Finance related careers.
Finance Careers
Here's a brief description of more than 25 different finance career paths you can pursue. Be sure to click through and meet the Toigo Alumni listed for select careers and see how what they studied as undergrads, and what advice they offer for young professionals considering a career in finance.
Alternative Investments – Professionals focused on alternative investing often utilize strategies that are uncommon relative to mutual fund investment professionals. Examples of alternative investment strategies include long--short equity, event driven, statistical arbitrage, fixed income arbitrage, convertible arbitrage, short bias, global macro, and equity market neutral.
Analyst / Investment Banking – As an investment banking analyst, your role will be to help private and public companies, governments and institutions raise and manage capital. The typical areas within a major investment bank include Research, Corporate Finance, Private Banking, Fixed Income, Sales & Trading, and more. Investment banks also assist public and private corporations in raising funds in the capital markets (including both equity and debt offerings), as well as in providing strategic advisory services for mergers, acquisitions and other types of financial transactions.
Asset Management – As an asset management professional, you will work with a team and be responsible for investing capital from pension funds, institutions and high net worth individuals. Whether your client is an institution or an individual, your focus is on providing guidance about how and where to invest the client’s funds. As part of the process, you will consider the long- and short-term goals, the client’s risk profile, and economic and industry trends. The ultimate goal is to provide an investment strategy that delivers high, consistent returns to your clients.
Business Development – As a business development professional, you’ll be responsible for identifying, researching, analyzing and bringing to market new businesses and new products. You’ll focus on implementing your company’s (or team’s) strategic business plan through equity financing, acquisition/divestiture of technologies, products, and corporate acquisitions. You’ll help establish strategic partnerships and, in some cases, manage those relationships.
Consulting – As a consultant, you will provide professional advice to clients (typically large
pension funds, plan sponsors and public institutions), based on your understanding of the marketplace, the qualifications/expertise of investment professionals and your client’s needs. You will also serve as intermediary between your clients and investment professionals—helping clients identify the right group of professionals to help meet the stated investment objectives. Consultants are typically self-employed or employed by consultancy firms. Consulting within the financial advisory arena differs from management consulting, a field in which you would provide strategic business advice to Fortune 500 corporations.
Corporate Finance – As a corporate finance professional within the field of investment banking, you’ll work as part of a firm’s team serving a range of clients (including companies, institutions and governments) and managing a wide range of financial opportunities. You’ll represent clients in financial dealings ranging from raising capital (including IPOs) and negotiating financings to orchestrating M&As and reconstructions, issuing bonds (debt) and shares (equity). Your scope may also include lending money, supporting privatizations for government, and managing initial public offerings (IPOs).
Corporate Finance (internal) – Corporate finance is also a function within companies in all industries, from consumer products and health care to high technology and finance organizations. As part of the finance team, you’ll manage the overall policy and strategy for the company’s capital structure, budgeting, acquisition and investment, dividends and taxation. Professionals who work in-house as part of the corporate finance team tend to have more manageable schedules than their colleagues in the corporate finance department of a Wall Street investment firm.
Corporate Treasury - The corporate treasury department works closely with the CFO, Treasurer and other members of senior management to manage a company’s funding, liquidity, capital and relationships with creditors, rating agencies and regulators. Corporate Treasury plays a key role in the finance firm’s strategic and analytical projects, and provides unique insight into risk/reward management.
Financial Advisory – As part of a financial advisory team, you will serve as your clients’ primary resource for financial advice, providing personal investment strategies and advice. Through a series of discussions with your clients, you’ll help them identify an investment style that balances their goals and appetite for risk. Once a plan has been established, your role is to help your clients manage their investment decisions and stay on course. Areas of advice might range from insurance (life) policies to college savings and retirement planning.
Hedge Funds – Hedge funds are alternative investment firms that utilize high-risk investment strategies and techniques, such as borrowing money and selling short, in an effort to realize extraordinary capital gains for its investors. As part of a hedge fund team, your responsibilities will be to identify and orchestrate highly leveraged investments.
Institutional Marketing/Sales – As an institutional marketing/sales professional (“institutional” means that you have access to large investors, such as pension funds, with substantial amounts to invest), your career will focus on marketing a range of financial products and services to institutional clients, including organizations like private hospitals, schools, churches, and libraries whose objectives differ from those of traditional businesses.
International Finance – Within a firm, the International Finance branch examines foreign
investment, foreign capital budgeting, and exchange rates (including their impact on international trade), in order to capitalize on opportunities in the international arena that will benefit the company. The team often helps the company navigate complex international accounting standards, tax and reporting regulations.
Investment Management – Investment management professionals are responsible for day-today management of client’s (usually an institution) based on agreed upon goals. At many finance firms, investment management professionals might be in teams known as asset management, fund management, wealth management, portfolio management or money management. Professionals in this field are typically analytical, decisive, focused, driven, attuned to the market, and organized.
Leveraged Buyouts (LBOs) – LBO firms acquire companies using borrowed money (bonds or loans). The company being acquired then uses its own assets as collateral for the loan with the goal that future cash flows will cover the loan payments. As part of the LBO team, your responsibilities will range from identifying acquisition candidates, negotiating and structuring the deals and managing ongoing relationships. Like venture firms, many LBO firm principals take an active role in the management and restructuring of the company—all with the goal of growing their investment potential. LBO acquisitions often use a 90:10 debt to equity ratio—with this high debt/equity ratio, the bonds are usually not investment grade bonds, but are referred to as junk bonds.
