and #3 - guy works 50-65 per week but all his colleagues claim 80. So as not to be perceived as a slacker, he too claims 80.
and #3 - guy works 50-65 per week but all his colleagues claim 80. So as not to be perceived as a slacker, he too claims 80.
They work the hours because they can make more from commission than their salaries. Usually after 5 years they have a big enough book of business to earn over a million. Most don't make the 5 year mark because it is a hard job. The salary is a small portion of their net income so the harder they work the more money they make. They also work early because most business men do. It's a grind, and not for everyone, but for the ones willing to work hard for five years or so it's a great career.
Why? Because when they get promoted to manage a fund, they have incredibly earning potential.
Former teammate of mine pulled in $30 million last year in bonuses.
The better question is "Why do investment bankers even exist?" 95% of so called experts can't beat the DOW or S&P. Those that do, do it sporadically.
BetterQuestion wrote:
The better question is "Why do investment bankers even exist?" 95% of so called experts can't beat the DOW or S&P. Those that do, do it sporadically.
Investment Banker's aren't trying to "beat the market". They care about market activity and fee's, little else.
75h/week is probably a good average. Sometimes more, sometimes less depending on where you work, how many deals you have going on, etc. You're always going to be in early, out late, some to all weekends.
Debating the exact avg, salaries, motivations is stupid. I could easily start a thread "Why do slower than 14 minute 5k runners run 100mpw". Different strokes for different folks.
Source: Work in IB
$$$
tse wrote:
BetterQuestion wrote:The better question is "Why do investment bankers even exist?" 95% of so called experts can't beat the DOW or S&P. Those that do, do it sporadically.
Investment Banker's aren't trying to "beat the market". They care about market activity and fee's, little else.
75h/week is probably a good average. Sometimes more, sometimes less depending on where you work, how many deals you have going on, etc. You're always going to be in early, out late, some to all weekends.
Debating the exact avg, salaries, motivations is stupid. I could easily start a thread "Why do slower than 14 minute 5k runners run 100mpw". Different strokes for different folks.
Source: Work in IB
Exactly - they aren't taking risk for the most part. It's amazing to hear people explain what they think people do at IBs. They seem genuinely surprised to hear that the job is basically sales and they make their money on volume x margin. They're just the middlemen - the central marketplace for people with actual risk to buy/sell to be matched up with people who need to sell/buy. This is why the job is demanding - the formula for getting paid is to outsell your competitors. This often boils down to working harder/longer than them.
And I'll say again for the dipshiit who seemed to disagree with me - many of these guys really do wish they too could be on the buy-side instead of the sell-side. The hours are manageable usually on the buy-side and the rewards have the potential to be huge.
Hours exaggeration is more common in finance than in law, because bankers don't have to bill by the hour and carefully document how they spent every 6 minutes increment of time. During particularly heavy times in banking, a lot of that time spent "working" is actually waiting for someone else to turn something around so you can keep working. That's what the cot is for. Analyst sends something to associate at 1 in the morning, lays down for an hour, gets up and continues working. Bankers consider all that time "hours worked." (Not to imply that I think napping on a cot at the office for an hour counts as some kind of pleasant recreational activity.) And even during slow times, face time is important, so people will be at the office on espn.com or just messing around. This all counts as time worked. In other professions, if things slow down, people are more likely to go on vacation.
For what it's worth, Goldman now has a no working on the weekend policy for junior bankers unless there's special authorization. I don't recall at what point the rule no longer applies, but I've got a good friend there who is already a few years post MBA, and it applies to him. He goes to the Hamptons pretty much every weekend. His typical weekday hours are about 10am to 11pm.
Regarding why finance requires such long hours (the original question): Part of it has to do with uneven workflow. Would you rather have twice as many employees so they can easily handle the workload at heavy times, and then have them be relatively idle during normal times? Or would you rather have employees who can keep pretty busy all the time, and who occasionally have to work every waking hour?
Another issue is the hours/$$ tradeoff. For a long time, bankers have been making clear that they prefer more money to more free time, so the profession has evolved to accommodate their preferences. A big part of that is the relationship between money and prestige in finance. While money is associated with prestige in many professions, the relationship is much tighter in finance. It's not just what you can buy; it's the symbolic meaning of the compensation. Yet, at the moment the pendulum seems to be swinging slightly back: Attrition rates have started to demonstrate that marginal utility of more free time (at least at the hours/compensation levels bankers are currently at) exceeds the marginal utility of more money.
tse wrote:
BetterQuestion wrote:The better question is "Why do investment bankers even exist?" 95% of so called experts can't beat the DOW or S&P. Those that do, do it sporadically.
Investment Banker's aren't trying to "beat the market". They care about market activity and fee's, little else.
75h/week is probably a good average. Sometimes more, sometimes less depending on where you work, how many deals you have going on, etc. You're always going to be in early, out late, some to all weekends.
Debating the exact avg, salaries, motivations is stupid. I could easily start a thread "Why do slower than 14 minute 5k runners run 100mpw". Different strokes for different folks.
Source: Work in IB
That explanation suits my taste.
I worked for a bulge bracket firm for 8 years with half the time in IB client coverage and half in an IB product group. When I was in the office my week days would start at 8:30am-9am and end at 9pm-midnight. Saturday was usually 11am-5pm. Sunday was usually noon-10pm. Always in the 70-80 hour per week range. That said, on average I'd be on the road 2-3 days per week. Traveling for work is incredibly inefficient. You get up at 4am to catch an early flight. Spend 2-4 hours in the air. Attend a 2-3 hour meeting and then you're on to the next city. Much of your office time is spent preparing for these meetings and that's where after hours and weekend work become critical. There is also a culture of turning client requests as fast as possible. If a client asks for a financing pitch at 4pm on a Thursday, you espect your analyst/associate to have a draft pitch book in front of you some time on Friday so you can refine it over the weekend for a Monday client call. Sometimes you get less time than that with the paramount concern being speed to market. You don't want others beating you to the punch. It drives long hours given compressed deadlines and low capacity.
