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The Most Crucial Investment Banking Terms To Know For Any Investment Banker

Investment Banking is a special segment in the banking sector that helps individuals or organizations to grow their capital and get suitable advice from industry experts. These experts act as a mediator between the investors and the security issuers. Investment Banking is booming and evolving globally, but at the same time, it also needs hard work and dedication. Enrolling in Investment Banking courses from any recognized institute will help you understand the crucial Investment Banking Terms which is used for handling clients and their day-to-day requirements.

Investment Banking Terms

Importance of Investment Banking Courses to understand basic Investment Banking Terms to sustain in the Industry:

Industry Knowledge: Doing this Investment banking course, helps students have detailed industry knowledge and a proper understanding of the financial industry including its functions, regulations, and market dynamics. This course is essential for anyone planning to make a career in the Investment Banking industry.

Technical Skills: Developing technical skills such as financial modeling, valuation techniques, and data analysis. Knowledge of technical skills will help an investment banker in completing a task like mergers and acquisition analysis, capital raising, and financial advisory.

Network Opportunities: Having guidance, getting an insight into the industry, and mentorship for getting a job opportunity through networking with professionals are essential approaches towards career enhancement for any individual. Through attending these courses you can get an idea about how to excel in this category.

Resume Enhancement: Getting enrolled in any investment banking recognized course and completing it successfully will help you enhance your resume to find a better job opportunity. It shows your professional commitment and proactive approach to acquiring the required skills crucial for Investment Banking.

Interview Preparation: The curriculum of most of the courses on investment banking will help you prepare for the interview. Mock interviews are part of their syllabus. It will also help you to understand the type of questions asked in the interview. This is especially of great help to the new ones in the industry.

Practical Experience: Some courses provide internship opportunities to their students that can help them have real-time experience with hands-on projects or case studies that will give a detailed knowledge of the course.

Global Perspective: Investment Banking has a presence in the global market and some courses often covers the international financial market, cross-border transactions and regulation followed in different countries.

Certifications: You get these certificates after the completion of the course are recognized by employers and may enhance your credibility in the job market.

Career Transition: Professionals who are looking for a transition in their career to investment banking from another industry needs to have themselves enrolled in specific courses that can provide them with the required necessary skill, making the transition seamless.

Understand Specialized Areas: Investment Banking courses help you understand and explore different aspects of the industry allowing them to pursue the course as per their interest. Investment banking courses help you specialize in mergers & acquisitions, corporate finance and capital markets.

Below is the List of a Few Key Investment Banking Terms:

Private Equity: In simple words, Private Equity is the investment of equity capital in private companies. In a private equity deal, an investor buys some stakes in a private company. The private equity is of 4 types, such as:

  • Venture
  • Growth
  • Buyouts
  • Mezzanine

Syndicate: Syndicate means a group of investment banks or financial institutions that work together to underwrite new security offerings.

Private Investment In Public Equity (PIPE): A process of investment in which a Public company/ companies sell their shares to raise their capital to private investors.

Boutique Investment Banks: Industries or services rather than offering a broad range of financial service, offers smaller and specialized investment banking services to the clients.

Leveraged Buyout: The borrowed money that is collected after the acquisition of a company is used as an asset as the collateral for the loans.

Hedge Fund: An investment fund that pools capital from individuals or institutional investors and invests in various assets.

Valuation: Different methods such as discounted cash flow (DCF) analysis and Comparable Company analysis (CCA) are used for valuation. It is a process of determining the economic value of a company asset.

Debt Capital Markets (DCM): The division of investment banks that deals in debt transactions and bond issuance.

Equity Capital Markets (ECM): This is a division of investment banking that deals with equity transactions including IPOs and equity placements.

Capital Markets: Investment banks play a key role in facilitating transactions where stocks and bonds are bought and sold.

Due Diligence: It is a thorough or overall investigation and analysis of a company’s financial statement, operations and business model.

PitchBook: It contains information that describes a company’s business. It contains current and past financial data, projections, and assets.

Underwriting: It is one of the important functions and a process in the financial world where an individual or institution takes the risk for a fee. The risk typically involves loans, investments, and insurance.

Mergers & Acquisitions (M&A): It is a process of combining two companies bringing together through merging and acquiring financial transactions and tenders.

Initial Public Offering (IPO): Through the Initial Public Offering (IPO) process company’s stock becomes available for the public to purchase on the stock market.

Bonds: It is a promise made by a borrower to the lender to repay the principal amount with the decided interest rate percentage on the promised date. Bonds are issued by governments and municipalities.

