Morgan Stanley interview questions

A standard three-statement variation once you've handled depreciation.

A company repurchases $100 of its own stock using cash on hand. Walk me through the three statements. Then tell me what changes if it funds the buyback with debt at a 5% interest rate.

The opening exercise in most modelling tests. Speed and accuracy on the basics.

Build a three-year operating forecast from the assumptions provided. Revenue grows at the stated rate each year. EBITDA and D&A are percentages of that year's revenue. Compute EBIT, then tax the…

Asked in essentially every investment banking interview. Expect follow-ups immediately.

Explain the difference between enterprise value and equity value. Why do we use each, and how do you get from one to the other?

The single most commonly asked question in investment banking analyst interviews.

Explain how the income statement, balance sheet and cash flow statement connect. Assume the interviewer wants the full linkage, not just a description of each statement in isolation.

Expect to be asked to compute this with numbers on a whiteboard.

Walk me through calculating WACC. Where does each input come from, and why do we use a target capital structure rather than the current one?

The grunt work behind every comps page, and interviewers check you know why it exists.

You're building a comps set. One company has a June fiscal year end, another December. How do you handle it, and how do you calculate LTM EBITDA?

Tests whether you can think like an advisor rather than a modeler.

An acquirer can fund a deal with cash, new debt, or stock. Compare the three from both the buyer's and the seller's perspective, and explain what signal each sends to the market.

Sector-specific multiple knowledge is what distinguishes prepared candidates.

Which multiple would you use to value: (a) a software company, (b) an airline, (c) a bank, (d) a REIT, (e) an early-stage biotech? Justify each.

The analysis that determines the ownership split in a stock-for-stock merger.

Two companies are merging in an all-stock deal with no premium. How do you determine the ownership split, and what is contribution analysis?

Increasingly common given how many deals involve software and subscription businesses.

A SaaS company collects $120 cash upfront for a 12-month contract on January 1st. Walk me through the accounting at collection and at the end of month one. Why do investors watch deferred revenue?

You will be asked to compute this by hand, without a calculator.

A company has 10 million basic shares trading at $50. It has 1 million options with a $20 strike. Calculate diluted shares and equity value using the treasury stock method.

Relevant given the volume of separation activity across large caps.

Compare a sale, a spin-off and a carve-out IPO as ways to separate a business unit. When would you recommend each, and what makes carve-outs operationally hard?

A WACC follow-up where candidates reach for the wrong number.

How do you estimate the cost of debt for a WACC? Why not just use the interest expense divided by total debt?

Tests whether you understand that balance sheet movements alone don't touch the income statement.

A company buys $10 of additional inventory, funded entirely with debt. Walk me through the three statements immediately after the purchase, and then tell me what happens when the inventory is…

Tests whether you can handle a non-cash charge that isn't depreciation.

A company writes down $100 of obsolete inventory. Walk me through the three statements at a 25% tax rate.

A live debate in tech coverage and growth equity. Interviewers want a view, not a recital.

Stock-based compensation is added back as a non-cash expense in most adjusted EBITDA calculations. Do you think that's the right treatment? Defend your position.

Expect this as a rapid mental-math question with no calculator.

Company A trades at 20x P/E and acquires Company B at 15x P/E in an all-stock deal, with no synergies. Is the deal accretive or dilutive? Explain the rule and its limits.

A standard DCF follow-up that separates builders from reciters.

What is the mid-year convention, why is it used, and roughly how much does it change a valuation?

Interviewers use this to check whether you know which cash flow belongs in which analysis.

Define unlevered free cash flow, levered free cash flow and free cash flow to the firm as reported by companies. When is each used, and why do the definitions disagree?

Top-three most asked question in investment banking interviews.

Walk me through a discounted cash flow analysis from start to finish.

Tests judgement about tool selection rather than mechanics.

Name situations where a DCF is the wrong tool, and explain what you would use instead in each case.

Follows the WACC question when the interviewer wants to go deeper.

What does beta measure? Walk me through unlevering and relevering beta and explain why the process is necessary.

Separates candidates who understand the enterprise value bridge from those who memorised it.

A company owns 70% of Subsidiary A and 30% of Company B. How does each appear in the financials, and what does that mean for enterprise value?

Essential for FIG groups; also a common curveball in generalist interviews.

Why can't you value a bank with a standard DCF and EV/EBITDA? Walk me through how you would value one instead.

An M&A associate review exercise built around finding linked errors rather than building from a blank page.

