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50 interview questions for IB role

Preparing for Investment Banking interview? Here are the top 50 technical interview questions to prepare for role in Investment bank.<br>

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50 interview questions for IB role

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  1. 50 IB interview questions Fmi.online • Part of the MDA Training Group

  2. 50 technical interview questions to prepare for role in Investment bank Accounting and valuation questions: 1. How are the three financial statement linked to each other? 2. What is the best way to analyse the cash management of a company? 3. Which form of capital is cheaper - Debt or Equity? Why? 4. What would ideally be included in cost of sales of a retail company? 5. Which items from balance sheet are included to calculate net debt? 6. Which items from balance sheet are included in cash and cash equivalents? 7. What impact does change in sales and inventory levels have on working capital? 8. What is horizontal and vertical ratio analyses? 9. Which ratios helps to determine the debt levels and repayment ability of a company? 10. Which are various company valuation methods? 11. What makes a good financial model? 12. What are the components of WACC and how do you calculate WACC? 13. What is difference between Equity value and Enterprise value of a company? 14. Why is EBITDA used to compare a company’s performance instead of EBIT? 15. State the relevance of industry P/E ratio in company valuation. 16. What might cause a company’s Present Value (PV) to increase or decrease? 17. What are some of the ways through which management analysis its working capital requirement? 18. What happens to Earnings Per Share (EPS) if a company decides to issue debt to buy back shares? 19. List the criteria you would consider for comparable company analysis. 20. What does it mean if a company’s Free Cash Flow is growing and how will this impact its valuation? Capital markets questions: 1. Who are the participants in capital market and what are their roles? 2. When should a company consider issuing debt instead of equity? 3. What is the role of broker/dealer in financial market? 4. What is the difference between vanilla and structured products in markets? 5. Which are some of the most known options valuation methods? 50 IB interview questions Fmi.online • Part of the MDA Training Group

  3. Capital markets questions (cont’d): 7. What is the role of credit rating agencies in the market? Name some of them. 8. What are the types of risk that exist in market and how do investment banks manage their risk? 9. What are custodians and explain their importance? 10. What are overnight rates? Name few. Questions on maths for finance: 1. Why is the concept of time value of money important? 2. What is DCF? 3. What is amortization of loan? 4. Explain the concept of annuity factor and its application in finance. 5. What is the impact of compounding on returns? 6. How are IRR and NPV related? 7. How do you adjust for semi-annual coupon payment while calculating bonds? 8. Which methods is used to quantify stock volatility? 9. What is stock beta? How is it calculated? 10. Explain the application of probability in risk analysis. Investment banking questions: 1. How does liquidity in secondary market effect volumes in primary market? 2. What are the services a Lead manager provides in a IPO? 3. What are the different types of takeover? 4. Tell me about a recent successful merger/acquisition deal you read about. What was the price paid for the target? Why did the acquiring company decide to buy at that price? 5. What are the different sources of acquisition financing? Can you give an example from a recent deal? 6. What is a target valuation? 7. In an acquisition why do goodwill & other intangibles get created? 8. What is vertical and horizontal merger? 9. What factors can lead to the dilution of EPS in an acquisition? 10. Explain the concept of synergies in mergers using some examples. 50 IB interview questions Fmi.online • Part of the MDA Training Group

  4. FMI.online cover’s all these topics comprehensively in below mentioned courses: Equities Fixed income • • Investment Banking pathway • Asset management pathway • Derivatives • Global market pathway • Currencies • Financial analysis • Maths for Finance • 50 IB interview questions Fmi.online • Part of the MDA Training Group

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