Equity: It is capital invested or owned by the owner of a company. On the balance sheet of a company, the difference between asset and liability is called Equity. How much worth an equity is depends on the share prices of the stock of the company.

Analyst: A professional who joins an organization after graduation as an entry-level job and plays an important role in evaluating finances and suggests clients about their financial decisions based on their research.

Bull Market: It is a financial market that sees positive growth and rise in price and positive sentiments among the investors.

Bear Markets: It is a financial market that sees the lows in prices with a pessimistic outlook.

Diversification: It is a process where capital is invested in different assets to minimize the possibility of loss.

Liquidity: It refers to the asset that can be converted easily into ready cash without affecting its market price. The two types of liquidity are:

  • Market Liquidity
  • Accounting Liquidity

Return On Investment (ROI): It is a process to evaluate how well an investment has performed. It is calculated in percentage by dividing net profit or loss.

Net Asset Value (NAV): Net Asset Value is the market value of the scheme divided by the total number of units of the scheme.

Recommend Read,

Below are the few institutes known for delivering the best courses for investment banking where students also get to learn everything about investment banking terms thoroughly:

  1. IIM SKILLS-

IIM SKILLS is a well-known online institute that offers various courses including  Investment Banking Course. You can visit the official site of IIM SKILLS for any information about their courses. As investment banking jobs are on the rise, their courses are designed as per market demands, and in this course students are taught every detail of Investment Banking and when and how to use them in day-to-day life when working as an Investment Banker in any organization.

What will you get in the Investment Banking Course at IIM SKILLS:

  • Online Investment Banking course for three months.
  • 70+ Hours of lectures including training and doubt-solving sessions
  • Practical Assignments and Case Studies for real-time experience
  • Guaranteed Internship for 1 month with 100% job support.
  • Get assistance with LinkedIn profile building.
  • Recognized Investment Banking Certification.
Module 1MS PowerPointModule 5Technicals of Investment Banking
Module 2MS ExcelModule 6Different Marketing Collaterals
Module 3Financial System and MarketModule 7Technicals of Financial Modeling
Module 4Derivatives MarketModule 8Business Valuation

The Following Modules Covered Here Are:

 MS PowerPoint:

  • Introduction and understanding of MS PowerPoint.
  • Keyboard shortcuts and their importance
  • Creating, managing, and designing the slides
  • Adding transitions and animations
  • Creating the slide master
  • Inserting pictures, and links and editing them
  • Working on illustrations and shapes
  • Building different kinds of graphs and charts

 MS Excel:

  • Introduction to MS Excel and Ribbon
  • Uses of many different functions
  • Rules of conditional formatting
  • Font and Number Formatting
  • Data validation, sorting and filters using Excel functions as well as formulas
  • Table functions and dynamic arrays
  • Data presentation.
  • Introduction to Macros

Fundamentals of Financial System and Market:

  • Basics of the financial system
  • Money market
  • Market participants and Regulators
  • Stock Exchange and Financial Centres
  • Meaning of depository receipts
  • Characteristics, Securitisation, and types of bond
  • Yield to maturity
  • Forex and its features
  • Quotes and Trades

Derivatives Market:

  • Introduction to Derivatives Forwards, Futures
  • Discussion of Call and Put options
  • Different Pricing in the Derivative Market
  • Understanding the concept of Swaps and their types
  • Meaning of Hedging and Speculation
  • Overview of Credit default swaps

Technicals of Investment Banking:

  • Overview of Investment Banking
  • Role of Investment banker
  • Vertical and Horizontal Mergers
  • A sell-side deal lifecycle
  • Concept of due diligence
  • Overview of Greenshoe Option
  • Understanding of Corporate Restructuring and Turnaround

Different Marketing Collaterals:

  • Buyers list / Investors list
  • Non-Disclosure Agreement (NDA)
  • Pitchbook / Pitch deck
  • Teaser
  • Confidential Information Memorandum (CIM)
  • Financial Models

Technicals of Financial Modelling:

  • Introduction to the financial model
  • Preparation of different schedules, including equity, depreciation, debt, working capital and fixed assets.
  • Addition of cover page

Business Valuation:

  • Difference between GPC and GTM
  • Criteria to screen peers
  • Valuation multiples to be used
  • Ideal time to focus on, including Last Twelve Months (LTM), Next Twelve Months(NTM),
  • historical and projected years.
  • The related concept of NOPAT, changes in working capital, Capex adjustments
  • Concepts of controlling premium
  • NAV approach for valuation
  • Relevance of the approach
  • Presentation of valuation output
  • Concepts of pre-money and post-money valuation.
  • Different ways of calculating Beta