A first-year analyst sends you a merger model and draft client page forty minutes before the internal review. Find every issue that can change the recommendation, decide what must be fixed first, and…

Asked in cross-border M&A and emerging markets coverage.

How do you adjust a DCF for a company operating in an emerging market? Where does the country risk go?

Technology coverage analysts regularly reconcile operating KPIs to reported growth before discussing a software issuer with investors.

A SaaS company begins the year with $100m of ARR. Existing customers expand by $12m, contraction is $4m, churn is $6m, and new customers add $18m. Calculate ending ARR, net revenue retention, gross…

Cybersecurity is a critical and growing sector. This tests understanding of the business model.

What are the common business models in cybersecurity, and how do they differ from traditional software?

Software business models are the foundation of tech coverage. This tests understanding of SaaS vs perpetual.

Explain the differences between SaaS and perpetual licensing business models. How do revenue recognition, economics, and valuation differ?

Gross margins are critical in software. This tests understanding of cost structure.

What drives gross margins in software companies, and what does margin compression indicate about the business?

The Rule of 40 is the core software valuation framework. This tests understanding of growth vs profitability.

Explain the Rule of 40 for software companies. How is it calculated, and what does it tell you about the company's balance of growth and profitability?

Cloud computing has transformed IT economics. This tests understanding of the shift to cloud.

What are the economics of cloud computing, and how does the shift from on-premise to cloud affect software companies and their customers?

Network effects are the strongest moat in technology. This tests understanding of competitive dynamics.

Explain how network effects work in technology businesses, and what determines whether they create sustainable competitive advantages?

Open source has disrupted software business models. This tests understanding of monetization.

What are the common business models for open source software companies, and how do they differ from traditional proprietary software?

Churn is the killer of SaaS economics. This tests understanding of customer retention.

What are the key churn metrics for software companies, and what do they tell you about product quality and competitive position?

CAC analysis determines unit economics. This tests understanding of go-to-market efficiency.

What are the key metrics for analyzing customer acquisition in software companies, and how do you assess whether acquisition economics are sustainable?

Embedded finance is transforming fintech. This tests understanding of the integration model.

What is embedded finance, and how do embedded finance companies make money? How does this differ from traditional financial services?

APIs have become a core business model. This tests understanding of platform economics.

What are the business models for API-first companies, and how do they differ from traditional software models?

The core technical in any technology coverage interview.

How do you value a software company, and why doesn't the standard EV/EBITDA framework work well for one that's growing 40% a year?

AI is transforming technology. This tests understanding of the new business models.

What are the business models for AI companies, and how do they differ from traditional software economics?

Semiconductors are highly cyclical. This tests understanding of the chip industry dynamics.

What drives semiconductor cycles, and how do you assess where we are in the cycle? How does this affect valuation?

The purchase accounting quirk that distorts every software acquisition's first year.

A software company with $200m of deferred revenue is acquired. Why does the acquirer's reported revenue come in below expectations in year one?

A senior coverage interviewer uses this scenario to test whether you can turn customer concentration and AI economics into a defensible valuation recommendation.

An AI-infrastructure vendor has $80m of ARR, 60% growth and an 85% gross margin. Its largest customer supplies 45% of ARR under a one-year contract, and that customer is building a competing internal…

Technology coverage interviewers use this to test whether a candidate can turn a bookings headline into a defensible revenue forecast.

A SaaS company reports 30% growth in total RPO, but only 12% growth in current RPO. Billings are flat, reported ARR grows 18%, and management points to several large three-year contracts signed late…

The foundational asset management question. Fee-based business models are different from banking.

Explain the asset management business model. How do they generate revenue, and what are the key drivers of profitability?

The foundational FIG question. Every banking interview starts with the business model.

Walk me through how a commercial bank generates profit. What are the main revenue streams and cost drivers?

Fintech is disrupting FIG. This tests understanding of the competitive landscape.

What are the key differences between fintech companies and traditional banks? How do their business models and economics compare?

Insurance is a cyclical business. This tests whether you understand the industry dynamics.

Explain the insurance underwriting cycle. Why do insurance margins fluctuate so much, and what drives the cycle?

Asset management M&A is driven by scale and distribution. This tests understanding of industry dynamics.

What are the key considerations when acquiring an asset manager? How do you value a business that's essentially people and reputation?

CECL/IFRS 9 changed how banks reserve for losses. This tests understanding of current accounting.

Explain how banks calculate loan loss provisions under CECL. How does this differ from the old incurred loss model, and why does it matter for earnings volatility?

