How much does an Average Investment Banker Earn

Sunday, January 24, 2010

How much does an Average Investment Banker Earn

If you plan to become a part of investment banking workforce, the most common question to ask is the average earning of a worker in this field. Though there are a lot of negative things about the job such as no time for family and friends or being at the mercy of your client, this is a high paying job. Of course before becoming one, you would need to acquire good education, stellar grades and good internships. On the average, they earn 2% commission from their sales. Example if they convince a person to put in $2,000,000 of investment, they can get $40,000. Of course there are some that sell for billions. They often charge their expenses like food, travel, hotels and transportation to the client.
How does an investment banker earn



The work of investment bankers are not the simple. Bankers sell companies and get paid through commission. The larger they sell, the more they get. Another thing why average banker earns a lot is because of the margin. They handle a lot of money all the time. The only expense bankers handle is their office. Other expenses are insignificant compared to the multi dollar fee they charge. In short, investment bankers earn a lot of money because of hefty commissions but no expenses.
For private equity and hedge fund, they also make a lot of money. The difference is that they get other income called carry which is return of investments. For funds that do well, this creates huge wealth. There are small numbers of people who can get into the industry. Getting an investment banking job is rather difficult. This is because they limit people who break in and raise money out of it. Being an investment banker is a good idea especially if you want to earn huge amount of money. It is pretty lucrative industry that you should get into.

7 comments:

Anonymous said...

Hi, I am a regular reader of your blog. very much interested in this industry.how much does average analyst and associates make including bonuses ?

Anonymous said...

ibankers are often a bunch of crooks, Sun Life never took a bailout.

Have you seen their recent commercials? They're great.

http://www.youtube.com/watch?v=GYWGEbIhSMg

Anonymous said...

Hello,

Do you know know anything about introduction fees at investment banks? I work at a boutique investment bank and have recently brought in a deal which, if completed, will be the largest deal for the bank to date. I am now wondering if I am entitled to any introduction/finding fee and if so, how much I should expect to get.

Many thanks

Siddharth said...

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http://www.hindujagroup.com/

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Leonhart said...

I recently came across your blog and have been reading along. I thought I would leave my first comment. I don’t know what to say except that I have enjoyed reading.

Anonymous said...

my dad's a private banker and he's not a crook. We have an average home, two cars under lease. We live near the water but we dont have a boat. He makes under 200 grand a year with a bonus. So to those who call bankers crooks, stop. There making a living like everyone else.