Course Details: 3 months + 1 month Internship

Course Fees: Rs 47000+ GST

Other Professional Courses from IIM SKILLS

Contact No. +91 9580740740

Email: [email protected]

2. Corporate Finance Education (CFI)-

Corporate Finance Education is an online institute that helps its students to have a basic understanding of finance for any successful business growth. Well-designed courses with proper training in Investment Banking are given to the learners who opt for this course. The Corporate Finance Education (CFI)  training programs are designed in such a way that will also help you in gaining all the knowledge about Investment Banking Terms.

Financial Modelling Using MS Excel:

  • Financial Modelling and Valuation Analysis Program
  • Classroom/ Live Online Class/ Self-paced
  • CV Preparation and Mock Interviews
  • 100% placement assistance
  • Weekend and Weekday batches

Financial Modelling Using MS Excel Curriculum Highlights:

  • MS Excel Training- Basic to Advance
  • MS PowerPoint Skills
  • Financial Statement Analysis
  • Business and Financial modelling
  • DCV Valuation
  • Comparable Company Analysis
  • Comparable Transaction Analysis
  • Introduction to Project Finance
  • Company Profile and Pitchbook
  •  Capstone Project
  • Soft skills Training and Resume-building

Certificate in Investment Banking:

  • Financial Modelling And Valuation
  • Merger & Acquisition, Pitchbook, Fund Raising
  • Company Profiles and Industry Analysis
  • Equity Research Report Writing
  • Interview Soft Skills and CV Building
  • Weekend and Weekday Batches

Certificate in Investment Banking Curriculum Highlights:

  • MS Excel Training- Basic to Advance
  • MS PowerPoint Skills
  • Financial Statement Analysis
  • Business and Financial Modelling
  • DCV Valuation
  • Comparable Company Analysis
  • Comparable Transaction Analysis
  • Introduction to Project Finance
  • Company Profile and Pitchbook
  • Industry Analysis, Benchmarking and Charts
  • M&A Merger Modelling
  • Introduction to Credit Analysis
  • Introduction to Stock Market Investments
  • LBO Modelling (Optional)
  • Soft Skills and CV building

The Investment Banking Certificate From CFI Will Help You to Perform Below Role Successfully:

  • Investment Banking Research
  • Equity Analysis Research
  • Financial Advisory
  • Credit Analysis
  • Project Finance Modelling
  • Financial Analysis

Contact Details: +91 93542 66554

3. Indian Institute of Management Indore-

IIM Indore is an autonomous business school that ranks 8th in the country for its world-class training courses designed to give placement opportunities to its students by helping them enhance their skills. Their courses are designed in such a way that you understand the basic Investment Banking Terms of the financial market, which will help you understand your job better as an Investment Banker in any firm.

Highlights Of The Course:

  • Real-life understanding of Investment Banking and commerce.
  • Alumni executive education
  • Campus immersion module

Content Of the Course:

  • Financial Reporting, Analysis and Valuation
  • Financial Management
  • Investment and Portfolio Management
  • Investment Banking- 1 and 2
  • Mergers & Acquisitions
  • Options, Futures and Derivatives
  • Economic Environment
  • Spreadsheet Modelling for Finance
  • Industry lecture

Courses and Training Offered at IIM Indore Are:

  • Accounting Fundamentals
  • Financial Statement Analysis
  • Financial Modelling
  • Corporate Valuation
  • Excel skills
  • Corporate finance
  • Mergers & Acquisition

Eligibility For The Course Completion:

Diploma or Bachelor’s degree or equivalent or 2 years Master’s degree or equivalent from a recognized university with minimum 50% marks of all the years.

Course Duration: 12 Months

Course Fees: INR 4,00,000

4. The Wall Street School-

The Wall Street School is known to be one of the leading Institute for Investment Banking. The syllabus is designed to help its students compete with the market standards with a deep understanding of Investment Banking Terms. It was founded in 2009 to provide world-class courses with the rise in Investment banking demand.

