How Investment Banks Actually Make Money
Ever wondered how investment banks actually make money? In this video, we break down the business model of investment banks in simple terms and explain how firms like Goldman Sachs, Morgan Stanley, and JPMorgan generate billions of dollars every year.
You'll learn how investment banks earn revenue through IPOs, mergers and acquisitions (M&A), underwriting, trading, asset management, and advisory services. We'll also explain what investment banks actually do, how they differ from commercial banks, and why companies are willing to pay them millions in fees.
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0:01 Intro
0:53 Volcker Rule
1:27 M&A Advisory
2:48 Underwriting
3:40 Spacex's IPO Example
4:08 Trading & Market Making
5:04 Asset & Wealth Management
6:30 Are Investment Banks Overpaid?
6:42 Relationships
6:57 Distribution
7:12 Balance Sheet
7:25 Trust
8:10 Commercial Bank
8:23 Hedge Fund
8:37 Investment Bank
9:00 Outro
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