Investment Management: Choosing The Right Degree For Success

Investment managers are responsible for overseeing the money that individuals and institutions have made available for investments, with the goal of growing their assets. To become an investment manager, a bachelor's degree is typically the minimum requirement, preferably in a field such as business, economics, accounting, finance, or mathematics. However, it is becoming increasingly common for employers to prefer candidates with a master's degree, particularly a Master of Business Administration (MBA). In addition to academic qualifications, certain certifications, such as the Chartered Financial Planner (CFP) certification, are highly valued in the industry.

Bachelor's degree

A bachelor's degree is the minimum requirement for a career in investment management or banking. While a college degree is not strictly necessary, it can be helpful for showcasing your skills and expertise. A bachelor's degree in a field like business, economics, accounting, finance, law, or mathematics can provide a good foundation for a career in investments.

Pursuing a bachelor's degree in a relevant field can equip you with the knowledge and skills needed to succeed in the investment industry. For example, a degree in economics can help you understand the volatile nature of the stock market and how it is influenced by the economy. A degree in statistics can provide valuable skills in data analysis and probability, which are essential for stock trading. A bachelor's degree in data analytics can also be beneficial, as it covers topics that overlap with economics, statistics, computer science, and information technology.

During your bachelor's degree, it is important to develop essential skills such as critical thinking, technical proficiency, strategic planning, and communication. These skills will enable you to analyse financial data, make informed investment decisions, and effectively communicate complex information to clients. Additionally, consider completing courses in risk management, estate planning, taxes, and investments to further enhance your knowledge in the field.

While a bachelor's degree is a common entry point, many employers now prefer candidates with a master's degree, such as a Master of Business Administration (MBA). An MBA can provide you with in-depth knowledge of corporate management and financial concepts, making it a valuable asset for career advancement. It is also common for investment professionals to have certain certifications, such as the Certified Financial Planner (CFP) certification, which can enhance your credentials and demonstrate your commitment to ethical practices.

Master's degree

A master's degree is highly valued by employers in the investment management field and can lead to more senior positions and higher salaries. While a bachelor's degree is the minimum requirement for an investment manager, most now hold a master's degree, particularly an MBA.

A master's degree in a field such as finance, economics, accounting, business administration, or a related subject is ideal for aspiring investment managers. This provides a strong educational background and equips graduates with the necessary skills and knowledge to make informed decisions and effectively manage funds.

In addition to a master's degree, gaining relevant work experience is crucial. Many investment fund managers start in entry-level positions such as financial analysts, portfolio managers, or traders. This experience provides valuable knowledge of financial markets, investment strategies, and risk management.

Furthermore, obtaining professional certifications such as the Chartered Financial Analyst (CFA) or Certified Investment Management Analyst (CIMA) designations can be beneficial. These certifications demonstrate expertise in investment analysis, portfolio management, and ethical standards.

Pursuing a master's degree in a relevant field, gaining practical experience, and obtaining industry certifications are key steps to becoming a successful investment manager.

Internships

Types of Internships

Investment internships can vary in their focus, ranging from investment banking, asset management, and wealth management to more specific areas like climate investments, venture capital, and private equity. Some internships may be rotational, allowing you to explore different areas within investment management.

Responsibilities and Learning Opportunities

As an investment intern, you may be involved in a variety of tasks and projects. These could include conducting market research, assisting with investment decisions, creating investment decks, analysing investment strategies, and supporting senior investment professionals. Internships often provide a unique perspective on the day-to-day work of investment managers and advisors.

Skill Development

Building a Professional Network

Academic Requirements

Most investment internships require candidates to be enrolled in or have completed a bachelor's or master's degree in a related field, such as business, economics, finance, or a similar discipline. Some internships may also be open to current MBA students seeking to specialise in investment management.

Location and Duration

Investment internships are often offered during the summer, typically lasting around 8-10 weeks. They are commonly available in major financial hubs, such as New York, Boston, Mumbai, and London. However, remote and hybrid work arrangements are also becoming more prevalent, providing greater flexibility for interns.

Application Process

The application process for investment internships can be highly competitive, so it's essential to stand out. Customise your resume and cover letter to highlight relevant skills and experiences. Demonstrating a strong interest in the industry and a passion for investments can set you apart. Be prepared to showcase your analytical capabilities and your understanding of the investment landscape during interviews.

Example Internship Opportunities

• Summer Analyst Programme at Goldman Sachs: A 9-10 week summer internship for students pursuing a bachelor's or graduate degree, offering exposure to investment banking or equity research.
• Investment Banking Intern at Howden Group Holdings: Interns gain skills by working with junior and senior bankers, participating in transaction executions, and preparing client presentation materials.
• Investment Management Intern at Berkshire Residential Investments: This internship involves conducting market research for new investment opportunities and includes a dedicated mentorship programme.

Networking

Informational Interviews:

Informational interviews are a great way to build connections with investment bankers over time. Start by finding bankers' names on LinkedIn or through your school's alumni network. Then, research their email addresses and key information about them. Reach out and request an interview, following up 2-3 times if necessary. Prepare for the call by conducting research, and spend most of the interview listening and asking questions about their career. Ask for tips on your job search and make a "mini-ask," such as passing along your resume. After the interview, send updates and make your "real ask," directly requesting that they plug you into their firm's recruiting process.

