Finance Interview Questions
December 22, 2009 8:50 AM Subscribe
I am being interviewed for a Summer Internship position at an NYC bank tomorrow. I have some questions about this inside.
Firstly, I will be expected to be very familiar with current financial news, market trends, etc. I have not been reading the WSJ every day, so I ask you: what are the most important current events in the financial world that I should make sure to review before I get quizzed about them? Which news stories should I make sure to know about?
Second, what are the kinds of questions that they would ask a math-y person without a finance background? What is the best way to answer them?
Third, do you have any other specific tips for me?
Firstly, I will be expected to be very familiar with current financial news, market trends, etc. I have not been reading the WSJ every day, so I ask you: what are the most important current events in the financial world that I should make sure to review before I get quizzed about them? Which news stories should I make sure to know about?
Second, what are the kinds of questions that they would ask a math-y person without a finance background? What is the best way to answer them?
Third, do you have any other specific tips for me?
Current events to know about:
- the bailout plan / TARP
- how markets have been performing lately
- recent M&A (maybe the failed Google / Yelp acquisition)
Questions they might ask a "math-y" person:
- brainteasers (i.e. how many ping-pong balls would fill this room; how many washing machines are there in NYC, etc.). With these you're obviously not expected to get a correct answer, they're much more interested in how you think things through. Talk out loud as your get to your 'answer.'
- mental math questions (i.e. what is 7 cubed?) Again, with these, they're probably more interested in how you think about it--so for 7 cubed, you could say, "7 x 7 = 49, 50 x 7 = 350, 350 - 7 = 343
- finance questions (i.e. how do you calculated WACC?; walk me through the 3 financial statements--sometimes presented as "our accounting department overstated depreciation by $20 million, walk me through how that effects each statement"). If you have time, I recommend picking up the Vault Guide to Finance Interviews. It has a lot of good tips and refreshers if you're rusty on any topics.
Other Specific Tips:
- Know why you want to do finance
- Know why you did business/math-y stuff in college or in previous work experiences
- Know your resume cold (i.e. don't get caught off guard when someone asks you about one of your older job experiences)
- Be prepared to talk about your strengths and weaknesses (I always would say that my weakness is that I can be a bit stubborn, but that sometimes it ends up being a strength, blah blah blah...)
- A firm handshake, confidence, and looking the interviewer in the eye are grossly undervalued interview skills
- If you don't know something, don't try and guess--you'll probably end up looking stupid. Say that you don't know, but that you'd like to learn more about that subject or something.
posted by arm426 at 9:31 AM on December 22, 2009 [1 favorite]
- the bailout plan / TARP
- how markets have been performing lately
- recent M&A (maybe the failed Google / Yelp acquisition)
Questions they might ask a "math-y" person:
- brainteasers (i.e. how many ping-pong balls would fill this room; how many washing machines are there in NYC, etc.). With these you're obviously not expected to get a correct answer, they're much more interested in how you think things through. Talk out loud as your get to your 'answer.'
- mental math questions (i.e. what is 7 cubed?) Again, with these, they're probably more interested in how you think about it--so for 7 cubed, you could say, "7 x 7 = 49, 50 x 7 = 350, 350 - 7 = 343
- finance questions (i.e. how do you calculated WACC?; walk me through the 3 financial statements--sometimes presented as "our accounting department overstated depreciation by $20 million, walk me through how that effects each statement"). If you have time, I recommend picking up the Vault Guide to Finance Interviews. It has a lot of good tips and refreshers if you're rusty on any topics.
Other Specific Tips:
- Know why you want to do finance
- Know why you did business/math-y stuff in college or in previous work experiences
- Know your resume cold (i.e. don't get caught off guard when someone asks you about one of your older job experiences)
- Be prepared to talk about your strengths and weaknesses (I always would say that my weakness is that I can be a bit stubborn, but that sometimes it ends up being a strength, blah blah blah...)
- A firm handshake, confidence, and looking the interviewer in the eye are grossly undervalued interview skills
- If you don't know something, don't try and guess--you'll probably end up looking stupid. Say that you don't know, but that you'd like to learn more about that subject or something.
posted by arm426 at 9:31 AM on December 22, 2009 [1 favorite]
Your first question is essentially unanswerable. Finance is a broad, evolving discipline and a couple of quick reads aren't going to keep you up to date. To genuinely understand the financial markets, you need an understanding of current events, history, politics and be able to apply all of that to finance. Your best bet may be to memorize the names and roles of key people. (Note: that article is a few months old.) Then hop over to the WSJ website or Bloomberg and hope to pick up enough to fake it.
Luckily, you're an intern. No one expects you to understand this stuff fully.
Be prepared for a math/logic test. Bring a calculator or you iPhone or whatever you use to do moderately complex math on the fly. In the job, you'd use a computer to do these calculations, but you might be stuck taking the paper test.
Good luck!
posted by 26.2 at 9:42 AM on December 22, 2009
Luckily, you're an intern. No one expects you to understand this stuff fully.