Highlights of the Course are:  

  • Real-time training to help participants get jobs
  • The training is delivered by industry experts
  • Hands-on case studies and projects for training
  • Pay only 40% of the fees on the enrolment and 60% after the successful placement.
  • Batches are available as per individual convenience- weekday and weekend batch

The Modules Covered in This Course Are: 

Module-1 Essential to Intermediate Excel: 

  • Using the mouse in Excel
  • Sorting data to use advanced filters
  • Cell freeze, row freeze and column freeze
  • Using conditional formatting
  • Linkages used for financial modelling
  • Match function
  • CAGR Calculation
  • Transpose function
  • Usage of the IF function
  • Table function
  • Pivot function
  • IRR Calculation
  • Cell referencing
  • Interest function as EMI calculator
  • Sum if, Count if, Sumifs
  • Sum product functions
  • Multiple usage of Vlook functions.

Module-2 Advanced Excel and PowerPoint: The focus is to effectively and efficiently utilise Microsoft Excel for data analysis.

  • Offset function
  • Sensitivity Analysis using different ways
  • Iterative Calculations. How to negate it
  • Using Excel for Statistical Analysis
  • How to summarise data into a single sheet
  • Charting

Module-3 Basic Finance Concepts: 

  • Defining interlinking and relationships between the three financial statements and how the accounting flow
  • Ratio Analysis of Financial Statements
  • 3step and 5step Dupont Analysis

Module-4  Feasibility Study/Business Modelling:

  • Benefits of using Net Present Value (NPV) to calculate the financial viability of a project
  • Building dynamic business models from scratch
  • Using formulas for the after-tax weighted used to determine the cost of capital
  • Calculation of free cash flow to firm and free cash flows to equity and how they are used to determine the profitability of a project

 Module-5

Here you learn how to build a detailed trading comp right from selecting peers to analysing the final output.

The Following Highlights of These Points Are:

  • Impact on convertible securities – options, warrants, RSUs, convertible bonds, convertible preference shares.
  • Possible reasons for why different companies in the same sector are trading at different multiples and how to analyse those differences before jumping to the conclusions that a particular stock is undervalued or overvalued
  • Role of multiples in IPO valuation
  • Running regression analysis on multiple
  • How to select peers in case other listed companies are unavailable in the same space.

 Module-6

Precedent Transaction Analysis is a variant of trading comps. It is one of the techniques investment bankers use. Under this technique, we figured that trading comps are covered:

  • Impact of controlling premium on multiples and what is the basis of the size of controlling premium

Module-7 Discounted Cash Flow Valuation:

  • Projection of free cash
  • How to calculate WACC
  • Different ways of calculating beta

  Module-8 Merger Model: 

  • Impact of stock deal or cash deal of the company
  • How to factor synergies in the pro forma earnings of new companies after the acquisition
  • Everything about the M&A Process
  • Why we need to learn PowerPoint
  • Basics of PowerPoint
  • Learning Letter of Interest
  • Learning Letter of Intent full
  • Learning Merger of Model Basics
  • Merger Model Files
  • M&A Notes

  Module-9 Leveraged Buyout:

  • LBO Model (Valuation)
  • LBO-Transaction assumption
  • LBO-Debt assumptions
  • LBO- Goodwill calculation
  • LBO- Closing Balance Sheet
  • LBO- Income Statement
  • LBO- Balance Sheet
  • LBO- CFS
  • LBO- Key metrics
  • LBO Files

Course Duration:

  • 6 Weeks / 180+ Hours /Mon-Fri/ Rs 45000+GST
  • 2.5 Month weekend/ 120 Hours/ Sat-Sun/ Rs 42000+GST

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FAQs About Investment Banking Terms?

Q. Why is it important to know Investment Banking Terms?

It is important to know different Investment Banking Terms as it will help you as an Investment Banker to understand and help your clients. An investment banker acts as a mediator between clients and organizations, so they should have a proper knowledge of different Investment Banking Terms used in the financial market.

Q. Which is the best Investment Banking Course?

IIM Skills is one of the leading online education institutes providing one of the best courses on Investment banking including many other courses. Their priority is their students and the knowledge they receive from various courses offered at IIM Skills. Investment Banking Terms are an important topic covered under the Investment Banking course and that is why it is designed and explained in a wonderful way to its students.

Q. What are the advantages of knowing Investment Banking Terms?

Investment Banking terms are essential to know as it helps in understanding and solving the complexities of any transaction. The Investment Banking Terms keep changing and evolving with time.

Conclusion On Investment Banking Terms:

Investment Banking is a dynamic industry evolving with time. There are many regulations to be followed where Investment Banking Terms keep changing for the betterment of the financial markets. However, it is important to understand that while Investment Banking courses are beneficial, they are not guaranteed pathways to success. There are many other crucial components for achieving success in the Investment marketing industry.

 

 

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