Investment Banking: Rich rewards for the bold

Money makes the world go round. Even a decadent drunk in a Weimar bar knows that. The trick is to understand how. And to excel as an investment banker, you have to be as interested in the world as you are in money.

Money makes the world go round. Even a decadent drunk in a Weimar bar knows that. The trick is to understand how. And to excel as an investment banker, you have to be as interested in the world as you are in money.

Morgan Stanley, JP Morgan, Goldman Sachs - these are golden names in the public imagination, suggesting an Aladdin's cave of riches. And the rewards in investment banking are excellent - after starting at about £30,000, you can be earning six figures within a few years and millions at the height of your career. But you will have to work for it; 12 hours a day or more is the norm. To survive the hours, you need to be motivated by curiosity as much as money.

The selection process alone would test the mettle of the most confident. Mark Beith, 22, is typical of the fierce competition you will face. Now a mergers and acquisitions analyst at Morgan Stanley, Beith joined the graduate training programme after notching up a first in history from Cambridge University.

He believes it's not enough to be money-motivated. "Learning is the most important thing, and the challenge," he says. "You wouldn't enjoy yourself if cash was your only motivation. But if you get satisfaction from problem-solving, playing with numbers and pushing yourself to achieve, it is a rewarding job."

Mergers and acquisitions - the buying and selling of companies - involves an understanding of markets, business and finance. But you can pick this up on the job, and intelligence and diligence matter more than an economics background.

"I chose investment banking partly because it was so different to everything I'd done before," Beith says. "I thought it would be a fantastic chance to learn about the business world. And I'm not sure there are any other careers where a 21-year-old gets as many chances to interact with the bosses of FTSE 100 companies."

Mergers and acquisitions are traditionally investment banks' biggest business, but in recent years the greatest area of recruitment has been in capital markets. In interest-rate derivatives markets, bankers take on risks for companies, such as a floating loan, where the risk is of rising interest rates.

Interest rates are driven by a wide range of range of financial, economic and political factors, and your job is to advise companies on how to match changes in rates to their own business. So you need a grasp of everything going on in the world, and to be able to translate that information quickly through the mechanisms of the market.

Pooja Bhatia, 24, is an analyst in interest-rate derivatives with JP Morgan. After completing an economics degree in India, she studied management at the LSE and did three months' work experience in foreign exchange (FX) markets at JP Morgan before getting on the graduate recruitment programme. FX is very different from derivatives, but it served as an introduction to the business. "It's a big, bad, difficult world," Bhatia says. "You have to see what it's like before you commit."

Bhatia is part of a bold new generation, not cast in the traditional image of a banker but confident that they will be judged on their performance. If, like her, you have the brains and guts to see it through, the rewards are tremendous. "Traders are going ballistic, your clients are too," Bhatia says. "I enjoy the excitement. It's not something everyone can do, but if you're successful it's a high, it's a kick."

Most investment banking is a mix of understanding businesses and the market. But there are some areas where internal business affairs have little influence on your decisions, and there's a greater need to understand market mechanisms and the way the world drives them.

This is the case with foreign currency markets. Iva Jovanovic, 23, works in fixed-income foreign currency sales at Goldman Sachs, advising clients on which currencies to invest in and which to avoid. She was turned on to investment banking during an internship at the end of the second year of her degree at Warwick.

"Before the internship, I didn't have much of an idea about banking," she says. After getting a first, she joined Goldman Sachs as a graduate trainee. She chose FICC sales because it combined maths with client contact. Like everyone in the industry, she puts a premium on curiosity. "It can be hard to understand movements in the markets. You're looking at why things have moved."

And if you want to understand more about business, Jovanovic has simple advice. "Give it a shot, it's worth trying. Even if you decide it's not what you want to do for your whole life, it's a great experience."