Finance Club Investment Banking, Sales & Trading, Corporate Finance, Research and

Private Wealth

2008-2009

September 7th Finance Club Meeting Agenda

September 7th

Club Overview Introduction of Officers Key topics by function – questions to be thinking about

– roles and responsibilities

– nature of work

– career paths

– Skills required and life style

– Day in the Life of a Summer Intern

Developing your story and resume; forming study groups Do’s and Don’ts throughout the recruiting process Outline of Available Resources Upcoming Events

Overview

Website– http://sitemaker.umich.edu/ross.finance.club/home– From eCampusGroups, click the website link to register– Newly-Registered Members will be added on Tuesday and Saturday of each

week – Presentations will be uploaded within 24 hours

Investment Banking

2008-2009

The Investment BankC

orpo

rate

Clie

nt

Investment Banking

Coverage Group

IB Product GpDebt

Capital Markets

IB Product GpM&A

IB Product GpEquity

Capital Markets

Material, Non-Public Information “Private Side”

Public Information “Public Side”

Sales & Trading

Private WealthManagement

Inst

itutio

nal &

Ind

ivid

ual C

lient

s

Research

Investment Banking Overview

Investment Banking Division

Advisory Capital Raising

Buy-side advisory Purchase of assets, division or entire

firms Sell-side advisory

Sale of assets, divisions or the entire firm

Managing planned sale of the firm Hostile take-over defense (anti-raid)

Strategic alternatives Acquire, sell, re-capitalize, go public,

go private, etc. Joint venture creation Restructuring Other

3rd party fairness opinions Miscellaneous valuation work

Debt Issuance Investment grade bonds High yield instruments Bank loans Mezzanine debt

Equity Issuance Common stock Preferred stock Equity-linked (convertibles) Hybrid instruments

Other Financing Transactions Hedging interest rate risk Hedging foreign exchange risk Hedging commodity risk

Corporate Clients

The Investment Banking Deal Team

AssociateCentral Force

or “Quarterback”

External DealAccountants

Capital Markets

Coverage Officer(VP or MD)

External Deal Attorneys

Bank Compliance Dept.

Analyst

Managing Directors, 10-20 years experience Vice Presidents, 5+ years experience **Associates**, the central force of the deal team Analysts

Role of the Associate Draft pitch books Draft internal bank

documents Draft marketing

documents Financial valuation and

analysis Manage client interactions

(CEO, CFO and Board) Maintain standard industry

comparables (ie trading and transaction comps)

Track capital markets Perform company due

diligence Perform industry research Mentor analysts

Skills & Traits for Investment Banking

Skills & Abilities Knowledge of financial services Strong quantitative and analytical

skills, especially financial analysis Advanced oral and written

communication skills Solid sales and marketing skills Ability to work independently Team player

Personal Traits High degree of motivation and

energy Keen attention to detail Composure and confidence Assertive and entrepreneurial Ability to learn, think and act

quickly Strong inter-personal skills Strong interest and academic

excellence in accounting, finance and corporate strategy

Investment Banking Recruiting Time-Line

September October November December January

Build your Resume and Story

Networking & Company Presentations

Individual Networking & Informationals

Mock Interviews Fit and Technical

Cover Letters and Final Preparation

Understand the ProcessDevelop Focus

Recruiting takes a lot of work, energy and time. Plan for it.

Chicago, London & Asia Forums

Corp. Fin. Forum

Wall St. Forum

Tod

ay

Corporate Finance

2008-2009

What Is Corporate Finance?

Corporate Finance = Big Picture View (General Management)…

Definition: Any financial or monetary activity that deals with a company and its money.

Corporate Finance Career Opportunities

Financial Services

• Citigroup (FMA)

• JPMorgan Chase (FALP)

• Lehman Brothers

• AMEX

• HSBC

• Washington Mutual

• Liberty Mutual

• National City

• M&T Bank

• Discover Financial Services

High Tech

• Amazon

• Dell

• Microsoft

• Avaya

• Cisco Systems

• Google

• Hewlett-Packard

• Intel Corp.

• Orbitz.com

• Paypal

• Yahoo!

Healthcare

• Eli Lilly & Company

• Johnson & Johnson

• Medtronic

• Bausch & Lomb

• Baxter

• Amgen

Others

• American Airlines

• Delta Airlines

• Kraft Foods

• General Mills

• Chevron Corp.

