by the finance major | Feb 22, 2023 | Career
When applying to finance internships and jobs, it’s incredibly important to have your resume and cover letter polished. A great cover letter can set you apart in certain cases, but your resume is far more important. It’s the hiring manager’s first impression of you and it’s often referenced (if not centered around) during the interview process. Here is the top resume tip to help you get noticed:
The “Breadcrumb Trail” Technique
Go through your resume and find areas where you can incorporate specific numbers (dollars ($), percentages (%), etc.) to show how you made an impact. This could be in reference to a part-time job in high school, a past internship, a capstone college course, or a club you’re involved in or leading. People in finance like to see numbers so it’s important to show quantifiable metrics throughout your resume. Here are a few simple examples of what I’m talking about:
- Increased Finance Society attendance by 67% SoS (semester-over-semester)
- Decreased store expenses by $755 MoM (month-over-month)
- Achieved 113% quota attainment over a twelve-month period by diversifying lead sources
- Increased annual sales by 297% from $79k in 2016 to $314k in 2017
Don’t over do it, but make sure to have a few metrics mixed into your resume. The key is to integrate them into topics you want to talk about and elaborate on. Specific numbers (especially odd numbers) naturally attract attention. Some interviewers may be genuinely curious, while some will try to call you on your BS and have you explain how you got that specific number/metric. Being able to articulately explain each number in detail will blow your interviewer away!
These tips not only help you get noticed, but they can allow you to better control interviews. You can easily anticipate questions ahead of time and have thoughtful, robust answers on deck.
Check out the Resume + Cover Letter Bundle I created to take your internship/job search to the next level!
by the finance major | Feb 22, 2023 | Career, Education
DCF (Discounted Cash Flow) modeling is a type of financial analysis that is used to estimate the intrinsic value of a company. In simpler terms, it’s a way to figure out how much a company is really worth.
To understand how DCF modeling works, imagine that you’re trying to figure out how much money you would make if you bought a rental property and rented it out for several years. To do this, you would estimate how much money you would receive in rent each year, and then subtract your expenses (like property taxes and maintenance costs). You would also factor in the value of the property itself, both now and in the future. And finally, you would adjust all of these estimates to account for the time value of money, which means that money is worth more now than it is in the future.
DCF modeling works in much the same way. To estimate the intrinsic value of a company, you start by estimating the company’s future cash flows (i.e., the money it will make in the future), and then you discount those cash flows to their present value. This is because money you receive in the future is worth less than money you receive today due to inflation, opportunity cost, and other factors.
To do a DCF analysis, you’ll need to make assumptions about the company’s future growth rate, revenue, and expenses, as well as its capital expenditures, depreciation, and tax rate. You’ll also need to determine the discount rate, which reflects the time value of money and the risk of the investment. The discount rate is typically based on the company’s cost of capital, which is a measure of how much it costs to finance the company’s operations.
Once you’ve estimated the company’s future cash flows and determined the appropriate discount rate, you can use a financial calculator or spreadsheet software to calculate the present value of the cash flows. This gives you an estimate of the intrinsic value of the company.
It’s important to note that DCF modeling is just one way to estimate the value of a company, and it has its limitations. It relies heavily on the accuracy of the assumptions you make, which can be difficult to predict, and it doesn’t take into account factors like market sentiment or the competitive landscape. However, it is a widely used tool in finance and can be helpful in evaluating the potential value of an investment.
When interviewing for finance internships and jobs, it’s important to be familiar with DCF modeling and to be able to explain how it works.
Click here for a detailed guide of a DCF calculation.
by the finance major | Feb 20, 2023 | Career, Education
The largest investment banks with operations in the United States, based on their total assets and global presence, are:
- JPMorgan Chase: With over $3 trillion in assets, JPMorgan Chase is the largest investment bank in the U.S. and offers a range of services including investment banking, asset management, commercial banking, and more.
