Investment banking is a business segment specializing in financial consultancy services and helping individuals and corporations raise capital. Investment banks serve as arbitrators between security issuers and shareholders. Investment banks either buy publicly traded shares at a price estimated by their financial experts or resell them on behalf of the issuer.
Investment banking features on the list of the most complicated financial mechanisms in the world. They are responsible for various business transactions. They specialize in different types of financial transactions such as mergers and acquisitions, proprietary trading, and financial advisory services. Investment banks offer financial aid to help organizations purchase assets and settle purchases. Furthermore, Investment banks offer advisory service regarding business restructuring to improve efficiency and maximize profit.
To understand how investment banking works, think of a company ABC acquiring company XYZ. Company ABC may not be sure how worth is company XYZ and the long-term benefits of the acquisition. As such, the investment bank evaluates the value of company XYZ on behalf of company ABC and settles the deal by providing necessary documentation and advising the appropriate time for the merger. In this scenario, the investment bank works on the buy side, and another investment bank may work on the sell side to help XYZ. The higher the value of the deal, the higher commission the bank will earn. Some of the world’s leading investment banks are Bank of America, JP Morgan, Barclays Capital, and Citigroup Investment.
About: Martin Lustgarten
Martin Lustgarten is an inspiration to many investors across the world. Throughout his career as an investment advisor, Martin Lustgarten works incredibly smart to find the best investment opportunities for his clients. With vast knowledge and experience in understanding emerging market trends, Lustgarten reacts quickly when the market is about to make a downturn.
For investors wishing to have a successful portfolio, they should implement Martin’s investment model. Furthermore, Martin Lustargen encourages global portfolio as it reduces the expected risk while riding on the success of the local economy. As such, investors wishing to retire well should consistently incorporate Lustgarten’s investment tips.