• Exxon Mobil

• Ford Motor

• GM Treasurer's

• GMAC

• Eaton

• DTE Energy

• PwC

• E & J Gallo

Retail

• Wal-Mart

•Target

• Limited Brands

• Sears

• Best Buy

Corporate Finance Timeline

September

• Differences Between IB, S&T, Corporate Finance

• Overview: Timetable

• Overview: Functions

• Overview: Industries

• Networking Etiquette: How to Dress?

• Networking Etiquette: Thank-You Notes

• Networking Etiquette: Appropriate Questions

• Corporate Finance Forum

• List of Corporate Recruiters

• Off-Campus Searches

• International Opportunities

• Creating Your Story

• Drafting Your Resume

• Resume Review

October

• Wall Street Forum

• Cover Letters

• How to Conduct Company Research?

• Resources Available at University of Michigan

December

• Mock-Interviews (Technical and Fit)

• Overall Polish and Presentation

• Bidding Strategy

• Thoughts for Winter Break

• Informational Interviews

November

• Interview Preparation: Technical Questions

• Interview Preparation: Fit Questions

• Informational Interviews: How to Reach Out to Recruiters?

• Informational Interviews: How to Conduct the Interview?

• Mock-Interviews (Technical and Fit)

Ongoing

• Industry Speaker Series

• Functional Speaker Series

• Market Update

Skills, Career Paths, Life-Style

Skills Needed and Personal Traits Analytical / Problem Solving / Quantitative Leadership / Initiative Ability to see big picture and how the pieces fit Attention to detail Cross – Functional Skills (ie. ability to work across different functions) Multi-tasking Team player & good communicator Comfortable with ambiguity

Career Paths CFO Treasurer Business Unit Management Finance Director/Manager Controller

Lifestyle The place to see and drive the big picture Good work/life balance High job security (relative to other Finance positions) Easily try different roles while building an array of transferable skills Less pay (especially bonus) than other Finance positions

Corporate Finance Forum – September 19th

One Stop Shopping for Corporate Finance Across Industries: Financial Services, CPG, Retail, Defense…

Various Corporate Finance Topics: M&A, Capital Investment, Firm Financing Options, Corp Fin programs…

Tremendous learning/networking experience – everyone should attend! (IB, S&T, Corp. Fin., Research, PWM)

8:30 A.M. - 5:30 P.M. - September 19, 2008Michigan Union

Sales and Trading

2008-2009

Sales & Trading Overview

What is sales and trading? Salespeople work with customers on what is called “the buy-side”,

selling them large amounts of securities like stocks, bonds or currencies Traders watch the market and trade orders for customers. The trader

rarely talks directly to the customer The buy-side refers to the investment management firms, pension

funds, hedge funds and trusts that buy stocks, bonds and other securities from the “sell side”

The sell-side refers to Wall Street investment banks that sell stocks, bonds and other securities to the buy-side

Individuals working in a sales & trading department of an investment bank are not investment bankers, nor do they work in investment banking. Instead, they are either sales brokers or

traders who work in sales & trading.

Skills and Traits for Sales & Trading

Skills & Abilities Knowledge of financial services Strong quantitative and analytical

skills, especially financial analysis Advanced oral and written

communication skills Solid sales and marketing skills Ability to work independently Team player

Personal Traits High degree of motivation and

energy Composure and confidence Ability to think and act quickly Strong inter-personal skills Strong interest and academic

excellence in accounting, finance and corporate strategy

How is sales and trading different from investment banking? Lifestyle, first-in-and-first out in the investment bank, never work on

weekends Work, pitch book, detailed financial modeling vs. entertain clients, work

on trades

Sales & Trading Overview

Recruiting for Sales & Trading Mostly Self-Directed If you are interested in pursuing Sales & Trading opportunities please

contact: Damien McGough, VP of Sales & Trading

– damienmc@umich.edu

Research & Investment Management

2008-2009

Research Overview

Buy Side (Asset Management) Manage Clients Money Clients: Individual Investors, Pension Funds,

Endowments, etc. Example: Fidelity, Vanguard, Mutual Funds, Hedge

Funds Investment Horizon: Months, Years Recruitment: Difficult, Competitive

Sell Side (Equity Research) Provide Liquidity & other services to Buy Side Example: Citigroup, Lehman, Deutsche, Etc Investment Horizon: Days, Weeks Recruitment: “Relatively” Easy, Larger Firms Possible stepping stone position