The float is what makes insurance unique. This tests understanding of the investment side of the business.

Explain the insurance float and how insurers invest it. What are the constraints on investment strategy, and how does this affect profitability?

The core FIG valuation question. EV/EBITDA doesn't work for financials.

Why doesn't EV/EBITDA work for banks, and what metrics do you use instead?

Asset management valuation is different from banking. This tests understanding of fee-based models.

What metrics do you use to value an asset manager, and why is P/E more relevant than P/TBV?

Insurance valuation uses different metrics than banking. This tests sector-specific knowledge.

What metrics do you use to value an insurance company, and how do they differ from bank valuation metrics?

A FIG associate gives this as a short earnings-model check before asking for the credit-cycle implication.

A bank reports $2,400m of net interest income, $900m of fee income, $1,850m of non-interest expense, $420m of provision for credit losses, and $180m of tax expense. Calculate pre-provision net revenue…

Post-2008, capital ratios are the first thing FIG analysts discuss. This tests regulatory knowledge.

Explain the key capital ratios that banks must maintain under Basel III. Why do they matter for valuation?

A FIG superday case tests whether you can connect a bank's securities mark to its ability to pay for an acquisition.

A bank has $100bn of risk-weighted assets and $11bn of CET1 capital, so its CET1 ratio is 11.0%. It holds $20bn of available-for-sale securities with a $2bn unrealised loss in accumulated other…

Bank M&A has unique considerations. This tests sector-specific deal knowledge.

What are the key considerations when valuing a bank acquisition? How does it differ from valuing a non-financial company acquisition?

Rate sensitivity is the single most important factor for bank earnings. This tests quantitative understanding.

A bank has $100 billion in interest-earning assets with an average yield of 5% and $80 billion in interest-bearing liabilities with an average cost of 2%. What happens to net interest income if rates…

A FIG case uses reserve development to test whether you can distinguish a one-time accounting charge from a signal about underwriting quality and capital capacity.

A P&C insurer reports a 5-point adverse prior-year reserve development charge, taking its combined ratio from 96% to 101%. Management calls the charge isolated and maintains its buyback plan. How…

A FIG superday tests whether you can challenge a management presentation that reports strong AUM growth but weak underlying client demand.

An active asset manager reports AUM up 12% year over year, calls it evidence of strong demand, and is seeking a premium valuation. Your work shows market appreciation contributed 15%, net client flows…

FIG coverage interviews test whether you can value a business where debt is inventory.

Why do some banks trade above tangible book value and others below? Give me the relationship, and explain what a bank can actually do about it.

Restaurants have unique economics. This tests understanding of food service operations.

What are the key components of restaurant unit economics, and how do they differ from traditional retail?

Brand equity is the primary asset for consumer companies. This tests understanding of intangible value.

What framework do you use to assess brand equity, and how does it translate into financial performance?

Inventory management is critical to retail profitability. This tests operational analysis skills.

What metrics do you use to assess retail inventory management, and what do they tell you about the health of the business?

Unit economics determine retail profitability. This tests understanding of store-level performance.

What are the key components of retail unit economics, and how do you assess whether a store is generating adequate returns?

Food inflation significantly impacts consumer companies. This tests understanding of cost pass-through.

How do food price inflation affect different consumer companies, and what determines whether they can pass costs to consumers?

Consumer coverage teams use this to test whether a candidate can connect a shelf-price change to consumer value and reported revenue.

A beverage company replaces its 16-ounce bottle at $4.00 with a 14-ounce bottle at $4.20. Explain the price-pack change, calculate the change in price per ounce, and say what you would monitor before…

Consumer and retail coverage interviews open with the metric that defines the sector.

A retailer reports +5% same-store sales. Why isn't that enough information to know whether the business is healthy?

ESG is increasingly important to consumers and investors. This tests understanding of sustainability trends.

How do environmental, social, and governance factors affect consumer companies, and what are the material impacts on financial performance?

Consumer behavior drives demand. This tests understanding of demographic and psychographic trends.

What data sources and frameworks do you use to analyze consumer behavior trends, and how do you distinguish short-term fads from long-term shifts?

Consumer companies vary widely in economic sensitivity. This tests understanding of cyclical dynamics.

What factors determine how cyclical a consumer company is, and how do you adjust valuation for economic sensitivity?

Private label has disrupted traditional brands. This tests understanding of competitive dynamics.

How does private label competition affect branded consumer companies, and what determines which brands can defend their position?

