Investment banking is a scenario whereby a private company offers various financial services to governments, corporations, and individual persons. It acts as an agent of setting prices and capital formation. The financial services rendered include mergers and acquisitions, equity research, sales, raising capital, retail & commercial banking, and security underwriting.
In Mergers and Acquisitions (M&A), an investment bank advises prospective sellers, which is called sell-side engagement. On the other hand, when it takes the advisory role to the buyer, it is called buy-side assignment. The advice given to buyers and sellers is on negotiation, business evaluation, pricing, procedure, transactions, and implementation. An investment bank assists companies to raise capital and security underwriting. For instance, if a company wants to give new securities to the buyers, investment banks act as intermediaries between them.
Regarding Sales & Trading and Equity Research, the banks connect buyers and sellers in addition to marketing securities, thus delivering prices and liquidity to investors. For facilitation of trading securities purposes, banks also buy and sell securities out of their own account. Institutional investors like mutual funds, pension funds, hedge funds, and university endowment are known to use investment banks for trading securities. The investment banks will then charge commission fees for the services rendered.
If there is an expert in investment banking, it could be none other than Martin Lustgarten. In the recent past, he has made great fortunes by coordinating imports and sales from various countries like France, Venezuela, and Singapore. In Venezuela, the situation was rife, whereby the dollars were few, and the government had some difficulty in tackling the issue. Martin Lustgarten approached the banks of Venezuela and struck a deal with them. He offered to sell them dollars at a little bit hiked prices. The deal saw Martin make a fortune amidst tough economic times.
His dual citizenship of Australia and Venezuela has made his investment even more successful. He is an international financier that has provided money and loans to companies in Venezuela. He is the best role model for investors as he has worked in many countries like South Africa, America, Australia, and Venezuela.