Monday, January 30, 2023

Investment Banking Interview Prep Course

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What Are The Major Factors That Drive Mergers And Acquisitions

Investment Banking âFitâ? Questions: Quick Prep

Sample Answer: Major factors that justify mergers and acquisitions are:

  • Diversifying or sharpening the focus, market, or products of the company
  • Gaining access to new technologies
  • Eliminating a competitor from the market or growing market share
  • Increasing Supply-Chain pricing power by buying a supplier or distributor
  • Improving financial metrics and numbers

Can You Guarantee That I Will Get The Offer

We cannot guarantee that you will get the offer. The engagement is purely for educational purposes. Our engagement is to coach you and help you present the best of yourself to firms. We have a very strict business ethics standards and conflict of interest policy and do not participate in guaranteed arrangements of any kind.

The Complete Investment Banking Course 2020 By Udemy

The Complete Investment Banking Course 2020 is perfect for those who already have some base knowledge of investment banking and seek to sharpen their skills to get a job. It can also be helpful to those who are simply looking to brush up on their knowledge before an upcoming interview.

This course is available on Udemy and boasts a 4.4 average rating, with more than 40,000 students taking this class thus far.

This course offers overview questions on the major areas of investment banking, including LBOs, M& A, IPOs, bonds, and more. A comprehensive section on how to ace a potential job interview is also included.

Eight and a half hours of online video lessons, two articles, and 156 downloadable resources make up this course.

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What Is Wacc And How Do You Calculate It

Sample Answer:WACC is the acronym for Weighted Average Cost of Capital. It reflects the overall cost for a company to raise new capital, which is also a representation of the riskiness of investment in the company . It is commonly used as the discount rate in a discounted cash flow analysis to calculate the present value of a company’s cash flows and terminal value.

The formula below helps you calculate the WACC of a company if you are put on the spot and asked to calculate it as part of your technical interview:

where,E = Market value of equityD = Book value of debtP = Value of preferred stockKE= Cost of equity KD = Cost of debt KP = Cost of preferred stock T = Corporate tax rate

Sample Answer:EBITDA stands for Earnings before Interest, Taxes, Depreciation, and Amortization.It gives us a good idea of a company’s profitability and is a quick metric for free cash flow because it will allow you to determine how much cash is available from operations to pay interest, CAPEX, etc.

EBITDA = Revenue – Expense

It is also often used for rough valuations in a comparable company or precedent transaction analysis as part of the EV/EBITDA multiple.

What Are The Questions Asked In Hirevue Interviews

Investment Banking interview guide to Barclays Libor scandal ...

Hirevue aims to predict your capabilities for the job you’re applying for based upon your soft skills and presentation of yourself during the interview. As such, the interview consists of a majority of behavioral questions , with some banks not even asking a single technical question to candidates.

The following is a list of 15 sample questions Hirevue has previously asked candidates during interviews, credit to The University of Colorado.

  • Tell me a little about yourself.
  • What are your long-term career plans?
  • What made you leave your previous job?
  • Tell me about your strengths and weaknesses.
  • Why do you want to work here?
  • What makes this position a good fit for you at this point in your career?
  • Tell us how your experience and training have prepared you for this position.
  • Give us your understanding of our organization
  • Tell us about a time when you had to balance multiple priorities. Please give an example that demonstrated how you navigated completing work priorities to attain the best result.
  • Describe a work scenario in which you were faced with competing priorities. How did you juggle them all and still meet everyone’s expectations?
  • Describe a high-pressure situation that you were put in unexpectedly. How did you adjust and still create a successful outcome?
  • Tell us about a time you were most creative.
  • What do you enjoy about working in customer service? What do you dislike or find challenging?
  • Explain your approach to completing multiple assignments in a workday.
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    Chartered Investment Banking Analyst

    One of the few professional certifications that have been custom built specifically for investment banking. The laser focus on IB is what earns this certification a spot on this list. The content is delivered online in a virtual classroom or classes may be attended in-person at a training center.

    All that you need to know as an IB analyst/ associate or even as a mid-level professional looking to make a career transition, is in here. The course is made up of five meaty modules that each covers a critical component of what you need to know as an Investment Banker:

    • Financial Accounting
    • Corporate Finance and Valuation Methods
    • Financial Modeling
    • Mergers & Acquisitions

    The next best thing to having real on the job deal experience. Having relevant work experience for finance roles is a chicken and egg problem. Certifications like this one that utilize detailed case studies and real world scenarios are your best shot at solving that dilemma.

    Investment Banking Prep Course By Efficient Learning

    • Who’s it for? Advanced

    Investment Banking Prep Course is offered by Joshua Pearl and Joshua Rosenbaum of Efficient Learning. Its a comprehensive guide for all levels of investment banking job candidates.

    This prep course covers the fundamentals of investment banking in bite-sized lessons, featuring a list of over 500 interview questions with answers, as well as interview training videos.

    Investment Banking Prep Course costs $545 and includes over 20 hours of online video lessons, as well as numerous downloadable resources.

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    Familiarize Yourself With The Firms Values

    Most investment banks have a list of values or a mission statement published on their website.

