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FINANCE CLUB Overview of a financial transaction from start to finish Discuss how companies interact with investment banks and investors How do investment banks work interdepartmentally
The Players Corporate Finance Investment Banking Capital Markets – Syndicate Research Sales & Trading Asset Management Private Wealth Management
Corporate Finance CFO and management team –Forecast revenues/expenses - budgeting –Invest in projects to maximize shareholder value Treasury group –Cash management –Invest excess cash Controller –Internal auditing
Investment Banks Raise capital for clients –Cost effective distribution Financial advisory services –Mergers & acquisitions –Divestitures Merchant banking
Private Relationship Coca-ColaInvestment Bank
Investment Bankers Perform industry analysis Create quantitative models to determine return on investment for all stakeholders Perform sensitivity analyses based on different scenarios Offer the client different options Present Capital Markets - Syndicate with proposal(s)
Capital Markets - Syndicate “Know” their respective markets –Loan –Debt –Equity Work with bankers to determine whether deals are viable to bring to market Specialists in marketing deals to investors –Road shows Experts in pricing new issues to the public
Relationship Coca-Cola Capital Markets Syndicate Investment Banking Team
Research Analyst Also known as a Sell-Side analyst Assists in marketing new issues with Syndicate desk(s) Generates investment ideas for investors Conducts fundamental analysis of companies within a sector Identifies factors and trends that drive a company’s or industry’s future growth Comments on valuation of securities
Road Show Coca-Cola Capital Markets Syndicate Investment Banking Team Research Analyst
Asset Management Known as the Buy-Side Represents the group of institutional portfolio managers who selectively invest cash on behalf of investors –Mutual funds –Pension funds –Insurance companies –Hedge funds
Road Show Coca-Cola Capital Markets Syndicate Investment Banking Team Research Analyst Asset Management
Sales & Trading Represents the public or secondary market where investors can trade securities Sales communicates directly with the buy- side community Traders or market-makers ensure an orderly flow of securities by buying and selling from market participants
Sales Manages the relationship with top clients Markets the firm’s new issues with analysts Communicates what the traders on the desk would like to buy and sell Provides daily insight into: –Company earnings –New research reports –Important news and events
New issues and secondary trades Coca-Cola Capital Markets Syndicate Investment Banking Team Research Analyst Asset Management Sales
Traders Risk manager for the firm Provides liquidity to the firm’s top clients Communicates to the sales force what he/she wants to buy/sell and at what price Attempts to match orders to generate riskless income Risks capital on a selective basis for directional bets
Secondary Trading Coca-Cola Capital Markets Syndicate Investment Banking Team Research Analyst Asset Management Sales & Trading
Private Wealth Management Develop and manage relationships with wealthy investors Markets the investment services of the firm Advises clients on investment opportunities Analyze client portfolios
Secondary Trading Coca-Cola Capital Markets Syndicate Investment Banking Team Research Analyst Asset Management Sales & Trading Private Wealth Management
CONFUSED? Finance is a wide field offering many different and exciting opportunities Learn more about the functional areas Pursue your interests Ask questions Second-years are your best resources
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