Technical interview guide. Preparation for Finance Interviews

Fourth edition. — WallStreetOasis.com Internet Edition, 2013. — 245 p.Technical questions are part of nearly every finance interview.
While the level of difficulty of these questions varies from firm to firm, from interviewer to interviewer, and from candidate to candidate, every applicant will be grilled on technical questions in at least one round of interviews.This Guide is offered a compilation of the most common technical questions from finance interviews in a variety of fields.
Obviously, you will not encounter every question from this Guide. Likewise, your interview may include variationson the questions included here or even questions that are altogether new. If you have studied this Guide, however, you will be prepared to field any of your interviewer’s questions with confidence.The material in this Guide is Organized into the following topics:Current Events, Accounting/
Finance/Valuation, Stocks, Bonds/Loans/Interest Rates, Currencies, Options& Derivatives, and Mergers &Acquisitions.These concepts are
further arranged according to basic, intermediate, and advanced levels of difficulty. The more common questionsappear in bold faceprint. Obviously, you should focus your attention on those, as well as on the sections relevant to your specific job interview.
If you are preparing for a Sales and Trading interview, for example, you should focus on Stocks, Bonds/Loans/Interest Rates, Currencies, and Options & Derivatives. For Investment Banking positions,you should have a general background in all thosecategories, but you are most likely to encounter questions from the Accounting/Finance/Valuation and Mergers & Acquisitions sections.
(Youshould always be prepared for the behavioral aspects of your interview, covered in the WSO Behavioral Interview Guide.) The final
section of this Guide is Brainteasers.The purpose of a brainteaser during an interview is to see how you react under pressure. The purpose of this section of the guide is to give you some insight into what your thought process should look like.
More important than actually solving the brain teaser is being able to organize your thoughts and deliver a reasonable response.
The interviewer wants to observe your analytical aptitude, your capability to handle somestress, and your ability to think on your feet. You will soon Realize that interviews are similar to a game. Your interviewer will likely push you to see how far you can go until you don’t know an answer.That’s a good thing.
Even with a 4.0 in a finance and economics double major from Wharton, you still know little compared to the interviewer across the table.
When studying these questions, keep in mind that you cannot prepare for everything your interviewers may ask. They will always be coming up with new questions and new twists on standard questions,so it is important that you understand the theory behind the answers, rather than just memorizing them.
The explanations in the Guide are intentionally brief; when there is a question that you do not understand,do some research and develop a deeper understanding. The message boards At Wall Street Oasis are a great place to get expert advice and insight from Wall Street insiders. Use the search function! With over a million posts to date, your question has probably been asked before, and an answer is in our archives. Look for advice from “starred” users who have been Certified as experienced finance professionals who consistently give sound advice.