    Youre unlikely to be asked specifically about one of the firms values, but it can be helpful to know them, because it can help you frame your answers in a way that is aligned with how the firm operates.

    Here are relevant pages for the three leading firms:

    How Can A Company Raise Its Stock Price

    Investment banking interview preparation session by IB Institute

    Sample Answer:There are many ways a company can raise its stock price, a few of which are:

    • A company can repurchase stock, which lowers the number of shares outstanding and therefore increases its value per share.
    • It can improve operations to produce higher earnings, causing its EPS to be higher than anticipated by industry analysts, which will send a positive signal to the market.
    • It can announce a change to its organizational structure such as cost-cutting or consolidation, which would lead to increased earnings in general.
    • It could announce the institution of a dividend policy or an increase in an existing dividend.
    • It can announce an accretive merger or an acquisition that will increase earnings per share.

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    Walk Me Through A Dcf

    In an interview, it is important to keep your technical overview at a high level. Start with a high-level overview and be ready to provide more detail upon request.

    Sample Answer:

    • Project out cash flows for 5 – 10 years depending on the stability of the company
    • Discount these cash flows to account for the time value of money
    • Determine the terminal value of the company – assuming that the company does not stop operating after the projection window
    • Discount the terminal value to account for the time value of money
    • Sum the discounted values to find an enterprise value
    • Subtract the present value of debt and then divide by diluted shares outstanding to find an intrinsic share price

    Common questions that follow this are:

    Why do you multiply by ?

    Sample Answer:You do this because interest expense is tax-deductible so you need to account for the benefit provided by this “debt tax shield.”

    What is the cost of equity?

    Sample Answer:The cost of equity is usually calculated using the Capital Asset Pricing Model .CAPM = Risk-free rate + Beta *

    What is the exit multiple method for determining the terminal value?

    Sample Answer:Find an industry average multiple and multiply it by final year revenue or final year EBITDA .

    Best Investment Banking Courses Ranked By Bankers

    In Finance Courses & Certifications by Gaurav SharmaUpdated On: August 3rd, 2022

    Investment banking is notoriously hard to break into. Its not uncommon for recruiters to receive thousands of applications for a single Investment Banking job opening. In this sea of candidates, you need something to stand out. You need something that makes your CV pop. Something that shows you are committed to this career and you know what it takes. That is why stellar academics and building a perfect resume are essential. You need every advantage you can get.

    Success depends on a lot of factors and there are some you cant even control . But there is plenty you can and should do to get ahead. Soft skills, academics, extra curriculars, certifications etc. are all just part of the overall package.

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    Why Would A Company Issue Equity Rather Than Debt To Fund Its Operations

    Sample Answer:There are many reasons why a company would want to issue equity instead of debt. Some of them are:

    • If the company feels its stock price is inflated, it can raise a relatively large amount of capital with comparatively minimal dilution to existing shareholders.
    • If the projects the company is looking to invest in do not produce immediate or consistent cash flows to pay its debt.
    • If the company wants to adjust the cap structure or pay down debt.
    • If the owners of the company want to sell off a portion of their ownership.

    All Else Equal Should The Wacc Be Higher For A Company With A $100 Million Market Cap Or A Company With A $100 Billion Market Cap

    Wall Street Prep joins the IBP Institute to Build a CFA

    Sample Answer 1:Normally, the larger company will be considered “safer” and therefore will have a lower WACC all else being equal. However, depending upon their respective capital structures, the larger company could also have a higher WACC.

    Sample Answer 2:Without knowing more information about the companies, it is impossible to say. If the capital structures are the same, then the larger company should be less risky and therefore have a lower WACC. However, if the larger company has a lot of high-interest debt, it could have a higher WACC.

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    Teacher Reputation And Quality

    After youve selected a couple of courses that focus on the skills and topics that you want to be covered, you should next check the teachers knowledge and reputation.

    You can start this process by looking up testimonials and reviews by former students. You can typically find them on the courses summary or introduction page. If you find them to be negative or even unavailable, its a good sign to cross that class off your list and continue with the other potentials.

    The teachers standing among his or her peers is a good indication of a helpful class. Continue to pursue classes that have a great reputation. If no ones heard of your instructor, or if they arent looked upon favorably by past students, you should pass on that prep course.

    Common First Investment Banking Interview Questions: Crafting Your Story

    There are no excuses for not perfecting what is in your control. Irrespective of the bank, the position, or your region, you can be sure these 2 questions will be asked as they’re a standard in the industry.

    Anticipating both of these questions beforehand, crafting a compelling narrative around them, and selling yourself on it will make you stand out from amongst the pool of potential candidates.

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    Investment Banking Case Interviews

    While its not a universal experience for applicants to encounter investment banking case interviews, it does happen. As you move up the chain and interview for more senior positions, itll only become more and more likely that youll be met with a case question in your investment banking interview.

    So, its a good idea to start familiarizing yourself with the case interview process and ways to prepare. Luckily, Management Consulted has everything you need in the Complete Case Interview Prep Guide.

    What Is The Difference Between Cash

    Investment Banking 101: Course Overview

    Sample Answer:Cash-based accounting recognizes sales and expenses when cash flows in and out of the company.