I agree with the comments on uneven work flow but banks also intentionally under staff as a means of justifying high bonus figures. Banks could choose to staff up but pay goes down accordingly and bankers would rather work 2x as much to get paid 2x as much. I now work in commercial banking at same firm and work 40-45 hours per week. That said, my pay is 50-60% of what it was when in the IB. Money becomes an ego thing and even though most bankers have more than they need, they use total comp as a personal measuring stick.
Investment banking and big law pound associates with big hours for largely the same reason. Both are engaging in incredibly over the top CYA for their clients. In big law, if you lose the big case or the big deal blows up, you want to be able to show that you researched every issue, filed every motion, pursued discovery to the ends of the Earth. that way, in-house counsel will be able to say to the execs that they did everything they could and had the best working 24/7. Similarly, in investment banking, due diligence, research and analysis are all taken to the absolute limits of the Earth in order to be able to justify the huge fee and to CYA if things go south.
As for the why do they do it, it is largely a weed out system to find out who will be promoted to partnership/shareholder status. There are piles of super smart people coming out of Ivies and other big name business and finance programs. They can all do the work. In order to sort people out, firms set up feats of strength--namely big hours and over tasking associates. Many will just walk away from it. This weed out is very valuable at large firms that have exposure to civil rights claims for not advancing minorities and women. If you can cull the herd just by attrition, you minimize your liability for failing to promote because employees have no claim if they quit before they are up for consideration.
800 dude wrote:
For what it's worth, Goldman now has a no working on the weekend policy for junior bankers unless there's special authorization.
It's a a protected Saturday off once a month and you will probably have to work that anyway because you can get manager/associate sign off for an exception if you are working on something 'important' cough cough (everything is 'important').
Plus you will make those hours up anyway if you do take your protected Saturday off during the week with extra hours in the office.
The rule is a joke.
BetterQuestion wrote:
The better question is "Why do investment bankers even exist?" 95% of so called experts can't beat the DOW or S&P. Those that do, do it sporadically.
You have no idea what investment bankers do.
They don't trade equities so there is no market to beat.
They care about deal flow IE mergers/acquisitions for example and charging clients massive fees which is how they make their money.
Time fixer wrote:
Why? Because when they get promoted to manage a fund, they have incredibly earning potential.
Former teammate of mine pulled in $30 million last year in bonuses.
Ibankers don't manage funds....
commission wrote:
They work the hours because they can make more from commission than their salaries. Usually after 5 years they have a big enough book of business to earn over a million. Most don't make the 5 year mark because it is a hard job. The salary is a small portion of their net income so the harder they work the more money they make. They also work early because most business men do. It's a grind, and not for everyone, but for the ones willing to work hard for five years or so it's a great career.
They don't make commission. You get a base salary and a bonus - the amount of the bonus is based on how you are ranked compared to your peers.
75% of the posters in this thread don't even know what investment banking is.
Because the gots their mind on their money and their money on their mind!
TLW wrote:
Ibankers don't manage funds....
They don't make commission. You get a base salary and a bonus - the amount of the bonus is based on how you are ranked compared to your peers.
75% of the posters in this thread don't even know what investment banking is.
"Investment banking" is a bit of an oxymoron and leads to the confusion. Simply put: they are not bankers in the strictest terms whatsoever.
99.9% of the population doesn't understand the definition of terms like "investment bank" , "wall street" , "hedge fund" , etc and this leads to foolish behaviours and policy.
Investment banks are broker / dealers and that is how we should refer to them to help avoid a certain degree of confusion.
whatsmyname wrote:
The #1 thing that teen males lie or exaggerate is the number of sexual partners they have had. If they say it enough, they almost believe their own tales.
The #1 thing that adults (male or female) lie or exaggerate is the number of hours they work per week. Unlike the teen, though they don't just "almost" believe it but they actually believe their own tales.
Here how it works:
1. Guy works a 2-week stretch where his hours are 80 per week. Then he goes back to the normal 55. Does he say he averages 60? No, the high week of 80 is what he says is his new "average".
2. Girl gets an email on a weekend morning at 9am and has to do some research on it. In the middle, at 11am she goes to the mall, has lunch with a friend, runs some errands. She gets back at 5pm and returns to her work assignment. Doesn't finish till 7pm. Ah, 10-hours of work put in on a Saturday!
This is why teachers on the internet claim to work 60 hours a week. They grade 25 tests in front of the TV over the course of 6 hours instead of sitting down and knocking it out in an hour.
TLW wrote:
BetterQuestion wrote:The better question is "Why do investment bankers even exist?" 95% of so called experts can't beat the DOW or S&P. Those that do, do it sporadically.
You have no idea what investment bankers do.
They don't trade equities so there is no market to beat.
They care about deal flow IE mergers/acquisitions for example and charging clients massive fees which is how they make their money.
^This is correct. I find people use the term investment banker interchangeably when they shouldn't. For reference:
Investment banker: Helps a company raise capital
Investment Manager: trades equities, bonds, etc. in the "market"
Source: I work in the industry
For any kid who thinks that banking is a good idea, you cannot run well and be a banker. The average week is 80hours and a bad week is 100. There are no 50-60hr weeks.