Investment banking is a rewarding yet stressful career path that requires not only strong analytical and interpersonal skills, but also constantly learning and adapting to market changes. Reading widely can expand one’s financial knowledge and help prepare for the dynamic workplace. Here I recommend several excellent books that offer great insights into investment banking from different perspectives.
‘Liar’s Poker’ gives a witty account of 1980s Wall Street investment banking culture
Published in 1989, Liar’s Poker is considered one of the most representative books about 1980s Wall Street culture. The book is a memoir by Michael Lewis recounting his personal experience working as a bond salesman at Salomon Brothers investment bank. With humor and wit, Lewis vividly depicts the intense and absurd workplace dynamics among ambitious young bankers competing for bonuses and promotions. The book provides great context for understanding the excess and larger-than-life personalities that dominated Wall Street leading up to the savings and loans crisis.
‘Barbarians at the Gate’ chronicles the landmark leveraged buyout deal of RJR Nabisco
Published in 1990, Barbarians at the Gate examines the context and personalities behind the record-breaking $25 billion leveraged buyout of RJR Nabisco in 1988. The battle for control of the tobacco and food conglomerate involved Wall Street’s top investment banks and executives. The book provides great insights into the egos, motivations, and Negotiating tactics of the major players. Beyond the personal drama, it also explains the innovative financial engineering and complex debt instruments used to fund mega buyouts of the era.
‘Too Big to Fail’ dissects the 2008 financial crisis and key decisions behind massive bank bailouts
Published in 2009, Too Big to Fail offers a comprehensive, moment-by-moment account of the 2008 financial crisis and government decisions to bail out teetering Wall Street giants like Bear Stearns, Lehman Brothers, and AIG. New York Times financial journalist Andrew Ross Sorkin conducted over 500 hours of interviews with major figures across Wall Street, Washington, and global finance. The book vividly reconstructs pivotal meetings and phone calls to examine how personalities, relationships, external pressures all factored into fateful policy choices with long-term implications.
‘The Quants’ tells the stories of math whizzes behind algorithmic trading’s rise and risks
Published in 2010, The Quants chronicles the advent of high-speed algorithmic trading on Wall Street, and how physics and math PhDs built advanced models that gained huge profits but also increased systemic risks. Financial journalist Scott Patterson profiles key figures like hedge fund legend Jim Simons of Renaissance Technologies, as well as star traders at Goldman Sachs, Morgan Stanley, and DE Shaw. The book examines their backgrounds, competitiveness, breakthrough trading strategies as well as blowups of quant funds like Long Term Capital Management.
‘Black Edge’ reveals massive insider trading scheme at hedge fund SAC Capital
Published in 2017, Black Edge covers the rise and fall of hedge fund SAC Capital, once one of Wall Street’s most successful and notorious funds. Financial journalist Sheelah Kolhatkar gained unprecedented access to uncover how SAC founder Steve Cohen created a culture of employee competition, lavish incentives and skirting ethical lines that enabled widespread insider trading. The book builds suspense chronologically leading up to the FBI investigations, convictions and ultimately the shutting down of SAC for fraud while Cohen himself avoided criminal charges.
The fast-paced investment banking industry continues evolving with new technologies, regulations, financial instruments decade after decade. Beyond textbook finance and Excel models, reading widely about market history, actual dealmakers and trading ecosystems can expand one’s perspective. The above books offer intriguing snapshots into Wall Street investment banking culture, key events, and industry transforms over the past 40 years.