What Is an Investment Banking

What Is an Investment Banking
As the credit crisis unfolds, I've heard a lot of investors to the question "What is the investment bank, is not like at regular intervals, the difference between commercial banks' What is it?" You are before starting work in Unless the global financial crisis, can not run in your bank for long-term investment. investment banks, in short, you can get a business loan, the agency is like the corner has been used to deal with salary savings. Instead, capital markets, investment banking (corporate bond market and stock market if, for example), facilitating access to the company to raise funds to meet the needs or other expanding finance higher This is a special type large financial institutions to operate. If you want to sell Coca-Cola worth $ 100 billion in bonds to build a new bottling plant in Asia, investment banks, along with a team of lawyers and accountants to find a buyer for their debt, to help manage documents it.
Over the next few minutes, the investment banking and how to make money, help you learn to experience one of the biggest financial crisis in the history of that.

A typical investment banking A typical investment bank, engaged in some or all of the following:
• raise capital (eg IPO to create a special class of preferred shares may be placed on sophisticated investors such as banks and insurance companies to launch and support)
• raise debt financing (such as issuing bonds to raise funds for the expansion of the factory)
• Bond or insurance (credit default swaps, etc,) to launch a new product
A group of companies engaged in money management • investment banking, investment and gold and the option of getting the gold mine company, have private accounts that would be of speculative gold futures (for example, the retention time to buy bullion Fri unconditionally secure trading their own money on their holdings for trading.) Ten years ago, the U.S. investment bank, the activities we have very good profit if we became part of the big commercial banks were not allowed to, money from loans from traditional commercial banks raised the risk of very more. If the rest of the world was not. Countries like Switzerland, in fact, many investors, the combined bank, securities, cash management, asset management accounts are proud to be able to manage their entire life in a financial account credit needs.
Most of the problems I read about some of the major credit crisis and bank failures that are collateralized debt obligations (CDO's), was caused by a lot of investment banking joint inside. These losses, which almost wiped out the shareholders on a regular basis, in some cases, resulting in the need for dilutive share issue and a huge write-downs were covered with the parent company of participation. The perfect example is the venerable Union Bank of Switzerland, or UBS, most of it has been reported 21000000000 losses over the source of the investment bank Swiss francs (CHF). Another 60 were killed in the institutions and the collapse of equity% above the legendary stock market was forced to issue a mandatory convertible securities dilute existing shareholders.

Buy-side and sell side of investment banking for Buy-side and sell side: investment banks are often divided into two camps. Many investment banks are offering buy-side, we offer the service. the sell side is usually engaged in market-making services, assistance to facilitate the transaction or the customer gets a new bond issue, refers to the sale of newly issued shares of the IPO. In contrast to the buy-side and are trading in order to maximize returns when investing in stocks and bonds or other securities, pension funds, mutual funds, hedge funds were investing public.
Front office, middle office, bank office Many investment banks, for the front office that has been divided into three categories, dealing with office services and a half.
Front-office investment banking • Service: front office services are typically routine work such as finance, mergers and acquisitions to issue billions of dollars of commercial paper for professional management of investments for the company financial companies ( high net worth individuals and institutional support is comprised of investment banking, merchant banking (private equity flashy just to put money into companies that are not traded in exchange for public ownership of banks is a word) for the use of customer group highly selective for internal use or for the analyst report written by an investment research and capital markets, including parameters such as asset allocation and risk limitation strategies.
service investment bank • Central office: insurance companies investment banking middle office, banks, which, like the financial sector includes compliance with government regulations and restrictions for customers and professionals to consider the functions back-office from time to time it is. It also includes capital flows. These are people who are watching the company come out with a good price, in order to determine the amount of liquidity that must be kept on hand to avoid problems of finance. Team of the flow of capital, information, buy / can be used to restrict trade by reducing the use of force to other business areas.
Back-office investment banking •: contains nuts Bakkuofisusabisunatto and investment banking. Securities, it is true that the sale of the collateral for the payment of fixed amounts, such as trade confirmation processing, commercial operators, the software can do their work, the technology platform, advanced features, new trading algorithms are created, and more. Back office jobs, outsourcing is considered modest and some investment banks and companies specialized care often. However, anyone can perform. Without them, nothing else is possible