Cold Emailing:

Cold emailing is effective, especially for early university students, incoming MBA students, or recent graduates. It involves directly asking about open positions. Find the email addresses of investment professionals and craft a concise and personalised email. Be prepared to follow up multiple times, as you may initially receive a "no" response.

Cold Calling:

Cold calling is less successful than cold emailing, and it tends to work only for undergraduates and recent graduates at boutique firms. It can be repetitive and has a low success rate. However, if you choose to cold call, get a list of banks or bankers in your area, plan your pitch, and be ready to respond to objections. Follow up at least once a week until they tell you to stop calling.

Face-to-Face Networking:

Face-to-face contact remains one of the best ways to land a job in investment banking. Attend networking and recruiting events, especially those hosted by your dream employers or larger investment banks. Take advantage of internships and financial analyst jobs to build connections. Set up informational interviews or meetings with investment bank professionals to learn about the hiring process and timelines. Coffee chats or drinks with current employees, especially those in the investment banking division, can also be valuable.

Alumni Networks:

Alumni networks are a powerful resource for students and young professionals. Access your school's alumni network through the Career Resource Center or its online system. Reach out to alumni in the investment banking field by sending a polite email requesting career advice and a conversation about the industry. Build relationships and let them get to know you before asking for referrals or recommendations.

Prioritise Networking Events:

With many networking events during the hiring season, it's essential to prioritise those crucial to your job hunt and dream job. Target events that align with your skills and interests. For example, if you specialise in risk management, look for events hosted by firms like BlackRock. If you have a generalist skillset, cast a wider net and consider virtual or hybrid regional and international events.

Make the Most of Campus Events:

Leverage Mutual Connections:

Break the Ice at Events:

Walking into a room full of strangers can be daunting. At physical events, look for groups with an odd number of people, as it's easier to join their conversation. Introduce yourself and take advantage of social niceties to initiate interactions. For virtual events, wait for a lull in the conversation or pipe up if you know the answer to a question.

Mix Work and Non-Work Topics:

Remember that investment bankers are humans too, and they have interests beyond work. Pay attention to hobbies or sports teams they mention, and use this information to start conversations at networking events. Don't be afraid to suggest a quick coffee break to mix non-finance topics into your discussions.

Follow Up on New Contacts:

Getting someone's contact details is just the first step. Follow up immediately after meeting new contacts. Let them know you'll call or email with questions or to continue the conversation. Set up a coffee meeting and be punctual. Be genuine in your interactions and avoid coming across as pretentious.

Keep Track of Your Network:

As your network grows, keep track of your connections. Do some background research and use a folder or planner to organise their information, such as positions and firms. Set up alerts for your contacts to stay updated on their achievements and send congratulatory messages. Regularly follow up with your connections to maintain the relationship.

Licensing

In the US, the Financial Industry Regulatory Authority (FINRA) issues investment licenses. These licenses are required to ensure that investors do not unknowingly invest in anything fraudulent and to give investors a detailed view of how the market works and any associated risks.

There are four main types of investment licenses:

• Individual or Personal Investment Licenses: Individuals with this license are considered to be acting in a fiduciary capacity and will be held legally accountable for their actions. To obtain this license, you must pass the Series 7, Series 63, Series 66, or Series 9 exams.
• Corporate Financial Investment Licenses: Individuals with this license are considered to be acting in their business capacity rather than as an individual. They will not be held legally accountable and will not be liable for any actions taken. To obtain this license, you must submit your articles of incorporation or certificate filing, as well as specific forms and meet certain capitalization requirements.
• Investment Banking Licenses: This type of license deals directly with securities and allows individuals to buy and sell stocks or bonds on behalf of clients or companies. To obtain this license, you must pass the Series 7, Series 63, and Series 86 exams. It is also required that individuals holding this form of license have a bachelor's degree in Financial Economics, Business Administration, Finance, or a related field, or two years of full-time work experience in a business-related field.
• Legal Entity Investment Licenses: This license applies to corporations that issue securities and individuals who own more than 10% of the total shares of a corporation. It is issued by the Securities and Exchange Commission (SEC) and allows companies to raise funds for their operations and facilitate growth. To obtain this license, you must pass the Series 65 or 66 exams.

In addition to the above, there are several common licenses that financial advisors can obtain:

• Series 6 License: Allows advisors to sell packaged securities or investment products such as variable annuities and mutual funds.
• Series 7 License: Allows advisors to sell almost every type of investment product, including stocks, bonds, options, futures, and packaged securities.
• Series 63 License: Required to conduct business within a state's borders.
• Series 65 License: Required for financial advisors who receive payment in the form of fees instead of commission.
• Series 3 License: Allows advisors to sell real estate, life insurance, and commodities.

All investment bankers are required to obtain a license from FINRA, which gives them the right to sell investment products and services. This involves passing a series of qualification exams and enrolling in continuing education to maintain industry standards and practices.

In Canada, individuals who sell financial products or have specific duties within a financial services company, such as portfolio management, are required to meet educational, ethical, and sometimes work experience criteria to be licensed. The licensing bodies and regulators include the Canadian Investment Regulatory Organization (CIRO), Autorité des Marchés Financiers (AMF), Canadian Securities Administrators (CSA), and Canadian Council of Insurance Regulators (CCIR).

Frequently asked questions