Do Investment Bankers make a lot of money compared to traders | Forex Factory

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Do Investment Bankers make a lot of money compared to traders

  • #1
  • First Post: Aug 2, 2010 4:43am Aug 2, 2010 4:43am
I was reading about Chelsea Clintons marriage to this Stanford educated investment banker Mezvinsky. When I read he bought a posh NYC 10th floor appartment for a whopping $4000000/-

http://allthingshillaryclinton.blogs...ying-knot.html

I was like wow and when i further read he's just 32 years old I was thinking to myself whatever profession he's in sure seems fantastic if he can cough up 4 mil just out of college.

I was wondering if anyone in here knows if investment bankers really do make this much money or if this guys an exception (maybe because he went to Stanford)
  • #2
  • Aug 2, 2010 5:09am Aug 2, 2010 5:09am
Quoting fugly
I was reading about Chelsea Clintons marriage to this Stanford educated investment banker Mezvinsky. When I read he bought a posh NYC 10th floor appartment for a whopping $4000000/-

http://allthingshillaryclinton.blogs...ying-knot.html

I was like wow and when i further read he's just 32 years old I was thinking to myself whatever profession he's in sure seems fantastic if he can cough up 4 mil just out of college.

I was wondering if anyone in here knows if investment bankers really do make this much money...
Here in the UK, IBs actively recruit from the top few universities. I think I would be safe to say that, for those who want money, Investment banking is where you want to be. The people who get in to these positions have perfect academic records, as well as other things. Obviously $4 million will not be the standard, but IB is where you want to be if making a lot of money is important to you.

PS. I'd say (guess) that they make much more money than traders (on average).
Living the adventure in my head.
  • #3
  • Aug 2, 2010 5:21am Aug 2, 2010 5:21am
Are you aware that his dad is a former congressman? Are you sure he paid the bill, not his dad? Are you sure he is in his current job because he's the new Livermore or because his dad helped him a little?

It's a funny old world, 30 year olds don't buy 4 mil apartments, usually.

Quoting fugly
I was reading about Chelsea Clintons marriage to this Stanford educated investment banker Mezvinsky. When I read he bought a posh NYC 10th floor appartment for a whopping $4000000/-

http://allthingshillaryclinton.blogs...ying-knot.html

I was like wow and when i further read he's just 32 years old I was thinking to myself whatever profession he's in sure seems fantastic if he can cough up 4 mil just out of college.

I was wondering if anyone in here knows if investment bankers really do make this much money or...
forget about tomorrow, just steal away into the night
  • #4
  • Aug 2, 2010 11:10am Aug 2, 2010 11:10am
I wonder where female Investment Bankers hang out... hmmm.
Living the adventure in my head.
  • #5
  • Aug 2, 2010 11:42am Aug 2, 2010 11:42am
Quoting Leonlorenzo
I wonder where female Investment Bankers hang out... hmmm.

in the office.....i have a few friends that are analysts and they say 100hr weeks arent uncommon.....every weekend i try to get them to go out, and they are always too tired lol!
  • #6
  • Edited 12:52pm Aug 2, 2010 12:47pm | Edited 12:52pm
Yes, investment bankers make a TON of money. It is a very elite "club" though. Considering during this last recession (in the US), we lost Bear Stearns, Lehman Brothers, and Merill Lynch merged with Bank of America, the opportunities to get into such a job are very small.

Those were big brokerage houses with big investment banking divisions.

Goldman Sachs has always been the pinnacle of such opportunities.
So, yeah, exceptional record from Harvard, Stanford, maybe Univ of Chicago or Princeton, with contacts (definitely helps if your father/mother is a big politician).

Chelsea worked at a hedge fund herself (or still does) for awhile.

They start off at maybe $100,000/year potentially with a bonus that big at the end of first year. Maybe after 3-4 years they are making $400,000ish plus bonus if they are good.

I'm sure his father/mother paid for the apartment.