Channel strategy is critical to retail success. This tests understanding of go-to-market dynamics.

What factors do you consider when evaluating a retailer's channel strategy, and how do e-commerce and omnichannel affect the analysis?

Digital transformation is reshaping retail. This tests understanding of technology disruption.

What are the key areas of digital transformation in retail, and how do they affect the competitive landscape?

Asked when covering multinationals, where FX moves can swamp operating performance.

A US company owns a European subsidiary. The euro weakens 10%. What happens to the consolidated financials?

Supply chain disruptions have become critical. This tests understanding of operational risk.

How do you assess supply chain resilience, and what are the key factors that determine whether a company can weather disruptions?

Consumer M&A has unique strategic drivers. This tests understanding of sector consolidation.

What are the primary strategic reasons for M&A in consumer and retail, and how do they differ across subsectors?

A senior consumer coverage case for separating manufacturer revenue from underlying demand before advising on valuation or a transaction.

A beverage manufacturer reports shipments to distributors down 12% year over year. Distributor inventory fell from 10 weeks to 6 weeks, while retailer point-of-sale sales were flat. Management says…

Consumer coverage interviewers use this to test whether a candidate can look through a sales beat to the unit economics underneath it.

A branded food company reports 6% volume growth after increasing trade promotions. Net revenue grows 4%, gross margin falls 180 bps, and retailer inventory rises 9%. Management says the promotion is…

CROs are essential to pharma R&D. This tests understanding of the healthcare services ecosystem.

Explain the business model of a contract research organisation (CRO). How do they generate revenue, and what drives demand for their services?

Generics have different economics than branded pharma. This tests understanding of the value chain.

Explain the generic drug business model. How does it differ from branded pharmaceuticals, and what drives profitability?

Healthcare real estate is a growing asset class. This tests understanding of the property side of healthcare.

Explain the business model of a healthcare REIT. How do they generate revenue, and what are the key risks?

Healthcare services (hospitals, insurers, PBM) have different economics than medtech/pharma. This tests breadth.

Explain the business model of a hospital company. How do they generate revenue, and what are the key cost drivers?

Medical devices have different economics than pharma. This tests understanding of the subsector.

Explain the business model of a medical device company. How does it differ from pharmaceuticals, and what are the key value drivers?

Reimbursement determines whether healthcare products get paid for. Fundamental to understanding the sector.

Explain how reimbursement works for pharmaceuticals and medical devices. What are the key payers and how do they decide what to cover?

Healthcare coverage teams use this as a foundational test of how payment incentives can reshape an otherwise stable revenue pool.

What is a site-of-care shift in healthcare, and why can it matter to the revenue and valuation of providers, payers and medical-device companies?

The patent cliff is the single most important concept in pharma valuation. Every healthcare interview covers it.

Explain the patent cliff for pharmaceutical companies. Why does it matter, and how do companies manage the risk?

Managed care has unique economics. This tests understanding of the insurance side of healthcare.

Explain the business model of a health insurance company. How do they generate profit, and what are the key risk factors?

Digital health is a growing subsector with unique economics. This tests understanding of new business models.

Digital health companies (telehealth, health IT, digital therapeutics) have different economics than traditional healthcare. How do you value them, and what metrics matter?

Regulatory risk is omnipresent in healthcare. This tests understanding of the political/legal landscape.

What are the major sources of regulatory risk in healthcare, and how do they differ across subsectors? How do you model this risk in valuation?

Pricing power is the core pharma investment thesis. This tests understanding of the market dynamics.

What factors determine whether a pharmaceutical company can charge high prices for a drug? Why do some drugs have strong pricing power while others don't?

R&D productivity is the core pharma investment thesis. This tests understanding of industry challenges.

Pharma companies spend more on R&D but approve fewer drugs per dollar spent. Why is R&D productivity declining, and what are companies doing about it?

A sell-side healthcare process can test whether you know how a regulatory condition changes both price and deal certainty.

A biotech with one oncology drug is being sold after accelerated approval. The confirmatory trial reads out in 18 months, and the buyer wants to pay a headline price based on full approval. How would…

Healthcare coverage teams use this to test whether you can identify the recurring economics embedded in a capital-equipment franchise.

A surgical-robotics company grows procedure revenue 18%, capital-equipment revenue 2%, and its installed base 10%. Management argues that the slowing equipment line is positive because the business is…

Healthcare M&A has unique strategic drivers. This tests understanding of sector dynamics.