Lifestyle Time - Not as long as

IB, but longer than CF Weekends depends on

firm Travel depends on the

team– Could be extensive– Could be limited to

industry presentations

Work independently for long stretches

Once your in – your in Numerous transferable

skills Potential for large

bonuses Great benefits

Skills & Traits for Research

Skills & Abilities Strong communication skills Less quantitative than you might

think Strong analysis and critical

reasoning ability Ability to work independently

Personal Traits Passion for the markets and

investing Resilience – “Thick Skinned” Disciplined Big picture thinking Intellectual Curiosity High degree of motivation and

energy

Career Possibilities

Post MBA Associate Analyst

Hedge Fund

Career Analyst

Portfolio Manager

Private Wealth Management

2008-2009

What is Private Wealth Management

Usually is part of the Asset Management area of the banks/brokers.

In broad lines is to develop investment strategies for High Net Worth Individuals.

Business model varies for each firm.

It’s a “people” business.

Even when markets are not good clients need people to take care of their money!

Private Wealth Management (PWM) Overview

Private Wealth Management (PWM) Overview

Interpersonal AnalyticalMarkets

Knwoledge

Skills

Recruting

Somewhat self-directed, last year only GS and JPMorgan came on campus.

Recruiting process Similar to IB.

Very important to visit firms for Info sessions in NY and Chicago.

Use the Alumni network.

Private Wealth Management (PWM) Overview

Private Wealth Management (PWM) Overview

5. You consider yourself a “people” person

Top 5 Reasons to Summer in PWM:

4. You watch the financial markets (or at least you’ve heard of them)

3. You love a challenge – you won’t take “no” for an answer

2. You have an entrepreneurial spirit; you want to run your own company

1. Because you want to have a life outside of the office

Your Story, Resume, and Study Group

2008-2009

Developing Your Story

Your story should smoothly answer three questions: Where did you come from (your background) What are you doing now Where are you going (your future)

Practice until your story becomes second nature Get feedback on your story from peers, second years and friends

Your “story” is often the first impression you make with a recruiter. It critical to think and practice a great deal on what

you want to communicate during that moment.

Introduction Version Use when a brief introduction is

appropriate 10-15 seconds “Hello, I’m <Name> from…”

Two-Minute Drill When a more detailed introduction

is necessary One to two minutes Same as short version, but with

greater detail

Developing Your Resume

Use Michigan format and resources Student Career Services>Develop Resume

Action >Context > Result (ACR) Explain what you did, the work situation surrounding your

responsibilities, and the results you achieved (quantified)

Quantify result Size of transaction, sales generated, direct reports etc.

Comprehensive flow of your history No breaks or gaps

Introduce and explain private or non-US companies that recruiters may find unfamiliar

You are intimately familiar with your work history, but a recruiter is not. Can a recruiter easily understand your work

history in just a minute or two?

Forming a Study Group

Finance recruiting involves an incredible amount of work; even the most talented student has difficulty managing the process

Study groups consist of a manageable (three to six) number of peers that are recruiting for the same function

Study groups communicate or meet regularly to: Share information about events and networking opportunities Test and improve each others industry knowledge

– Weekly market reviews, deals in the news etc.

Improve each others recruiting skills (stories, resumes and interviewing) Help each other network during recruiting events Provide moral support during stressful periods

A study group of peers recruiting together for a similar function can be immensely valuable.

Recruiting Do’s and Don’ts

2008-2009

Recruiting Do’s and Don’ts

Do… Maintain a clean appearance at all times, including:

– Showering, Shaving, Trimming Nails and Hair– Wearing Deodorant– Wearing properly pressed, matching, and conservative clothes– Err on the side of Business Formal

Ask intelligent, thoughtful questions. Respect the time of Recruiters Write a simple, 1-2 line Thank You note Ask for a Business Card

REMEMBER: YOU ARE BEING JUDGED AT ALL TIMES!!!