Compared to traders....
If you can jump from a job trading at Goldman and get some people to invest with you and start a fund....
perhaps $10 million under management?
then do 20% your first year, of which you take 20% = $400,000.
Of course, the longer you sustain good returns, the more money you will attract.
Five years down the road with $100 million under management...
you'll blow away any investment banker salary.
  • #7
  • Aug 2, 2010 1:44pm Aug 2, 2010 1:44pm
Quoting Intu
Yes, investment bankers make a TON of money. It is a very elite "club" though. Considering during this last recession (in the US), we lost Bear Stearns, Lehman Brothers, and Merill Lynch merged with Bank of America, the opportunities to get into such a job are very small.

Those were big brokerage houses with big investment banking divisions.

Goldman Sachs has always been the pinnacle of such opportunities.
So, yeah, exceptional record from Harvard, Stanford, maybe Univ of Chicago or Princeton, with contacts (definitely helps if your father/mother...

to get 10mil under management you have to be an exceptionally good trader. you have to be among the top of that 5% that are successful. And mind you when u trade OPM you have to remember investors will have no tolerance for losses so basically its a very very hard thing to do.

Definitely easier to be an investment banker and its certainly easier, you get paid a fixed salary no matter what happens and if you're from an ivy league you're sure to find another job in case you're asked to leave for whatever reason

After all I'll bet you know more investment bankers than you know traders who were able to raise 10 mil.

appears to be a very lucrative profession
  • #8
  • Aug 2, 2010 1:54pm Aug 2, 2010 1:54pm
Quoting fugly
to get 10mil under management you have to be an exceptionally good trader. you have to be among the top of that 5% that are successful. And mind you when u trade OPM you have to remember investors will have no tolerance for losses so basically its a very very hard thing to do.
LOL
  • #9
  • Aug 2, 2010 2:10pm Aug 2, 2010 2:10pm
Quoting pipmutt
LOL
So to get 10 mil under management u have to have a lot of luck?
  • #10
  • Aug 2, 2010 2:32pm Aug 2, 2010 2:32pm
Quoting fugly
to get 10mil under management you have to be an exceptionally good trader. you have to be among the top of that 5% that are successful. And mind you when u trade OPM you have to remember investors will have no tolerance for losses so basically its a very very hard thing to do.

Definitely easier to be an investment banker and its certainly easier, you get paid a fixed salary no matter what happens and if you're from an ivy league you're sure to find another job in case you're asked to leave for whatever reason

After all I'll bet you know...


ill have to disagree with you there........
  • #11
  • Aug 2, 2010 3:43pm Aug 2, 2010 3:43pm
Quoting mfoste1
ill have to disagree with you there........
they do get jobs and are paid their bonuses whatever happens. If you recollect during the bailbout package last year all the investment bankers were still paid their bonuses there was a huge hue and cry about it and Obama had to step in and talk about it. There was the other case about the investment banker from J P morgan or goldman (I forgot which one) the guy who spent something like 20k bailout money to decorate his toilet. I remember hearing it in the news.
  • #12
  • Aug 2, 2010 3:58pm Aug 2, 2010 3:58pm
Quoting fugly
they do get jobs and are paid their bonuses whatever happens. If you recollect during the bailbout package last year all the investment bankers were still paid their bonuses there was a huge hue and cry about it and Obama had to step in and talk about it. There was the other case about the investment banker from J P morgan or goldman (I forgot which one) the guy who spent something like 20k bailout money to decorate his toilet. I remember hearing it in the news.

investment banking is not an easy job by any means......i have a few friends that are in ibanking and they work 100 hr weeks and sometimes they even sleep at the office, they have no life outside of work whatsoever.....they earn their money, well at least younger crowd in ib, analysts associates.....
  • #13
  • Aug 2, 2010 5:41pm Aug 2, 2010 5:41pm
Quoting fugly
Definitely easier to be an investment banker and its certainly easier, you get paid a fixed salary no matter what happens and if you're from an ivy league you're sure to find another job in case you're asked to leave for whatever reason
Its kind of funny that 12 hours ago you had hardly a clue about ib and here a few hours later you are ready to say that it is "definitely easier" to be an ib?

Quote
to get 10mil under management you have to be an exceptionally good trader. you have to be among the top of that 5% that are successful. And mind you when u trade OPM you have to remember investors will have no tolerance for losses so basically its a very very hard thing to do.