What are the primary strategic reasons for M&A in healthcare, and how do they differ across subsectors (pharma, medtech, services)?

A common first-round renewable-power follow-up after an analyst discusses project scale or revenue.

A solar project has 100 MW of nameplate capacity and a 30% capacity factor. Calculate its expected annual generation in MWh. Then explain why capacity factor is more useful than nameplate capacity…

The foundational E&P valuation question. Every upstream interview starts here.

Walk me through how you value an oil and gas company's reserves. What's the standard approach and what are the key drivers?

The core downstream question. Refining margins are what separates integrated majors from pure-play E&P.

Explain the refining crack spread. What drives refining margins and why are they so volatile?

Grid parity is the threshold where renewables compete without subsidies. Fundamental to understanding the energy transition.

Explain grid parity in renewable energy. When does it occur, and why doesn't it immediately drive fossil fuel displacement?

The renewables valuation foundation. Every power and clean energy interview uses LCOE.

Explain levelised cost of energy (LCOE). How is it calculated and why is it the standard metric for comparing different generation sources?

The foundational regulated utility question. Returns are set by regulators, not markets.

Explain how regulators determine the allowed return on equity for a utility. What factors go into the rate case, and how does this affect valuation?

MLPs were the dominant structure for midstream energy. Understanding them is still relevant for existing infrastructure.

Explain the master limited partnership structure. Why were midstream energy companies organised as MLPs, and what are the key considerations for valuation?

PPAs are the financing mechanism for renewables. Understanding them is essential for energy project finance.

Explain a power purchase agreement. How does it affect project economics and what are the key terms to negotiate?

OFS companies are highly cyclical. This tests whether you understand the sector dynamics.

Explain the relationship between oilfield services companies and E&P operators. How does the cycle work, and why are OFS margins so volatile?

LNG is a growing energy subsector with unique economics. This tests whether you understand the global gas market.

Explain how LNG pricing works and the economics of LNG transport. How does it differ from pipeline gas?

Every E&P valuation includes oil price sensitivity. This tests whether you understand the mechanics.

An E&P company has PV10 of $1 billion at $70/bbl oil. What happens to PV10 at $60/bbl and $80/bbl, and why is the relationship non-linear?

Tests whether you understand sector-specific valuation metrics versus generic multiples.

Why do E&P companies trade on PV10 rather than EV/EBITDA, and what does PV10 actually measure?

The strategic question facing every energy coverage group. The energy transition changes asset values.

How does the energy transition affect the valuation of traditional fossil fuel assets, and how do you model the risk?

A power and utilities associate may use this case to test whether a candidate can distinguish headline power prices from an asset's realised economics.

You are valuing a 200 MW merchant solar project. Its expected annual output is 350,400 MWh and the forecast average hub price is $50/MWh. Because solar generation is concentrated in low-price midday…

Energy M&A often involves asset swaps rather than corporate transactions. This tests sector-specific deal mechanics.

Two large E&P companies propose swapping assets in different basins to consolidate positions. How do you value the swap and ensure it's fair to both parties?

A common follow-up that separates valuation work from demand discovery.

How would an ECM bank set an indicative IPO price range for a company?

A first-round ECM question on identifying who receives the offering proceeds.

What is the difference between a primary and a secondary equity offering, and why does that distinction matter to investors?

The opening technical in any equity capital markets interview.

Walk me through the IPO process from the decision to go public through to the first day of trading.

A foundational question that tests whether you understand the client's strategic objective.

Why might a company choose to go public rather than remain private? What are the costs?

A classic IPO follow-up that tests whether you understand aftermarket stabilisation rather than just the term.

Explain how a greenshoe works in an IPO and how underwriters use it to stabilise aftermarket trading.

An ECM process simulation testing sequencing, dependencies and market-window judgement.

You are coordinating an IPO across the issuer, lawyers, auditors and syndicate. Put the work in executable order as diligence issues and a volatile market window threaten the launch.

An ECM analyst calculation testing whether you can translate an announced primary raise into shareholder dilution.

A company has 80 million shares outstanding. A founder owns 20 million shares and does not participate in a primary follow-on. The company raises $300m by issuing shares at $25. What is the founder's…

ECM teams use this judgement question to test how banking and sales coordinate before execution.

What is investor education before an IPO, and how is it different from the formal roadshow?

Tests whether you understand whose interests the pricing decision serves.

IPOs typically price below where they trade on day one, leaving money on the table for the issuer. Why does this persist, and whose interests does it serve?

The advisory conversation an ECM banker has with a client weekly.