Recruiting Do’s and Don’ts

Do NOT… E-mail or Contact Alumni at this point in the Recruiting Process

– You will do more irreparable harm than good– Rely on your MBA 2 and Career Counseling classmates for assistance

Ask Sub-Standard questions to Recruiters. These include:– Brain Teasers and extremely complicated questions involving calculations– Information that is available on the company’s website. Do your research!– Negative questions about the company or industry

Crowd out colleagues – You will have many opportunities to interact with Recruiters– They will look down upon this action

Attach Resumes to Thank You notes or Request follow-up meetings Give out your Business Card

REMEMBER: YOU ARE REPRESENTING RSB!!!

The Circles of Trust

Michigan Alumni

Everyone Else

MBA2s

MBA2s

Career Counselors

Career Counselors

Michigan Alumni

Your Peers and Study

Group

Everyone Else

Find information you trust as close to the center of the circles as possible

Outline of Available Resources

2008-2009

Outline of Available Resources

Finance Club Webpage, weekly meetings and workshops Resume reviews, mock-interviews and meet the interns Forums (Corporate Finance, Wall Street, London & Asia)

Student Career Services Website >Job Database >Conduct Self-Assessment

– Vault & Wet-Feet Guide– **Investigate Careers** (includes job descriptions and sample course paths)

>Develop Resume– Resume Manual, Resume Guide w/ Examples– Cover Letter Guide w/ Examples

OCD Counselors – they are Finance Club members too! Student Career Serves Website > Career Counseling General counseling, resume reviews and mock-interviews Come prepared!

Outline of Available Resources (cont’d)

Kresge Library Resources Ross School of Business Homepage>Kresge Library>A to Z Databases

– Standard & Poors NetVantage (industry and company overviews)– Factiva (in-depth news)– Vault.com (insider information and guides)– Wetfeet.com (insider information and guides)

Resume Books– Resume books from prior years are available on two hour reserve– Find resumes for people with similar backgrounds– Read resumes for people that went into your desired function– Apply lessons to your own resume

Periodicals– Daily and weekly subscriptions to relevant newspapers and magazines

– Wall Street Journal– New York Times– Economist– Business Week

– Free (no need to have your own subscription!)

Upcoming Events

2008-2009

Upcoming Recruiting Events

September 8th

Deloitte & Touche Office Hours – Investment Banking, Corporate Finance– 10:00 a.m. – 2:00 p.m.

– MBA2

– Executive Residence North – 1st set of Tables

– Business Casual

Upcoming Recruiting Events

September 9th

Piper Jaffray Presentation – Investment Banking– 5:00 p.m.

– MBA1 & MBA2

– Room E1530

– Formal Attire

FTI Consulting Presentation – Specializes in Restructuring, M&A advisory– 7:00 – 8:30 p.m.

– MBA1 & MBA2

– Room E0530

– Formal Attire

FMC Biopolymer Presentation – Corporate Finance– 5:30 – 7:30 p.m.

– MBA1 & MBA2

– Pizza House

– Business Casual Attire

Upcoming Recruiting Events

September 10th Citi Global Transaction Services – Corporate Finance

– 11:30 – 1:30 – Information Session in Student Lounge

– 7:30 – 9:30 p.m. – Happy Hour @ Arbor Brewing Company

– MBA1 & MBA2

– Business Casual Attire

Upcoming Recruiting Events

September 11th Citi Global Transaction Services Office Hours – Corporate Finance

– 9:00 a.m. – 4:00 p.m.

– Executive Residence South – 2nd set of Tables

– MBA2

– Business Casual Attire

GM New York Treasury – Corporate Finance– 11:00 a.m. – 1:00 p.m. – Office Hours – W2736

– 7:00 – 8:30 p.m. – Presentation – E0530

– MBA2

– Business Casual Attire

Citi Consumer and Corporate Presentation – Corporate Finance– 5:00 – 6:30 p.m.

– E0540

– MBA1 & MBA2

– Business Casual Attire

Upcoming Recruiting Events

September 12th Meet the Companies Event

– MBA 2’s and Evening MBA’s in Final Year

– Michigan League Ballroom

– See Event Calendar for Companies Represented

– Includes Companies recruiting for Various Finance Positions

– Ameriprise Financial

– Chicago Trading Company

– Citi

– Centennial Group

– Discover Financial

– Duff & Phelps

– FDIC

– Morningstar

– M&T Bank

– Many Others….

Next Finance Club Meeting

September 14th

MBA1 - IB/S&T/Corp Fin/PWM - Q&A panel or event with MBA2s 6:00 p.m. – 7:30 p.m. – Room E0540