2
        –   Business Casual Attire
       Citi Consumer and Corporate Presentation – Corporate Finance
        –   5:00 – 6:30 p.m.
        –   E0540
        –   MBA1 & MBA2
        –   Business Casual Attire
                                           Upcoming Recruiting Events
   September 12th
       Meet the Companies Event
        –   MBA 2’s and Evening MBA’s in Final Year
        –   Michigan League Ballroom
        –   See Event Calendar for Companies Represented
        –   Includes Companies recruiting for Various Finance Positions
            –     Ameriprise Financial
            –     Chicago Trading Company
            –     Citi
            –     Centennial Group
            –     Discover Financial
            –     Duff & Phelps
            –     FDIC
            –     Morningstar
            –     M&T Bank
            –     Many Others….
                                    Next Finance Club Meeting
   September 14th
       MBA1 - IB/S&T/Corp Fin/PWM - Q&A panel or event with MBA2s
       6:00 p.m. – 7:30 p.m. – Room E0540

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