    Accrual-based accounting recognizes revenues and expenses as they are incurred regardless of whether cash flows in or out of the company at that exact time.

    Accrual-based accounting is the more common method for large corporations.

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    Your Ability To Answer Technical Questions Competently And Prove That You Can Do The Work

    Technical knowledge is required to win offers. If you cant explain the financial statements, valuation, or DCF analysis, youve eliminated yourself before the interview even begins.

    Its not possible to learn everything at the last minute because there is a lot of material but you can focus on the most important concepts and use the quizzes and Excel files in this Interview Guide to make sure you know the ropes.

    Our Interview Guide is designed around these two critical topics.

    Yes, theres lot of other stuff in here fit/behavioral questions and answers, quizzes, practice case studies, industry-specific questions, deal discussions, and more.

    But if you answer questions in these two categories like a pro, the rest is icing on the cake.

    What Makes A Great Investment Banking Interview Prep Course

    When evaluating a course, the first thing to look at should be the topics and skills covered. Once you find that the course fits your needs, start investigating the reputation and the quality of the teachers. Once youve found a teacher that has great reviews, consider the price.

    Lets take a closer look at each requirement.

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    How Many Gas Stations Are There In The United States

    Answer:With a question like this, the interviewer is looking at your thought process, not that you can figure out how many gas stations are in the U.S.

    The easiest way to go about answering a question like this is to start small and work your way to the bigger question.Think about your town. Say your town has 30,000 people, and you have 5 gas stations serving that area.The United States has approximately 300 million people, so that means there are 10,000 “towns” in the United States, and 50,000 gas stations. You then want to make adjustments. For example, assume that a quarter of the population lives in larger cities where there is only 1 gas station per 30,000 people.So you have 7,500 towns with 5 gas stations and 2,500 “towns” with only 1.

    Do a little mental math and you get the number of 40,000 gas stations in the U.S.

    A Room With No Windows Has 3 Light Bulbs You Are Standing Outside With 3 Switches That Control Each Of The Three Bulbs If You Can Only Enter The Room Once How Can You Determine Which Switch Controls Which Bulb

    Looking to exit to investment banking. How do you go about preparing ...

    Answer:First, turn on two switches: call them Switch 1 and Switch 2. Leave them on for a couple of minutes to let them get nice and hot.Then, turn off Switch 1 and enter the room. The bulb that is lit should be the one that is controlled by Switch 2.Of the remaining two bulbs, the hot one is the one controlled by Switch 1. The last one, off and not hot, is controlled by Switch 3.

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    Wso’s Bonus Tips To Excelling In Hirevue Interviews:

    • Dress appropriately This is pretty self-explanatory, make sure you are dressed well and look presentable.
    • Rehearse and practiceYou’re at an advantage with Hirevue as you can anticipate which questions are going to be thrown at you. Prepare for these questions beforehand, rehearse and practice your stories. Record yourself and replay it, find places to improve, and repeat the process until you are able to consistently and confidently answer questions. Ideally, the actual Hirevue interview itself should simply be a rehearsal of your past practice sessions, nothing should be catching you off guard. If you want the upper hand, ask your close friends and other respectable people in the industry to review your recordings and offer feedback. Perfect your delivery, practice makes perfect.
    • Adopt good speaking practicesAdjust your audio settings well in advance, and ensure your voice is clearly transmitted through the microphone. Maintain eye contact with the camera, straighten your posture and deliver your answers with confidence.

    If You Could Use Only One Financial Statement To Evaluate The Financial State Of A Company Which Would You Choose

    Sample Answer:The cash flow statement because it shows the actual liquidity of the company and how it is generating and using cash. The balance sheet just shows a snapshot of the company at a point in time, without showing the performance of the company, and the Income statement has several non-cash expenses that may not be affecting the company’s health and can be manipulated. Overall, the key to a great company is generating significant cash flow and having a healthy cash balance, both of which are disclosed in the CF statement.

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    The Investment Banking Interview Process

    The overall process of completing interviews varies based on your location and the level of roles youre applying to .

    If youre in North America and youre applying to Analyst roles, the investment banking interview process usually goes like this:

  • Network months in advance and submit your application online.
  • Complete a HireVue or other pre-recorded video interview, or possibly a phone interview with a human.
  • Then, come into the banks office for a Superday, where you interview in-person with many bankers at all levels .
  • If you get an offer, youll hear back quickly if not, they may not say anything, or they may drag out the decision.

    At the MBA level , its similar, but banks tend to focus on on-campus recruitment at the top business schools.

    If youre applying outside of these formal processes for example, youre working at a Big 4 firm or valuation firm and you apply for full-time IB roles then the process will be a series of interviews over a long period, with unpredictable timing and less reliance on HireVue and other automated assessments.

    For more, see our HireVue interview guide.

    Real interviews are far more challenging because they could ask you anything, and theyll judge not only your responses but also your body language and cultural fit with the group.

    In Europe, and especially the U.K., this process is different because:

  • You will have to complete online math, logic, and verbal tests, along with competency questions and
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