Investment Banking ------ An overview

Investment Banking refers to financial consultancy and their main revenue generation operates through cash market dealing with securities as well as primary market dealing with bonds. In fact, they provide legal advisory services for mergers and acquisitions. According to SEC (FINRA) regulations such an advisor (individual or a financial institution ) should be a licensed broker or an authorized dealer.

First world countries primarily the G7 nations having strong economic platform, banking sector had never delineated investment banking as a separate domain. Strategic financial advisor and services often include trading of derivatives (futures and options), equities and commodity market trading. Their financial planning services included mergers and acquisitions of institutional houses and thus acted as a perfect third-party consultant.

Their revenue generation has always been bilateral. Research, promotion, marketing dominated largely in securities and cash market trading. On the other hand, dealing with various funds, which categorically include pension funds, hedge funds, mutual funds, insurances of various categories by utilizing their retail database, which actually generated their revenue from their respective clients through the “buy side”.

The last two of the” bulge bracket” firms that existed on Wall Street were Morgan Stanley and Goldman Sachs. However, on the 22^nd of September,2008 they responded to the U.S financial crisis by electing to convert into traditional banking institutions. There are banks that are “universal” rather than specifically being bulge market investment banks as they accept deposits. These are Citigroup, Deutsche Bank, UBS AG , JP Morgan Chase , Credit Suisse , HSBC and Barclays.

Cut off your Credit Card debts

A minimal effort can indeed save thousands of dollars every year . Credit card costs can be cut down also more cutting down of expenses means making more money. Certain measures that could be undertaken are:-

An interest exceeding 12% should be counted as excessive charging by the credit card company. The normal prime interest rates being less than 10% any credit card company who charges more than so are befooling you. If you carry a good credit then its best to find a good credit card having interest rates varying from 9 to 12 % avoiding those credit cards which charge 13 to 21% interest.
This can save about USD 450 to 1K a year.

A credit card having lower interest rate enables you to clear off the debts on other existing credit cards by cash withdrawals. Thus , the debt automatically moves on to a credit card having a lower interest rates. However , it should be noted that there are credit cards that charge a higher transfer fee to move a debt from one credit card to another. So it should be appropriately chosen.
This ensures a yearly savings of USD 200 to 500 a year.

A part of the savings should be used to clear off consumer debts. With credit cards charging interest at 10 to 21 % and a consequent less 1% interest offered by banks on passbook savings , it is advisable to clear off as many debts as possible through the savings accounts . However, it would be risky to empty the savings and be unprepared for emergencies. So an enough amount is to be kept along with a good borrower status.
This can provide a yearly savings of USD 200 to 500

If a person does not have enough savings to clear off his consumer debts then an alternative and viable option is home equity loan. As, home equity loans carry much lower interest rates than credit cards so it acts as a benefit in two ways:
1. The interest rates that you pay on your credit card at around 16% comes down to flat 6 or 7 % in case of the home equity loan.
2. the interest of the home equity loan can be deducted from a person’s taxable income.
However, it should be noted that it puts your house on the line so manage your funds very carefully.
It is possible to get a yearly savings of USD 1000 to 2000.

Look out for credit cards that come with no annual fees , considering other options as late payment fines, grace period ,interest rates and so on , choose your card. The cards that carry a fixed annual fee can also be made free by calling the concerned bank and asking them to waive off the fee.
It saves around USD 25 to 50 a year.

Always try to pay down the credit balance in order to cut down on the interest rates.
This can potentially save USD 100 to 1000 a year.

If there exists a balance on more than one credit cards then strategize your payments. Follow a Credit Crunch as follows :-
If card A charges maximum interest then pay the bulk of your savings towards card A while paying much lesser amounts to the others. Once card A is cleared then subsequently follow the same payment procedure for the card that charges the second highest interest rate after card A and so on.