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    Investment banks and investment houses both play roles in finance and investing, though they have some differences. Investment banks primarily focus on providing services like underwriting new securities issues, M&A advisory, securities trading, and asset management to corporations and institutional investors. Investment houses refer more broadly to financial institutions that manage and invest funds on behalf of clients, including investment advice, asset management, and wealth management for high-net-worth individuals. While terms are sometimes used interchangeably, investment banks specialize in capital raising and advisory services, while investment houses manage a wider range of financial services and asset classes.

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    Investment banks and investment houses both play roles in finance and investing, though they have some differences. Investment banks primarily focus on providing services like underwriting new securities issues, M&A advisory, securities trading, and asset management to corporations and institutional investors. Investment houses refer more broadly to financial institutions that manage and invest funds on behalf of clients, including investment advice, asset management, and wealth management for high-net-worth individuals. While terms are sometimes used interchangeably, investment banks specialize in capital raising and advisory services, while investment houses manage a wider range of financial services and asset classes.

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    13 views2 pages

    AE 18 Report

    Uploaded by

    Mycka Joy Hernandez
    Investment banks and investment houses both play roles in finance and investing, though they have some differences. Investment banks primarily focus on providing services like underwriting new securities issues, M&A advisory, securities trading, and asset management to corporations and institutional investors. Investment houses refer more broadly to financial institutions that manage and invest funds on behalf of clients, including investment advice, asset management, and wealth management for high-net-worth individuals. While terms are sometimes used interchangeably, investment banks specialize in capital raising and advisory services, while investment houses manage a wider range of financial services and asset classes.

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    An investment house and an investment bank are financial institutions that play key roles in the world of finance,

    investment, and capital markets. While the terms are sometimes used interchangeably.

    Investment Bank: Investment House:


    Primary Functions: Investment banks primarily Primary Functions: The term "investment
    focus on providing a range of house" is broader and less
    financial services to specific compared to an
    corporations, governments, investment bank. It can
    and institutional investors. refer to various financial
    These services include institutions, including
    underwriting, mergers and investment banks, asset
    acquisitions (M&A) advisory, management firms, and
    securities trading, and asset other entities involved in
    management managing and investing
    funds.
    Underwriting: Investment banks assist Asset Management: Investment houses often
    companies in issuing new manage funds, portfolios,
    securities (stocks or bonds) and assets on behalf of
    to raise capital. They individuals, institutions, or
    underwrite these securities, even pension funds. They
    meaning they commit to make investment decisions
    buying the entire issue at a to achieve returns for their
    predetermined price and clients.
    then sell them to investors in
    the market.

    Mergers and Acquisitions Investment banks advise Wealth Management: Some investment houses
    (M&A): companies on buying or focus on providing
    selling other companies. comprehensive financial
    They assist in negotiations, services to high-net-worth
    valuation, and structuring individuals, including
    deals. investment advice, estate
    planning, and financial
    planning.
    Trading and Sales Investment banks engage in Mutual Funds and Investment houses may
    buying and selling financial Hedge Funds operate or sponsor mutual
    instruments on behalf of funds and hedge funds,
    clients and for their own pooling money from
    accounts. multiple investors to invest
    in a diversified portfolio of
    assets.
    Research: Investment banks often Private Equity: Some investment houses
    conduct financial research, engage in private equity
    analyzing markets, activities, investing in
    industries, and specific private companies and
    securities. This research is providing capital to support
    used to provide insights to their growth.
    clients and support trading
    decisions.
    Investment banking

    - It is a specific branch of banking that helps businesses raise funds and provides them with financial advice and
    support.
    - It provides substantial financial advising, capital raising, government and financial institution services, financial
    and risk management services, and help to enterprises.
    - An investment bank is a type of financial services firm that serves as a middleman in large and sophisticated
    financial transactions.
    - When a new firm is ready to launch its initial public offering (IPO) or when a company combines with a rival, an
    investment bank is approached.
    - For large institutional clients like pension funds, it also serves as a broker or financial advisor.

    Investment bank Do

    - Example: Company ABC wants to merge with another company. How will it know that the other company will
    benefit from it? Or how is it going to raise the desired funds? And who is going to handle the complete
    documentation and help in figuring out new investment plans?
    - Well, the short answer to all these questions is an investment bank.
    - Investment banks play a vital role in in making a company go big by acting as a risk taker or say, middleman.
    - Investment banking focuses on two main areas:
    1. M&A (Merger and Acquisition) Advisory – it is the process of assisting corporations and institutions in the
    location, evaluating and completing company acquisitions.
    2. Underwriting – is a procedure used by banks to get funds from investors for a client mostly in the form of
    equity or debt securities.

    Investment bank work

    - Investment banks are divided into two types :


    1. Sell – the sell side shares of newly issued IPOs, provides market-making services, places new bond issues,
    and assists customers with transactions.
    2. Buy – trade securities such as shares and bonds in order to maximize profits. Its collaborates with hedge
    funds, mutual funds and pension funds.
    -

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