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Be a knockout success in 3 rounds

So you've sent in your covering letter and CV to that financial company you want to work for. You like them, they like you, and you're invited to the first round of interviews. What can you expect next?
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Investment banking

When I got hired by Goldman Sachs, I was put through 47 interviews. Thankfully you won't have to go through that many! But just like I was, you will almost certainly be asked the classic competency questions: why do you want the job? Why are you interested in the area? Why would you be good at the job? What would your best friend say about you?

These are competency-type questions. The idea behind them is twofold: to assess whether you would actually be able to do the job, and they are also seen as fair since all candidates are asked pretty much the same questions.

There are only around 80 competency-type questions that they all ask in the round one interview. So preparation is easy. The first thing you need to do is write down all the questions of this type that you can think of, and then write down your answers to them. Also make a list of your all time top ten 10 achievements so that you are able to give impressive examples of things that you have done.

Going for the TKO

Let's say you take my advice, and you're invited to the next round of interviews (in some cases this stage can involve two). These are much more about technical knowledge; that is, a good understanding of what the job you are applying for involves on a day-to-day basis. Put simply, to successfully get through this stage you need to demonstrate that you understand where the interviewer is coming from.

The bottom line is this: interviewing is all about selling yourself, so the natural sales people are the first to get the job offers. However, there is just no substitute for technical knowledge. Don't fall into the trap of believing technical knowledge doesn't matter, as some company presentations might lead you to believe. Make the effort to learn some technical knowledge and you will easily outshine other candidates who do not have any.

Let me give you a few examples of the type of technical knowledge that would impress interviewers.

For law interviews, you would talk about three recent cases that affected the business area of law that you are specifically targeting, describing the details of the case, the outcome and why it was significant from a legal standpoint.

For an investment banking division (IBD) interview you might talk about different methods of valuation. While describing comparable ratios, you might mention EV/EBITDA, PE, PE/Growth, EV/Sales, and be ready to explain in what situations these ratios may be most valid.

Some of you may be interested in management consulting. The good news is that there really isn't any technical knowledge you need to prepare for that, but you do need to know a lot about how to handle verbal case studies.

The Doorstep Challenge

At the final round, everyone is smart, everyone is hardworking, and everyone is articulate. In short,any one of you could do the job. So how are companies to decide who to give the job to? Well, they are going to pick the person that seems to best understand the business and who has the highest level of technical knowledge. They figure that this person is probably more motivated, and therefore probably better capable of hitting the ground running when they join the team. This presents you with a potential major problembecause acquiring the technical knowledge that you need to convince your interviewer that you know what you are talking and stand out from the crowd can be hard to come by. The solution is on your door step: campus presentations. The key is to see these as less an opportunity to stock up on free stationery and more an invaluable chance to ask industry professionals questions in order to get a handle on the technical knowledge you need to get that internship or full time job.

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Other knowledge you need to have includes an ability to give an opinion, with reasons, on the major macroeconomic issues, an ability to handle brainteasers which they sometimes use to supposedly test your mathematical and reasoning ability, three or four trading or investment ideas to see whether you have a real interest in the final markets, an ability to handle the group exercises, presentations and case studies (which you can definitely practice for and get much, much better than other candidates), and of course knowing what kind of interview style they are looking for. You will only learn that by practicing with people who have been through the process before you.

Getting into a discussion about the latest financial news stories can impress interviewers in most companies because they want to see a passion for business. For example, the story of last week would probably be either oil, which has traded at $84 per barrel or the fact that stock markets around the world are near their all time highs. You need to sound informed. How come the UK equity market is near a seven year high when UK house prices are falling at the fastest pace in two years, the Chancellor is lowing UK growth forecasts, the Treasury is standing behind Northern Rock which would collapse otherwise, and the UK's biggest banks still do not want to lend to each other. It does not sound like a great time for markets to be rising, right? Equity strategists believe the main factor is something called decoupling. The idea is that the economies of the developed West and the developing brick countries of Brazil, Russia, India and China are not closely correlated. Slow down in the West is compensated by growth in emerging markets, and this growth is good for large UK companies (and big FTSE100 constituents) who make relatively little of their profits in the UK. For example, Vodafone, BP and Royal Dutch Shell, along with a the whole mining sector are helping the FTSE100 index to new peaks. There is plenty more you could say, and you could find the facts from any decent newspaper article. You might even be able to sound more informed than your interviewer if you spend say one hour, preparing your pitch before the interview.


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