However, if you are pressed for time, you can't read everything. What should you focus your efforts on to get the maximum output under constraints? How technical should you expect the questions to be?
If you have finance experience or come from a lower ranked university, there are good chances that you NEED to show technical experience. For instance, a friend from home applied for an bulge bracket investment banking internship. Eric attended U-Texas and was in the undergrad business program. He worked in an equity research position at a middle market firm his sophomore summer. When Eric was interviewing at the bulge bracket for his junior summer, his interviewer was a banker in debt capital markets (DCM). Even though Eric had no direct experience with debt financing and LBOs (he covered consumer stocks in his previous internships), Eric received the following technical questions:
- Talk about the debt markets.
- What is the fed funds rate? (Note: applicants to IBD may receive traditional sales and trading questions)
- Gap is a hot stock now. How is their debt structure? How much cash do they have? Does Gap have enough financing if they fall short of their annual revenues? Under what conditions will Gap need to refinance? (Note: The interviewer saw that Eric covered consumers as a research intern. The interviewer randomly picked a consumer stock that was in the news, and asked Eric debt questions that not only relate to Eric's research experience but also have direct relevance to the interviewer's backgound in DCM)
- What consumer stocks would you recommend? (Note: The interviewer probably knows about the general trend in consumers. He is testing whether Eric can talk about the stocks he researched the prior summer - a person truly interested in finance would have kept up with current news on the companies.)
If you come from a leading university and with NO finance experience, the questions will be more about your background and why you are interested in the position / the bank. If you have an economics or related finance experience, be prepared to answer any and all questions about any economics-related topics. In a bulge bracket IBD position, I was asked about a theory in one of my macroeconomics classes! If you don't have any direct experience with finance (nothing at all, not even as a personal trader or with your school investment club) and wrote a winning finance resume, you will still need to prove some knowledge of both the position and the work you will do as an intern. How do you prepare for this?
Read the Wall Street Journal, the NYTimes Dealbook, and be ready to talk about major current issues. A bulge bracket banker once told me that if you can explain current economic debates and your take on them with intelligent insights (give your opinion and back it up with evidence), you can go really far in the interviews (assuming that interviewers agree with your opinions or see that you have done your homework). Bankers don't have all the time in the day to read everything about the markets and the entire financial landscape, so if you can say something that is illuminating, it sticks with the interviewers. You will come off as intelligent, well-read, and truly interested in finance. Interviewers don't remember people because of their GPAs, schools, or sometimes even finance experience - they remember you because of the mental horsepower you demonstrate.