Mergers and Acquisitions (M&A) – M&A professionals thrive on the deal, working as part of a team charged with identifying, analyzing and orchestrating the purchase of a company, or the merger of their company (or client) with another business. The goal is to provide all stakeholders with increased shareholder value (ie, through economies of scale/operations, expanded market or manufacturing strength, etc) due to the combination. Acquisitions involve one company absorbing another, while mergers involve an agreement between two companies to become a single (new) company.
Pension Fund/Plan Sponsor Investment - Pension funds are established by employers, and plan sponsors by government entities (such as states, cities, or other municipalities), unions and other associations to invest the retirement funds of the group’s employees or member’s retirement funds contributed by the employer and employees. As an investment professional working for a pension fund, your responsibilities will include investing the fund’s capital (or common asset pool), all with the goal of generating stable growth over the long term.
Philanthropic Advisory – As a member of a philanthropic advisory services team, you will advise individuals, community funds, families, corporate and employee donors, and foundations on how best to fulfill their philanthropic goals. Through researching giving opportunities, developing grant-making initiatives, providing program and management services, evaluating resources, and creating individualized portfolios that help manage assets, you will enable your clients to achieve their fundraising and/or giving objectives.
Portfolio Asset Management – As part of a portfolio management team, you’ll help decide how to allocate your clients’ portfolios, taking into account risk issues, market and economic conditions. Selection involves determining what assets to purchase, fund allocation, timing issues, portfolio rebalancing and divestment planning and orchestration.
Portfolio Fund Management – As portfolio fund manager (or part of a fund management team), you will be making decisions about investment mix and policy, matching investments to objectives, determining asset allocation for your clients (including individuals and institutions). Oftentimes, the scale of the investment decisions is in the high million-dollar range. As a fund manager, you will be responsible for investing the mutual fund's assets based on its established investment style (value or growth, for example), and managing the day-to-day portfolio trading of the fund. There is one key metric of your success—the quarterly, one-year and five-year returns posted by the fund.
Private Client Services / Private Wealth Management – As a private client services
professional, you will provide comprehensive wealth management solutions and responsive day-to-day service to clients with anywhere from $5 to $50 million in net worth. Private Client Services helps customers protect and grow their wealth by addressing key investment decisions, philanthropic endeavors, tax issues, and more.
Private Equity – Private equity professionals manage funds on behalf of limited partners (LPs), investing in companies with goal of realizing a high rate of return (typically 3x-7x). Private equity is capital that has been made available to companies separate from the public markets, such as stock market. The funds raised through private equity are often used to develop new products and technologies, to expand working capital, to make acquisitions, or to strengthen a company's balance sheet. Oftentimes, the private equity partner actively advises the management team on key business strategy issues, and holds a seat on the company’s board of directors. Once a liquidity event occurs—the company is sold, acquired or goes public—the private equity firm realizes a return that is shared by the partnership and the firm’s limited partners.
Public Finance (municipalities) – Professionals in public finance arena often work for
municipalities or states and are charged with managing those entities capital resources.
Real Estate Acquisitions – As a real estate acquisitions professional, you will be involved in prospecting, structuring, underwriting, negotiating, and closing real estate deals. You will conduct due diligence for acquisitions, as well as analyze financing, cash flow models, leases and other associated documents, real estate portfolios, and market trends. Professionals working in Real Estate enjoy independence and flexibility, as well as the opportunity to specialize in areas like urban planning, commercial brokerage, land development, appraisal, or property management. Common traits of professionals in this field include strong communication skills, experience and interest in research, and the ability to conduct detailed and accurate analyses.
Real Estate Development – As a real estate development professional, you will be involved in designing and executing concepts, monitoring multiple development projects, analyzing and maintaining financial spreadsheets that monitor returns, conducting market and project research, and negotiating leases. Development professionals are generally risk-takers, goal-oriented, charismatic, and budget time well. In this business, income is often based on success, and many developers are paid in straight commission. Positions within this department include analyst, associate/project manager, vice president/managing director, and developer.
Real Estate Investment – Real estate investment professionals are responsible for investing in real estate property on behalf of their clients. They review potential investments and make investing recommendations to their clients based on their analysis. Professionals in this field typically possess strong analytical skills, communication skills, and have the ability to synthesize large amounts of data.
REITS – As a real estate investment trust (REIT) investment professional, your firm would offer common shares of your investment fund to the public. In this way, a REIT stock is similar to any other stock that represents ownership in an operating business. However, a REIT has two unique features: its primary business is managing groups of income-producing properties and it must distribute most of its profits as dividends. Your primary business focus would be managing groups of income-producing properties and distributing profit (less your firm’s fees) as dividends to your shareholders.
Sales & Trading – Sales & Trading professionals focus on buying and selling within the
secondary market, i.e. purchasing existing financial products and securities from investors rather than issuing companies. Professionals in this field are often the first to arrive at work and the first to leave (their day ends shortly after markets close for the day). The tempo on the trading floor is fast-paced—and oftentimes chaotic.
Social / Micro-Finance – Social finance is a growing area within many investment and
commercial banks that focuses on providing capital access to underserved markets, including communities and/or individuals in the third-world. Microfinance enables these individuals to access small loans (larger loans become available based on repayment history) with quick disbursement turn-around. The goal of microfinance is to reduce poverty, improve quality of living, and increase self-sufficiency.
Venture Capital – As a venture capitalist, your focus is on investing in emerging and middle market companies on behalf of your firm’s limited partners. You’ll work with your portfolio company teams to set strategy and grow the business—all with the goal of realizing liquidity (and profit) via an initial public offering (IPO) or acquisition. Select members of the venture fund team (typically the more senior partners) lead the firm’s fundraising efforts and interactions with institutional investors.
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