The financial services industry encompasses a broad range of service sector firms that provide finance management, including credit unions, credit-card companies and banks. It also includes investment firms, such as hedge funds and brokerages, as well as insurance agencies, private equity companies and diversified financial services companies. Its clients include large and small businesses, as well as individuals and governments.
The industry’s main components are banking, securities and investments, insurance, and consumer and corporate financing. Each of these sub-industries has its own unique functions, products and customers. For example, bank services may include depositing and lending money, while security trading is focused on buying and selling shares in publicly traded companies. Other types of financial services include investing, which involves making risky investments in stocks, bonds, or commodities. Investments are made by private investors and funds, as well as by corporations.
One of the most important segments of financial services is wealth management, which aims to help people manage their finances and invest in assets. This is accomplished by providing financial advice and planning, asset management, and wealth protection. Wealth managers often have significant knowledge of a wide variety of markets and assets, such as real estate, stocks, and commodities. They are also knowledgeable about a variety of investment strategies and methodologies, including tax strategies.
Another important segment of financial services is investor relations, which provides research and information about a company to institutional investors and the media. This is especially important for publicly-traded companies, as it can significantly impact a stock’s price and value. Investor relations professionals are also responsible for educating the public about a company’s business strategy, growth prospects, and current financial performance.
Lastly, corporate financing is the process of funding and growing a business. This can involve obtaining debt or equity capital, creating business plans, and taking action to increase the company’s value for shareholders. The industry is rapidly changing with the proliferation of digital technology and millennial consumers demanding more from their banks. It is also facing new challenges from fintechs and challenger banks that offer more streamlined services and are less regulated.
While working in the financial services industry can be highly rewarding, it can be a challenging career to break into. As with any industry, the key to success is having a strong network and getting an entry-level job where you can learn and develop your skills on the job. However, Duitch warns that not all entry-level jobs in the industry are created equal and that not all pave the way to becoming an investment banker or a hedge fund manager.
The finance industry plays a critical role in NYC and the world, and there are many exciting opportunities to work in this field. Whether you’re interested in working for an established bank, a tech startup, or an insurance agency, there’s an opportunity for everyone to find the right fit in this diverse and exciting industry.