A public company needs to raise $500m of equity. Compare a marketed follow-on, an overnight block trade, and a convertible bond. Which would you recommend and what determines it?

An ECM analyst simulation in which investor feedback and market volatility force a fresh launch recommendation.

You are staffing an IPO launch for a sponsor-backed industrial technology company. The syndicate desk needs a recommendation after early-look feedback, an earnings update and a sharp move in the…

An ECM process question on a confidential seller block after the stock has become volatile.

A major shareholder wants to sell a confidential block tonight. How would you manage wall-crossing, allocation and launch risk when demand may be thin?

An ECM analyst process case coordinating a marketed follow-on while disclosure and market conditions move.

You are the ECM analyst coordinating a marketed follow-on for a software issuer. The CFO wants to launch before an industry conference, but diligence and the market tape keep changing. Sequence each…

Tests client judgement on a large shareholder exit without disrupting the public market.

A financial sponsor owns 35% of a listed company and wants to reduce its stake. How would you advise on the exit?

Green bonds are a growing trend. This tests understanding of ESG in debt markets.

What are green bonds, and how do they differ from conventional bonds in terms of structure and pricing?

The yield curve is fundamental to bond pricing. This tests understanding of rate environment.

How does the yield curve affect bond pricing, and how do you determine the appropriate benchmark for a bond issuance?

An analyst-level arithmetic check used when preparing an issuance summary and sources-and-uses bridge.

A company issues $500 million face amount of 10-year notes at 99.25. Underwriting fees are 35 bps of face amount and legal, rating, and printing costs total $0.60 million. Calculate gross cash…

The foundational DCM question. Understanding the process is essential for the role.

Walk me through the process of a corporate bond issuance. What are the key steps and who are the key participants?

Digital bonds are an emerging trend. This tests understanding of blockchain in capital markets.

What are digital bonds, and how does the issuance process differ from traditional bond issuances?

Municipal bonds have unique tax treatment. This tests understanding of the muni market.

What are the key differences between municipal and corporate bonds, and how does tax treatment affect pricing?

Bond structuring is core to DCM. This tests understanding of debt terms and investor preferences.

What are the key decisions in structuring a bond issuance, and how do you balance issuer needs with investor preferences?

Syndication is how debt is distributed. This tests understanding of the sales process.

Explain the syndication process for a bond issuance. How do you determine the syndicate structure and allocate bonds?

High yield is a distinct market with different dynamics. This tests understanding of the segment.

What are the key differences between the high yield and investment grade bond markets, and how does this affect issuance strategy?

Credit spreads are the core pricing metric. This tests understanding of credit risk.

What factors determine credit spreads for corporate bonds, and how do you assess whether current spreads are appropriate?

ABS is a specialized market. This tests understanding of securitization.

Explain the structure of asset-backed securities, and how do they differ from corporate bonds?

Convertibles bridge debt and equity. This tests understanding of hybrid securities.

Explain the structure and economics of convertible bonds. When are they appropriate for issuers, and how do you value them?

Emerging market debt has unique risks. This tests understanding of sovereign risk.

What are the key differences between emerging market and developed market corporate bonds, and how do you assess sovereign risk?

A first-round question that tests whether candidates understand the job beyond building a model.

Walk me through the job of a sell-side equity research analyst. Who are the clients, what are the core outputs, and what makes the role useful?

The most common analyst deliverable. And a routine modelling test in research interviews.

Build a trading comparables analysis for four peers and apply it to a target. For each peer: calculate equity value from shares and price, bridge to enterprise value with net debt, and compute…

Core question for sell-side and buy-side research associate roles.

You're initiating coverage on a specialty retailer. How do you build the revenue model, and what drives your estimates versus consensus?

The deliverable a new research associate works toward.

You're initiating coverage on a sector with eight companies. Walk me through the process and what the initiation note contains.

Tests whether an associate can turn a live model into a useful pre-results client note.

Your covered company reports in two weeks. How would you prepare an earnings preview that clients can use, rather than a generic summary of the last quarter?

A sell-side research output simulation prioritising what clients need immediately after earnings.

A covered software company reports a revenue beat, an EPS beat and lower full-year margin guidance. Produce the first client flash after validating the moving pieces.

Tests practical judgement on management access, material non-public information and research independence.

You arrange a management meeting for clients. During preparation, an executive starts to indicate that the upcoming quarter will miss guidance. What do you do, and how do you preserve the value of…

A senior-style judgement test for associates who must defend a published view through volatile results and client challenge.