Be prepared for a math/logic test. Bring a calculator or you iPhone or whatever you use to do moderately complex math on the fly. In the job, you'd use a computer to do these calculations, but you might be stuck taking the paper test.
Good luck!
posted by 26.2 at 9:42 AM on December 22, 2009
I'm going to assume this is for a front office position (since you're not more specific in your question).
The above suggestions for reading Dealbook and SeekingAlpha are good, if you are interviewing for a front office position. Not so much so for back office positions like accounting or IT.
That said, you say you are interviewing for an internship. I wouldn't concern yourself so much with financial arcana. If you're interviewing for an internship you are still in college. Even if you are a financial whiz you won't do much finance as an intern on Wall St.
What I would expect is for the interviewer(s) to ask you about your background, your interest in finance, how/why you think your educational background in major X can help you do the work at an investment bank, etc.
I would not expect questions on stock prices, yield curves, market capitalizations, investment recommendations, etc.
posted by dfriedman at 9:46 AM on December 22, 2009
The above suggestions for reading Dealbook and SeekingAlpha are good, if you are interviewing for a front office position. Not so much so for back office positions like accounting or IT.
That said, you say you are interviewing for an internship. I wouldn't concern yourself so much with financial arcana. If you're interviewing for an internship you are still in college. Even if you are a financial whiz you won't do much finance as an intern on Wall St.
What I would expect is for the interviewer(s) to ask you about your background, your interest in finance, how/why you think your educational background in major X can help you do the work at an investment bank, etc.
I would not expect questions on stock prices, yield curves, market capitalizations, investment recommendations, etc.
posted by dfriedman at 9:46 AM on December 22, 2009
I've done this a few times in college, so here's what I've learned
Since you don't have finance background, I would almost guarantee that you're not expected to answer finance-related questions (e.g. financial models, concepts, etc). What they may ask you are the following:
- know your resume cold: for a college student, this means your coursework, why you're going to the school you're at, your extra-curriculars and what you learned from them, know your short-term goals (and always have examples for each point you want to make - e.g. i'm a team player because I successfully worked on project X with classmate A, B, C, D)
- your quantitative background (financial firms like to think of themselves as analytical/quantitative), so they may ask you about your past coursework, or give you a problem to solve - actually, most of the time, I got a probability question or brainteaser)
- your interest in finance/their company (I would research on their website like there's no tomorrow, know what they do, what your group does, who their ceo is, what their culture is like). Usually the best way to nail this question is to talk to people who work there, but given your interview is tomorrow, that might not happen.
- what makes you fit in (more than anything, finance companies hire people they want to work with, this is actually true of any company. I mean, who wants to work with a bore or an a$$0le right? So be personable/charismatic)
- always prepare a handy list of questions you want to ask the interviewers - this shows them your genuine interest in their company, and a chance for you to get to know your future colleagues
I would also ask for their business cards at the end, if anything, it's good networking
In college, I used the vault guides for finance/consulting industries, you may want to look into that
At the end of the day, most of this is BS, you just need to know what they want to hear, and you learn that through experience/talking to other people in the industry
Good LUCK!
posted by frozenyogurt at 12:05 PM on December 22, 2009
Since you don't have finance background, I would almost guarantee that you're not expected to answer finance-related questions (e.g. financial models, concepts, etc). What they may ask you are the following:
- know your resume cold: for a college student, this means your coursework, why you're going to the school you're at, your extra-curriculars and what you learned from them, know your short-term goals (and always have examples for each point you want to make - e.g. i'm a team player because I successfully worked on project X with classmate A, B, C, D)
- your quantitative background (financial firms like to think of themselves as analytical/quantitative), so they may ask you about your past coursework, or give you a problem to solve - actually, most of the time, I got a probability question or brainteaser)
- your interest in finance/their company (I would research on their website like there's no tomorrow, know what they do, what your group does, who their ceo is, what their culture is like). Usually the best way to nail this question is to talk to people who work there, but given your interview is tomorrow, that might not happen.
- what makes you fit in (more than anything, finance companies hire people they want to work with, this is actually true of any company. I mean, who wants to work with a bore or an a$$0le right? So be personable/charismatic)
- always prepare a handy list of questions you want to ask the interviewers - this shows them your genuine interest in their company, and a chance for you to get to know your future colleagues
I would also ask for their business cards at the end, if anything, it's good networking
In college, I used the vault guides for finance/consulting industries, you may want to look into that
At the end of the day, most of this is BS, you just need to know what they want to hear, and you learn that through experience/talking to other people in the industry
Good LUCK!
posted by frozenyogurt at 12:05 PM on December 22, 2009
This thread is closed to new comments.
In general, you're right that the key issue for a non-finance person is proving that you really want to work in finance. I think if you signed up for something like the NYT's daily Dealbook emails and SeekingAlpha's Wall Street Breakfast emails, you'll be able to skim the top stories.
Also, it sounds silly, but before going into an interview with a bank, make sure you know its share price (most recent close, not intra-day). Also, know approximately what the S&P 500 and 10-year treasury yield are trading at.
posted by mullacc at 9:28 AM on December 22, 2009