In this blog post, Anwesha Majumdar, a student pursuing a Diploma in Entrepreneurship Administration and Business Laws from NUJS, Kolkata, compares and contrasts between investment banking and law. Thus, highlighting “Investment banking vs Law – Which one is better?”
Investment Banking and Law are both extremely prestigious career options in the market today. Many students today often are caught between choosing to go into the finance line or the legal. Mainly, it depends on the student’s aptitude and interest. This article seeks to illustrate the advantages and disadvantages of both these career options to bring more clarity in the minds of anyone who is trying to make such a major decision.
The following sections of this paper will elaborate on the details of both these career options but first, let us understand the basics of both and what exactly do these careers revolve around.
Investment Banking- What is It?
- An Investment banker helps an organization to raise funds through a series of the study of the market trends, the risk involved in investments and the prevalent economic conditions.
- An investment banker provides wide-range of services including endorsing securities, trading of stock and bond, facilitating mergers and acquisitions, maintaining broker-dealer operations and providing financial guidance regarding pricing of securities, issuing and placement of stocks. 
In other words, investment banking is essentially about reaching the expectations of the people who have capital with the people who need capital for any transaction.
Investment Banking has a huge prospect of growth in a developing economy like India now, especially with the benefits that Startups can obtain through the Startup Action Plan launched this year along with various untapped sectors and the eagerness of entrepreneurs for coming up with win/win solutions.
Bonus Read: What is Investment Banking?
Why Investment Banking?
The general advantages of Investment Banking over law are the facts that the study period for investment banking is shorter than law. The pay package, from the very beginning, is good and it gives a very big opportunity for networking.
Law – What is It?
“A lawyer with his briefcase can make more money than a burglar with a gun if he has a sharp wit and intelligence.” – Marion Puzo in The Godfather.
The legal profession in India has undergone a strategic and substantial change over the last few decades. Nowadays, the law aspirants not only figure themselves in courts but, mark the presence in various corporate houses, law agencies, law firms, litigation, administrative services and in many other areas.
“Do not look at Law as a means of making money. Look at law as an instrument for securing justice to people. Engage in issues of public interest. One of the great things of being a public interest lawyer is that you come to learn about a large number of important public issues from the persons who are experts in the field on a one-to-one basis, something you could never do otherwise. It’s a very rich and rewarding experience.”
– Prashant Bhushan, Senior Advocate, Supreme Court of India.
- When it comes to the legal profession, the advantages are that there is earning potential. Depending on the field that one may be going into, regardless there is earning potential.
For example, in the Corporate field, the money is good and steady and keeps increasing. Whereas in litigation, in the beginning, the money is less but, exposure is a lot more and if continued, eventually the money per case even exceeds the salary of a corporate lawyer.
- A legal career has diverse practice areas, especially today, there is legal assistance required in almost every industry, if not all. The spectrum of law has steadily increased over the years and this will continue to do so in future as well. Therefore, law has more options and is a broader career to be in, which still gives you options to explore various aspects of the field.
- With a law degree, one can always choose to either work or go for further studies like LLM or JD and get into academics. Regardless, every aspect of the profession is aimed to help people.
Investment Banking vs Law
- In terms of the skillset required, both investment banking and law require the same skills, like good teamwork, focused, strong work ethic and high emotional intelligence.
- Both the fields require demanding working hours and pressurizing seniors.
- But, among the two career paths, Investment banking requires more Quantitative Acumen.
- Students who are good with numbers should ideally pursue investment banking. A single mistake with numbers can cost companies a lot of money in investment banking.
- As mentioned above, law is comparatively broader therefore, various skillsets can be adopted in various fields of law depending on the strengths of the student.
- For example, litigation lawyers need to be thick skinned, aggressive, persuasive and have high stamina physically and mentally because the courts require a lot of running around along with mental strength to tackle the long drawn court cases and filings.
- Whereas, corporate lawyers need to be focused, have an eye for detail and should have outstanding critical thinking abilities.
- International lawyers on the other hand, require one to be bilingual or multilingual and have good skills in comparative analysis as he/she will be required to analyze the law structure of more than one country and draw parallels after understanding both.
- Starting salary of an investment banker is marginally higher than that of a lawyer.
- Lawyers ideally should be more updated with developments as the amendments in law, especially corporate law happens frequently as opposed to the amendments in aspects of investment banking.
- Lawyers and investment bankers both may get stuck in their careers, but the escape route or recuperation route for lawyers is easier than that of an investment banker.
Suggestive Read: What do Contract Lawyers do?
As mentioned above, mainly it depends on the student’s acumen to decide which career path would be best suited for themselves. I personally believe that one learns a lot more in the legal profession than in investment banking. I have formed this opinion over the years and have seen that, in law, the scope of learning is a lot more than in investment banking. The quality, as well as quantity of knowledge in law is more and so is the prestige of being a lawyer.
Most of the eminent people in world history, who changed the course of politics or ways of their country were mainly lawyers. This is mainly because of the broad-based knowledge they achieve. A lawyer can even do well in the financial field, like for example Arun Jaitley, but usually, it is hard to transition the other way around. Therefore, as a professional, if a student has the common skillset for both these career paths, I would suggest he/she go for the legal profession.
Overall, what matters is what’s your calling? Investment banking or law? Because Skillset is Primary but it cannot be developed without your love towards the subject.
So, do Comment below your views regarding Investment banking, law & passion. And yes, don’t forget to Share 🙂
References – Investment Banking- Can it be a career option for you? By: Dharmveer. May 9th 2012
 Law in India: An Honourable Career, By: Apratim Chatterjee. February 11th 2014.