Your sector team is considering upgrading a stock after a 25% decline. Consensus has already fallen, management credibility is weak, and the valuation looks cheap on your model. How would you decide…

A sell-side research associate review between an earnings call and a client-facing results flash.

Your analyst asks you to review the model and draft flash on a software company that has just reported. Identify the hidden errors that could mislead clients, prioritise the repairs, and write the…

A post-results modelling case testing whether an associate can separate a superficially in-line quarter from a changed earnings algorithm.

Your covered company reports EPS exactly in line with consensus. Segment A revenue grows 12% versus your 8% forecast, but Segment B revenue falls 6% versus your expected flat result. Consolidated EBIT…

Industrials bankers ask this because aftermarket mix can transform valuation.

Why do investors value aftermarket revenue differently from original equipment sales?

A core industrials metric because orders lead reported revenue.

What is book-to-bill and why does it matter for an industrial company?

A basic industrials coverage question on how a production model changes forecasting and cash-flow risk.

Explain the difference between a make-to-stock manufacturer and a make-to-order manufacturer. How does each model change revenue visibility, working capital and downside risk?

A sector judgement question for automation, robotics and factory equipment.

What makes industrial automation an attractive or unattractive sector for investors?

Asked in industrials and semiconductors when revenue disconnects from end demand.

Why does channel inventory matter when analysing an industrial supplier?

A margin-bridge question common when input costs are volatile.

An industrial company says margins fell because of price-cost lag. What does that mean?

Industrials coverage often involves conglomerate break-up and portfolio simplification work.

An industrial conglomerate is considering spinning off a lower-margin division. How do you evaluate whether it creates value?

A harder scenario question connecting supply chain, pricing and margin.

A 15% tariff is imposed on a key imported component. How do you assess the impact on an industrial company?

Industrials and natural resources coverage test this constantly.

An industrial company is trading at 6x EV/EBITDA when its peers historically trade at 9x. Is it cheap?

A foundational arithmetic check used before an interviewer moves to hedging or relative-value trades.

You buy 1,000 shares of Company A at $40 and short 1,000 shares of Company B at $60. One week later A is $44 and B is $66. What is the P&L on each leg and on the combined position before fees?

A first-round equities question that checks whether a candidate understands the basic choice a client makes before trading.

A stock is quoted at $49.90 bid and $50.10 offer. Explain the difference between a market order and a limit order. Which would you use to buy 5,000 shares now, and which would you use if you refuse to…

An accessible corporate-action question that tests whether a candidate separates a price change from a change in value.

A company trading at $120 per share announces a 3-for-1 stock split. Explain what happens to a shareholder with 50 shares, the share price, and the company's market capitalisation immediately after…

An equity-operations fundamental used to test whether a candidate understands that execution and settlement are separate events.

You sell 10,000 shares on Monday but your custodian cannot deliver the shares on settlement date. What has happened, what are the likely consequences, and what would you do first?

Common in execution services, and in any conversation about market structure.

A client needs to sell 2 million shares of a stock that trades 500,000 shares a day. Walk me through how you'd approach the execution and the trade-offs involved.

A desk case that tests how a candidate turns client flow into inventory, liquidity and hedging decisions.

A client wants to sell 2 million shares of a liquid $50 stock. Average daily volume is 10 million shares, and the stock is currently $49.95 / $50.05. What would you assess before quoting a block…

A standard equities-sales-and-trading follow-up after a candidate says a company beat consensus.

A company reports quarterly EPS of $1.05 versus published consensus of $1.00, yet its stock falls 8% after the release. Give a structured explanation and say what you would check before trading it.

An equities-trading case that separates a fundamental short thesis from the securities-finance and execution constraints needed to express it.

A portfolio manager wants to short $20m of a $40 stock ahead of earnings. The stock trades 3m shares per day, reported short interest is 25% of float, and securities finance quotes a 12% annual borrow…

A live-desk judgement case for candidates expected to reason about closing liquidity, client constraints and adverse selection.

At 3:55pm, a client must sell 500,000 shares at the close. The stock normally trades 2 million shares per day, but the auction imbalance is already 900,000 shares to sell and the indicative match…

Banks and funds use this prompt to assess whether a candidate understands risk beyond normal-distribution statistics.

How would you design a stress test for a multi-asset portfolio? What makes a stress test decision-useful rather than a dramatic set of numbers?

A first-round risk interview checks that you can distinguish the core risk types before discussing models.

