Brainteaser Question: A hallway has 100 light bulbs numbered 1 to 100 with 100 corresponding light switches. 100 people walk through the hallway. The first person switches on every light bulb. The second person flips the switch of every second light bulb. The third person flips the switch of every third light bulb. The fourth person, every fourth and so forth until all 100 people pass through the hallway. How many light bulbs are switched on at the end?

Brainteaser Answer: 10 light bulbs

Players of the Deal September 23, 2014

Pitch of the Week Ebay Pitch

Portfolio Applications Extended New deadline: This Thursday at midnight (9/25/14) Application link:

Players of the Deal Corporate Finance Investment Bankers Sales & Traders Hedge Funds & Asset Managers Research

Corporate Finance Main duties: Managing and allocating capital – Short term cash management – Long term investments and projects Financial reporting – Public company reporting – Internal auditing In-house M&A and valuation Financial Planning & Analysis Treasury Cash Management Corporate Development Finance Departments

Investment Bankers Industrials Consumer & Retail Tech, Media, Telecomm (TMT) Real Estate Financial Institutions (FIG) Healthcare Energy & Power Mergers & Acquisitions Restructuring Leveraged Finance Capital Markets – Debt Capital Markets (DCM) – Equity Capital Markets (ECM) Types of Investment Bankers Coverage Product

Investment Bankers Advisory: – Give advice on how to best structure the deal – Help companies through the different processes of deals Road shows, regulatory requirements, etc. Valuation: – Use to help gauge the price of a company – Third-party fairness valuations of companies Underwriting: – Help companies raise capital by first taking it onto the bank’s balance sheet before selling to institutional investors So what do they do?

Sales & Traders Clients Sales Traders Structurers Research Analysts Risk Management Players in the Secondary Market Investor Investment Bank Corporation $$$

Sales & Traders Now that the investor has the bonds what does he do? What else can you trade? Bonds, CDS, Futures, Options, Interest Rates, FX & Forwards The secondary market provides liquidity Investor Investment Bank 1.Buy more bonds 2.Sell bonds 3.Swap bonds for other bonds

Sales & Traders Investment Bank FICC TradingG7Interest RatesFX & Forwards Emerging Markets Interest RatesFX & ForwardsSPG Trading MBS (Agency & Non Agency) ABSCDO’sEquitiesCash TradingDerivativesCredit Investment Grade High Yield Product Structure

Sales & Traders Client-facing business: – You are the competitive edge that differentiates you from your competitors – This means getting the best price for your existing clients, and winning business from competitors – It is your job to satisfy your firm’s clients, this includes: Road shows, dinners, conferences, golfing & sports Assisting the Traders: – Help traders get out of “Axed” positions – Help facilitate flow when markets are stable Salespeople: So what do they do?

Sales & Traders Business of Risk Management: – Take a position on behalf of the firm to facilitate client flow – Job is to make money off of bid/ask spreads – Building up inventory and getting lucky is not a successful tactic in this business Qualities of Traders: – Analytical, quick, high risk appetite – Deep insight into the markets they trade; know who your clients are, what they’re buying, and what they’re selling. Traders: So what do they do?

Sales & Traders Structurers: – Client business that requires intense problem solving – Tailor make a solution for a specific problem Risk Management: – Stress-test across different parameters to make sure the firm never breaches its risk limits Research: – Produce sell-side reports that explain changes in the markets – Usually split by product and can require econometrics, valuation analysis, or statistical and mathematical modeling Front Office – other roles

Hedge Funds & Asset Managers Various types of Hedge Funds – Multi-Strat – Long-Short – Managed Futures – Merger Arbitrage

A Roadshow Investment Banker IPO Company e.g. Alibaba IPO Company e.g. Alibaba Hedge Fund / Asset Manager Private Equity Venture Capital

Why do you need them? Money Pricing Marketing – (Imagine if Buffett invested in your company)

Research Sell-Side Analyst Cover a specific sector / industry Create financial models and research reports Interact with corporate executives Introduce buy-side analysts to corporate executives