In this tutorial, you’ll learn how to prepare for “fit” questions in investment banking interviews efficiently and how to use the “Rule of 3” to develop short anecdotes and responses that you can re-use to answer the most common questions.
"Financial Modeling Training And Career Resources For Aspiring Investment Bankers"
Table of Contents:
3:57 Your 3 “Short Stories”
6:22 Your 3 Strengths and 3 Weaknesses
8:36 Your Top 3 Real Weaknesses
12:59 Recap and Summary
The WORST way to approach “fit” questions is to memorize dozens or hundreds of questions and answers.
Instead, you should develop a few stories that you can use and re-use for the most common qualitative questions.
Your 3 “Short Stories” should include a Success Story, a Failure Story, and a Leadership Story that demonstrate the qualities bankers are looking for: Analytical skills, ability to work in a team, ability to work long hours, attention to detail, communication skills, and a demonstrated interest in finance.
For example, you could discuss an internship where you made several corporate finance processes more efficient, a Treasury internship where you worked with other departments to help the company avoid breaching a Debt covenant, and a math tutoring business you started but ultimately had to shut down.
Your 3 Strengths should be easy because you already know the qualities bankers are seeking.
Your 3 Weaknesses are tougher because they must be real, but not too real, they can’t be overly personal, and they must be things you could conceivably fix (e.g., don’t say you’re “too short”).
You could say that you take too long to make decisions or second-guess yourself, that you’re not always good about speaking up, or that you don’t always follow up on tasks and assignments.
For your 3 “Real Weaknesses,” compare yourself to the *ideal* candidate for IB roles (Ivy League school, perfect grades and test scores, accounting/finance major, multiple languages, multiple finance internships, sports, study abroad, and international recognition in some area), and assess how you’re different.
Maybe you went to a non-target school or you have low grades; maybe you don’t have much finance experience or you became interested in banking too late; or maybe you haven’t taken any accounting or finance classes.
Find your top 3 weaknesses and develop ways to address them.
For example, you could say that your family couldn’t afford an Ivy League school or that you attended your university because of a generous scholarship.
Or you could explain that you’ve been moving in the direction of finance ever since you became interested in it, despite a late start that precluded you from winning internships.
Or you could point to self-study, the CFA, or other courses to explain your accounting/finance skills and how you’ve learned the requirements independently.
No, but we do have articles on interview prep for S&T and ER on M&I if you take a look there. The "fit" questions aren't that much different, but you focus on slightly different points in your answers (e.g., ability to take calculated risks is a lot more important in S&T).
What advice could you give to someone who maybe didn’t go to an Ivy League school, but a known senior military college such as The Citadel?
I’ve been interested in investment banking and received an amazing opportunity but want to be sure I can meet this criteria.
You can address the most obvious one in your story, but don't spend too much time on it; your story is about your strengths, not your weaknesses. So, don't mention something like a low GPA or low test scores upfront. Let the interviewer ask about it, and be prepared to address it when he/she does. On the other hand, if your weakness is blatantly obvious, such as getting interested in IB after graduation and not having any relevant internships, you have to explain that in the course of your story.
Although foreigners may now invest in A-shares, there is a monthly 20 percent limit on repatriation of funds to foreign countries.
Performance of A-shares.
Since its inception in 1990, including a major reform in 2002, the index has seen great fluctuations. Overall, however, it has grown along with the Chinese economy. The years 2015 to 2016 were a particularly difficult period, with a 52-week performance of -21.55 percent as of July 20, 2016.
As China grows from an emerging market to an advanced economy, there is substantial demand for Chinese equity. Stock exchange regulators continue efforts to make A-shares more broadly available to foreign investors and have them recognized by the global investing community.
In June 2017, the MSCI Emerging Markets Index announced a long-awaited decision it would add stocks to its index. According to CNBC, MSCI will add 222 China A Large Cap stocks to its benchmark emerging markets index gradually beginning in 2018. The MSCI website reveals the stocks it will list include the Bank of China, China Merchants Bank, Guotai Junan, Ping An Insurance, according to a document on Tsingtao Brewery, SAIC Motor, Suning Commerce and Spring Airlines.
Current Dividend Preference.
Participating Preferred Stock.
Convertible Preferred Stock.
Cumulative preferred stock includes a provision that requires the company to pay preferred shareholders all dividends, including those that were omitted in the past, before the common shareholders are able to receive their dividend payments.
Non-cumulative preferred stock does not issue any omitted or unpaid dividends. If the company chooses not to pay dividends in any given year, the shareholders of the non-cumulative preferred stock have no right or power to claim such forgone dividends at any time in the future.
Participating preferred stock provides its shareholders with the right to be paid dividends in an amount equal to the generally specified rate of preferred dividends, plus an additional dividend based on a predetermined condition. This additional dividend is typically designed to be paid out only if the amount of dividends received by common shareholders is greater than a predetermined per-share amount. If the company is liquidated, participating preferred shareholders may also have the right to be paid back the purchasing price of the stock as well as a pro-rata share of remaining proceeds received by common shareholders.
Significance to Investors.