18 September 2017
Karan Patel
18 September 2017
Perry, Brian. “Financial Careers: Finance Employers.” Investopedia, 17 Aug. 2016,
www.investopedia.com/university/financial-careers/financial-careers2.asp.
Research Assessment #3
After learning about financial advisors and the type of investment companies, I discovered several new fields of finance including commercial bankers, money management firms, hedge funds, real estate firms, equity firms, and real money financers. Reading about this article, Financial Employers, I received a glimpse of the several types of employers who are seeking employees within their types of firms and strengthened my vision of finance.
To begin, investment bankers and commercial banks are two similar types of firms that make loans, give advice to corporations, and finance for other companies, governments, and several other institutions. The one distinguishing characteristic is that commercial banks are normally the bigger portion of banks. I think that commercial banks should be the biggest because they make loans and giving out several loans explains the wealth in those firms. I think I want to start off as an investment bank because I would be within a secure building surrounded by other bankers which is a great place to begin. A connection I made to investment banking was the buying and selling of stocks, bonds, and securities. At a young age, I began to start learning about stock and bought my first stock at twelve. After reading a book, Once Upon a Wall Street, I learned more and more about stocks and to this day, I still invest in stocks. This ties back to why I would think investment banking would be a wonderful start to my career. However, I still have much to learn and I want to encounter all the information and views of finance before I start making decisions.
Next are the Money management, Hedge funds, and private equity firms. The reason I placed these together is because I encountered a similarity between all three. Money management firms typically manage assets for individuals or institutions. Hedge fund firms give out loans and manage money and assets for bigger companies. Private equity firms are the ones who normally buy out the whole company and make an attempt to flip the revenue all to sell it out again. I connected with these type of firms because they are similar to a television show I watch where they buy hotels and flip the properties for a profit. The similarities were the use of risk-taking involved with these firms. All these firms give out money and manage people’s money to claim higher profit. Also, each of these firms contain portfolio management and security analyst as their jobs in the field. I want to read more about those two jobs because I only read a glimpse of what it is.
Real estate firms are another connection to that television show. These people buy out properties and manage them better to increase a return higher than what they paid for it. A job within that field are the deal manager who reveal the houses to potential buyers and convince buyers to pay the higher price they can convince them of. The house that my family bought was sold to us by a woman named Sacina who I have never even heard about. I did not realize her talent until I witnessed her in a newspaper where it labeled out her outstanding efforts in selling over $100,000,000 worth of home and how popular she is in North Texas. My mother still stays in contact with her and I have talked to her about how she reached her goals of being a real estate deal manager. Real money firms are a type of financial company I have never heard of before. I encountered several different words I have never heard before such as pension funds, sovereign wealth funds, and the meaning of “Real Money.” These type of firms invest money into those pension funds and sovereign wealth funds, which I want to learn more about
Annotations
By Brian Perry While there are many different types of entities that higher finance employees, this tutorial will primarily focus upon some of the most common types of institutions where finance jobs can be found. In this chapter, we will look at a broad outline of common finance firms; later, we will examine some of these in more detail as we discuss specific roles in the finance industry.
Investment Banks
Investment banks usually specialize in giving strategic advice to corporations, providing financing to companies, governments, and other large institutions, and in buying and selling stocks, bonds, and other securities[Office1] . Common jobs found at investment banks include investment bankers, security salespeople and traders.
Commercial Banks
Commercial banks usually specialize in taking deposits from individuals and making loans to corporations, individuals, and governments.[Office2] Many large commercial banks also engage in traditional investment banking endeavors such as capital raising and trading. Common roles at a commercial bank include loan officer or bank teller, as well as investment bankers, security salespeople, and traders. Note: the lines between investment banks and commercial banks have blurred over the years and there are very few "pure" investment banks or commercial banks. In practice, most firms considered "investment banks" are either commercial banks from a regulatory standpoint or operate as a division of a large commercial bank.[Office3]
Money Management Firms
Money management firms usually specialize in managing investments for individuals or institutions[Office4] . Very large firms might manage a wide variety of asset classes while smaller boutique firms might focus on a particular market niche, such as small-cap stocks or high-yield bonds. Common roles at a money management firm include portfolio manager or security analyst.
Hedge Funds
Hedge funds are similar to money management firms in that they also manage money for institutions and wealthy individuals[Office5] . However, they are often known for taking more risk than some "traditional" money management firms and are generally more focused upon providing very high returns. Hedge funds sometimes have a broader mandate than traditional money management firms and have fewer restrictions on how they can invest. Common roles at hedge funds include portfolio manager or security analyst.
Private Equity Firms
Private equity firms usually manage money for institutions and wealthy individuals. While hedge funds and money management firms usually buy and sell public securities, private equity firms usually purchase entire corporations[Office6] . When a private equity firm purchases a public company, it "takes it private," which gives the industry its name. Private equity firms usually attempt to profit either by improving the operations of the companies they purchase or by using financial engineering to increase the return on owners' equity. Eventually the private equity firm seeks to either resell the companies they own or take them public again in order to make a profit for themselves and their investors. Most employees at private equity firms are investment bankers, and their functions can include analyzing potential purchases, negotiating deals, raising financing, or attempting to improve portfolio companies' operations and profitability. (To learn more, see What Is Private Equity?)
Real Estate Firms
Real estate firms attempt to either develop new real estate projects or purchase existing projects in an effort to better manage them and increase the returns[Office7] . Common finance jobs at a real estate firm include financing specialist, analyst or deal manager. Note: many leading private equity firms also invest in real estate.
"Real Money"
Real money institutional investors invest money for an entity such as a pension fund, sovereign wealth fund, or insurance company in an effort to generate returns over time that will allow the organization to meet its financial goals. Common roles at "real money" firms include investment analyst, portfolio manager [Office8] or trader.
Summary
In subsequent chapters this tutorial will examine common finance jobs and what they entail. By combining the type of job you want with the type of organization you want to work for, you will be well on your way to the finance career you are looking for.
[Office1]How does the financing to governments work? Is this a good place to begin in the financial field?
[Office2]This is one of the goals. To have enough money to begin my own commercial entity to where I can give out loans
[Office3]Commercial banks are bigger in power
[Office4]Financial advisor
[Office5]Hedge funds are a larger amount of money and give out loans too
[Office6]Like the television show where they flip companies. Equity banker is similar to this
[Office7]Spoke to a Real Estate agent, Sacina, who has sold over 100,000,000 dollar worth of house
[Office8]Mentioned several times