- Goldman Sachs: Goldman Sachs is a leading global investment bank with over $1 trillion in assets and a reputation for advising on some of the largest and most complex deals in the industry.
- Morgan Stanley: Morgan Stanley is a global investment bank with over $900 billion in assets and a focus on providing financial advice and investment banking services to corporations, governments, institutions, and individuals.
- Bank of America Merrill Lynch: Bank of America Merrill Lynch is a leading investment bank with over $2.5 trillion in assets and a strong presence in the U.S. and international markets.
- Citigroup: Citigroup is a global investment bank with over $1.9 trillion in assets and a presence in more than 160 countries. The bank offers a range of services including investment banking, commercial banking, and wealth management.
- Deutsche Bank: Deutsche Bank is a global investment bank with over $1.7 trillion in assets and a significant presence in the U.S. The bank provides a range of services including investment banking, wealth management, and retail banking.
- Credit Suisse: Credit Suisse is a global investment bank with over $1.1 trillion in assets and a strong focus on providing financial advice and investment banking services to corporations, institutions, and high net worth individuals.
- Barclays: Barclays is a global investment bank with over $1.4 trillion in assets and a presence in over 40 countries. The bank provides a range of services including investment banking, wealth management, and retail banking.
- UBS: UBS is a global investment bank with over $1.1 trillion in assets and a strong presence in the U.S. The bank provides a range of services including investment banking, wealth management, and retail banking.
The rankings and assets of these investment banks obviously fluctuate over time, and there are other important investment banks operating in the U.S. as well.
by the finance major | Feb 20, 2023 | Education
The Great Recession was a period of time between 2007 and 2009 when there was a severe economic downturn in many countries, including the United States. It was triggered by a housing market crash, which led to a financial crisis that spread throughout the entire global financial system.
The housing market had been growing rapidly in the early 2000s, and many people were buying homes with subprime mortgages they couldn’t really afford. Banks and other lenders were giving out these loans to many people who didn’t have good credit or steady jobs. When the housing market bubble eventually burst, home prices began to decline, leaving many homeowners with mortgages that were worth more than their homes. This led to a wave of defaults and foreclosures, which caused the value of mortgage-backed securities and other investments based on these mortgages to plummet.
Many banks and financial institutions had invested heavily in these securities, and when their values dropped, many of these institutions became insolvent or went bankrupt. This created a financial crisis, as many investors and businesses lost confidence in the financial system, leading to a credit crunch and a severe economic contraction.
The Great Recession led to high levels of unemployment, a decrease in consumer and business spending, and a decline in economic growth. Governments around the world implemented policies to try to stabilize the financial system and stimulate economic growth, including fiscal stimulus programs and monetary policies such as low interest rates and quantitative easing. The effects of the Great Recession were felt for years, and it is considered to be one of the worst economic crises in modern history.
Check out The Big Short, a movie which details the lead up and development of the crash. If you haven’t already, make sure to watch the other movies on this list of finance classics!
by the finance major | Feb 20, 2023 | Education
The Great Depression was a period of extreme economic hardship that began in the late 1920s and lasted throughout the 1930s. It started in the United States but quickly spread to other countries around the world.
During the 1920s, there was a lot of speculation in the stock market, which caused stock prices to rise rapidly. However, many of the people investing in the stock market did not have the financial means to support their investments, and when the stock market crashed in 1929, many people lost their life savings.
The crash of the stock market led to a decline in consumer spending, which in turn led to a decline in production and employment. As people lost their jobs, they had less money to spend, which caused businesses to struggle even more. This downward spiral led to a period of extreme poverty and hardship for many people.
To make matters worse, many banks failed during this time, which led to widespread panic and bank runs. People lost their savings when banks closed, and many businesses were forced to close as a result.
The Great Depression ultimately came to an end with the start of World War II, which brought about a large increase in government spending and a surge in economic activity. However, the Great Depression remains an important event in world history and a reminder of the importance of sound economic policies and financial regulation.