What is market risk? Give examples for an equity, bond and FX position, and explain how a risk team makes the definition useful in practice.

Foundational maths underpinning every valuation method.

Derive the formula for a growing perpetuity. Then value: (a) $100/year forever at a 10% discount rate, (b) the same cash flow growing at 3%, and (c) $100/year for 10 years at 10%.

Senior quant-risk interviews test whether you can balance a plausible model improvement against control risk and commercial pressure.

A quant team wants to deploy a new equity factor-risk model on Thursday, before a major central-bank decision. It lowers measured risk for a profitable book by 20% because it treats recent sector…

Quant research and derivatives interviews test conceptual understanding over derivation.

Why do we model stock prices as geometric Brownian motion rather than arithmetic Brownian motion? What does Itô's lemma tell us, and why is the drift of log returns lower than the drift of prices?

Senior risk interviews assess whether a candidate can connect portfolio metrics to governance and escalation.

How would you turn a firm's broad risk appetite statement into useful desk-level limits? What makes a limit framework effective?

A foundational derivatives question used to check that a candidate can read an option screen correctly.

A stock trades at $92. Classify a $85 call, a $100 call, a $85 put, and a $100 put as in, at, or out of the money. Which positions have intrinsic value today, and why can an out-of-the-money option…

A structuring interview uses this to test whether the candidate can distinguish a conditional rates hedge from a binding swap.

A company expects to issue fixed-rate debt in six months to finance an acquisition, but the acquisition may not close. It is worried that interest rates will rise before then. Explain why a payer…

A standard analyst-level structuring exercise for a corporate client protecting an equity holding or foreign-currency exposure.

A client owns a stock at $100 and wants protection below $90 for the next year, but will give up gains above $115. Construct the option strategy, describe the stock-plus-options payoff at $70, $100,…

A cross-product structuring case used to test whether a candidate can explain an equity derivative, accounting-sensitive client objective, and dealer hedge in one answer.

A company wants to spend $500m repurchasing stock but wants most shares delivered immediately, before a two-month execution period ends. A bank proposes an accelerated share repurchase (ASR) priced…

Tests the bond vocabulary a junior needs before discussing a Treasury, gilt or corporate bond quote.

A newly issued five-year bond has a 4% annual coupon and trades at par. If market yields immediately rise to 5%, will the bond trade above or below par? Explain the difference between coupon and…

A junior sales-and-trading screen that checks whether a candidate can reconcile a simple Treasury-futures move before discussing a trade.

You buy one Treasury futures contract at 110-16 and sell it at 110-20. The contract's minimum tick is 1/32 of a point and each tick is worth $31.25. What is your P&L, and why is futures-price…

Foundational screen for any fixed income or markets role.

Explain intuitively and mathematically why bond prices move inversely to yields. Which bond falls more when rates rise by 1%: a 2-year or a 30-year? Why?

A futures-market fundamental that separates derivative exposure from the cash posted to support it.

You go long one crude-oil futures contract representing 1,000 barrels at $80 per barrel. Initial margin is $6,000. If the futures price falls to $77 overnight, what happens economically and why is the…

A commodities desk tests whether you can turn a weekly inventory release into a conditional market view.

US crude inventories fall by 6m barrels against expectations for a 1m-barrel build, but refinery utilisation also drops sharply. Is the data bullish for oil?

Oil-product interviews use a crack-spread question to see whether you can translate a relative price into an industrial margin.

Crude oil is $75 per barrel, gasoline is $2.50 per gallon and heating oil is $2.70 per gallon. Explain the 3-2-1 crack spread and what a widening spread says about a refiner.

Credit desk interviews often start by asking candidates to translate a compact market quote into plain English.

A dealer quotes a corporate bond at 98.50 / 99.00, with a spread of 225bp over the Treasury curve. Explain each number and which side you would hit if you wanted to buy $5 million face value.

Credit-desk interviews test whether an analyst can distinguish useful flow intelligence from a reason to chase a price move.

At 10:00am, three real-money accounts ask for offers in the same issuer's 2029 unsecured bond. The bond has widened 12bp while the issuer's CDS and peer bonds are unchanged. The trader asks whether to…

A staffer asks an analyst to prepare a lender presentation after a sponsor announces an acquisition.

You are preparing the first lender presentation for a sponsor-backed acquisition. What do you need to validate before marketing the financing, and what would you put in the materials?

Asked to test whether you understand where a leveraged finance desk actually loses money.

What is market flex, and what happens to the bank if a committed financing cannot be syndicated?