Investment bankers

[settlement12]

I'm a big buy and hold fan and don't believe in trying to outperform the market.

Since it's very hard to beat the market, how do investment bankers get so rich? I understand they charge fees etc, but why are people willing to pay? Is it simply that they just dont understand that they are essentially being scammed?

[alex_686]

Define “Investment Bankers”. Most of those are doing the things you might think. They help issue new bonds, sometimes stocks, and tend to buy and sell who companies in mergers.

Maybe you are thinking portfolio managers. One of the reasons why passive indexing works is because the market is efficient. The reason why the market is efficient is because portfolio managers are squeezing as hard as they could.

It is a little like explaining to a high schooler why they won’t make big bucks in the NFL. Maybe they can, but it is a high skill high effort occupation.

[TheTimeLord]

https://www.investopedia.com/articles/p ... lly-do.asp

[chinchin]

By providing liquidity or facilitating transactions that would otherwise be cumbersome or more costly.

https://www.investopedia.com/articles/m ... -pools.asp

[chassis]

how do investment bankers get so rich?

By skillfully and in large quantities selling companies on behalf of their clients. Work fee + success fee = big money.

[inverter]

Investment bankers help ensure high quality and safe transactions for businesses with the public market. They are typically not buying/selling securities, trying to beat the market, etc.

You might be thinking of traders or financial advisors.

To answer your question, I heard a podcast that said imagine a grid of interesting to boring, mistakes to matter to 100% accuracy needed. Investment banking is boring work with 100% accuracy needed, translating to a high paycheck.

[LadyGeek]

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