And to your statement about OPM. You dont seem to have a clue about opm. Most investors, and I dont mean the ones on zulutrade or rentasignal, dont even bother looking at your daily trading habits, all they care about is what return you get them at the end of the quarter or year. And they also arent looking for the ridiculous returns that retailers want, if you can provide 20-30% returns in a year you will have bags of money thrown at you to trade.

The people you want to stay away from are small retailers, always sitting there watching/critiquing/bitching about every single little loss that happens. In the retail world you are only as good as your last trade. Good thing real investors dont think like that.
  • #14
  • Aug 2, 2010 10:47pm Aug 2, 2010 10:47pm
Quoting mfoste1
investment banking is not an easy job by any means......i have a few friends that are in ibanking and they work 100 hr weeks and sometimes they even sleep at the office, they have no life outside of work whatsoever.....they earn their money, well at least younger crowd in ib, analysts associates.....
tell me mfoste1, what are there qualifications like?
  • #15
  • Aug 3, 2010 12:21am Aug 3, 2010 12:21am
Quoting traderjai_inhi
And to your statement about OPM. You dont seem to have a clue about opm. Most investors, and I dont mean the ones on zulutrade or rentasignal, dont even bother looking at your daily trading habits, all they care about is what return you get them at the end of the quarter or year. And they also arent looking for the ridiculous returns that retailers want, if you can provide 20-30% returns in a year you will have bags of money thrown at you to trade.

The people you want to stay away from are small retailers, always sitting there watching/critiquing/bitching...
Absolutely!

  • #16
  • Aug 3, 2010 3:27am Aug 3, 2010 3:27am
Quoting fugly
And mind you when u trade OPM you have to remember investors will have no tolerance for losses so basically its a very very hard thing to do.
This might be true for those who are investing 5k and are worried as hell about their money. But for those investors who actually have money, most of them understand the nature of investments, that down periods are inevitable and they don't really worry about them.

I've been trading opm for some time now and have hit a couple of long drawdowns and no one has ever complained. They are in for the long haul and think about the annual return, not the weekly or monthly DD.

If you have someone who watches their daily returns as a client, get rid of them, they're not worth having.
  • #17
  • Aug 3, 2010 5:02am Aug 3, 2010 5:02am
Quoting fugly
tell me mfoste1, what are there qualifications like?

specify......
  • #18
  • Aug 3, 2010 5:21am Aug 3, 2010 5:21am
Quoting Dopey

If you have someone who watches their daily returns as a client, get rid of them, they're not worth having.
Agreed, some investors can be a pain in the butt!

The easiest way I've found is to have someone between trader and investor. Raising capital and managing clients is a profession in itself and can be very time consuming as well as distracting for the trader, and different investors need handling in different ways. These guys understand both trading and investing and in my experience are worth every penny of their cut, they've got the difficult job!
  • #19
  • Aug 3, 2010 2:31pm Aug 3, 2010 2:31pm
Originally Posted by fugly http://cdn.forexfactory.com/images/buttons/viewpost.gif
tell me mfoste1, what are there qualifications like?

Most have achieved top grades all the way through their schooling, they are also in most part privately educated. They then go on to take quantitative degrees at top universities and get on to sought after internships.

The degree's they get in to the field with? Physics, Engineering, Maths, Finance, Economics... the more quantitative the better. I've heard of someone who got an internship with a history degree, but it was from Oxford. 2:1 class is a minimum I'd assume.

I've heard that the interviews are interesting; Imagine being asked the question "How many trees are there in Canada?".

Here in the UK the 'Investment banker breading ground' is said to be the London School of Economics because this is where they actively go recruiting.

The 1st part of the application process is usually over the Internet, and to filter out some of the applications (because there are so many) anyone who didn't attend a 'preferred university' is immediately discarded.
Living the adventure in my head.
  • #20
  • Aug 3, 2010 2:47pm Aug 3, 2010 2:47pm
Quoting fugly
to get 10mil under management you have to be an exceptionally good trader. you have to be among the top of that 5% that are successful.
Lol 10 Mil is absolutely nothing. Most semi succesfull CTAs have that much under managment. Remember Madhoff? As long as you make good profits there are enough dumb rich people who will throw in a million or two.
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