Editing Investment banking (section)

=====Sales and trading=====
{{main|Sales and trading}}
On behalf of the bank and its clients, a large investment bank's primary function is buying and selling products.<ref>{{cite web |title=What's the role of an investment bank? |url=https://www.investopedia.com/articles/investing/111114/whats-role-investment-bank.asp |website=Investopedia |access-date=29 January 2019 |archive-date=29 January 2019 |archive-url=https://web.archive.org/web/20190129181351/https://www.investopedia.com/articles/investing/111114/whats-role-investment-bank.asp |url-status=live }}</ref> 

''Sales'' is the term for the investment bank's sales force, whose primary job is to call on institutional and high-net-worth investors to suggest trading ideas (on a [[caveat emptor]] basis) and take orders. Sales desks then communicate their clients' orders to the appropriate bank department, which can price and execute trades, or structure new products that fit a specific need. 
Sales make deals tailored to their corporate customers' needs, that is, their terms are often specific. Focusing on their customer relationship, they may deal on the whole range of asset types. 
(In distinction, trades negotiated by market-makers usually bear standard terms; in [[Market maker|market making]], traders will buy and sell financial products with the goal of making money on each trade.
See under [[trading desk]].)

''Structuring'' has been a relatively recent activity as derivatives have come into play, with [[structurer|highly technical and numerate employees]] working on creating complex financial products which typically offer much greater margins and returns than underlying cash securities, so-called "yield enhancement". In 2010, investment banks came under pressure as a result of selling complex derivatives contracts to local municipalities in Europe and the US.<ref name="IB_FT">{{cite news
| url = http://www.ft.com/cms/s/0/0fb16d54-de18-11df-88cc-00144feabdc0,dwp_uuid=eddfd4e0-4bc3-11da-997b-0000779e2340.html
| date = 22 October 2010
| title = UniCredit municipal deal nullified
| author = Rachel Sanderson
| work = [[The Financial Times]]
| access-date = 23 October 2010
| archive-date = 8 November 2010
| archive-url = https://web.archive.org/web/20101108203020/http://www.ft.com/cms/s/0/0fb16d54-de18-11df-88cc-00144feabdc0,dwp_uuid=eddfd4e0-4bc3-11da-997b-0000779e2340.html
| url-status = live
}}</ref> 

''Strategists'' advise external as well as internal clients on the strategies that can be adopted in various markets. Ranging from derivatives to specific industries, strategists place companies and industries in a quantitative framework with full consideration of the macroeconomic scene. This strategy often affects the way the firm will operate in the market, the direction it would like to take in terms of its proprietary and flow positions, the suggestions salespersons give to clients, as well as the way [[structurer]]s create new products. 

Banks also undertake risk through [[proprietary trading]], performed by a special set of traders who do not interface with clients and through "principal risk"—risk undertaken by a trader after he buys or sells a product to a client and does not hedge his total exposure. 
Here, and in general, banks seek to maximize profitability for a given amount of risk on their balance sheet. 
Note here that the [[FRTB]] framework has underscored the distinction between the "[[Trading book]]" and the "[[Banking book]]" 
- i.e. assets intended for active trading, as opposed to assets expected to be held to maturity - 
and market risk [[capital requirements]] will differ accordingly.

The necessity for numerical ability in sales and trading has created jobs for [[physics]], [[computer science]], [[mathematics]], and [[engineering]] [[PhD]]s who act as [[Quantitative_analysis_(finance)#Front_office_quantitative_analyst|"front office" quantitative analysts]].