We’ve talked about banks. But I recently read about an investment bank. But what is an investment bank anyway?
An investment bank is a specialized type of bank that performs large and complex financial transactions, usually for other companies or governments.
What does an investment bank do?
An investment bank helps companies raise money by issuing new stock and bonds, assists companies with mergers and acquisitions, acts as a broker for other companies, etc. Trading divisions of investment banks also buy and sell securities with an intention of making a profit for the investment bank itself, which is called proprietary trading.
Wow, that’s a lot of services!
Wait, there’s more. Research divisions of investment banks analyze the performance of companies and their stocks, and provide buy, sell or hold recommendations. Some investment banks also have a separate retail operation for individual customers like you and me.
Can you give me some examples of investment banks?
Some of the major investment banks are Goldman Sachs, Morgan Stanley, Citigroup, JPMorgan Chase, Credit Suisse, etc.
Podcast: What is an Investment Bank
Fun, informative and concise episodes by a 10-year old, breaking down complex financial concepts in a way that kids and beginners can understand. Episodes cover personal finance topics like saving, investing, banking, credit cards, insurance, real estate, mortgage, retirement planning, 401k, stocks, bonds, income tax, and more, and are in the form of a conversation between a cowboy (a finance novice) and his friend, a stock broker. Making finance your friend, only at Easy Peasy Finance.
A little bit about me: I have been fascinated with the world of personal finance since I was 6! I love to read personal finance books, and keep myself updated on the latest by reading various personal finance magazines. My friends often ask me questions about finance because they find it complex and intimidating. That’s what inspired me to start my YouTube channel called Easy Peasy Finance when I was 8, and this podcast 2 years later.
Everything you need to know about investment banks: What are Investment Banks, What does an investment bank do, Examples of investment banks, and more.
Show notes and transcript at: https://www.easypeasyfinance.com/what-is-an-investment-bank/