Investment Banking Interview Questions – Preparation Guide

Investment Banking Interview Questions – Preparation Guide

OK, picture this: These investment banking interview questions are fired at you now in quick series by two investment bankers sitting opposite you. Are you capable of answering them on-cue, right now?

“How would you calculate the value of a bond?”

“What stocks do you follow?”

“Do you play golf?”

“What’s the best idea you’ve had and how will you top it?”

“What is put-call parity?”

“Ever found a inventive solution to a complicate problem?”

“Without using paper, what is 17 x 8.5?”

If you can’t answer these now, I’ll be honest, your chances are slim. These are only a FEW of the 80+ questions you could get asked at your investment banking interview. And you only get one chance to make your impression on these busy people!

Now, let me give you a associate of form questions and answers that are taken right out of my eBook.

If the interviewer asked me about a time when I had been in a leadership position and there was a difficult member of the team who was causing some aggravation, and how I handled the situation, I would say:

“I decided to sit him down and outlined his specific skills, which were X, Y and Z. I told him that the team needed his skills and of course, his valuable input. I reminded him of how exciting it would be if the team achieved our goal. I kept a friendly attitude and carefully addressed the fact that his attitudes/actions were not congruent with what I knew he was capable of and reminded him of his past successes. The meeting ended on an vigorous observe and he assured me of his commitment; he only had to be reminded of why the goal, and why working with our team with his specific skill, motivated him. He was quickly back on track achieving A, B and C, and ended up a great person to work with. I was proud to have him on our team.”

Here’s what I would say when asked a question like “What is Beta?”:

“Well, beta is a measure of the sensitivity of a security’s return in relation to the market. If a stock has a beta of more than 1, it method that it is more volatile, or “swings more” than the market. And if a stock has a beta of 1, it is as risky as the market. If the beta is less than 1, the stock moves less than the market. But if a stock with a higher beta and consequently a higher risk would also indicate a higher return and vice versa. Basically, a stable blue-chip would have a beta of close to 1, where a volatile bio-tech firm would probably have a beta of more than 1.”

Do you see how easy it is once you have the form answers?

Here’s the secret. You don’t need overcomplicated theories that take countless hours to learn before you know how to answer investment banking interview questions []!

All you need is some structure and a cheat sheet. So keep that in mind before you go to your investment banking interviews: it might make the difference between having a high-flying career in investment banking or however, that devastating rejection letter.

I wish you the best of luck in your interviews, and hope this article will help you answer some of the tough investment banking interview questions you will soon confront. If you’d like more, be sure to check out my eBook at my website, which you can download and start reading in the next five minutes.

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