Investment Banking interview preparation
Every question below is either traced to a named firm from a public candidate report, or tagged at desk level when we could not trace it. Answers are written the way you would actually say them out loud — answer first, then the mechanism, then the limitation.
100 questions, mapped to the firms that asked them
- Questions
- 100
- Traced to a firm
- 100
- Firms
- 46
- Updated
- September 2026
020What is the beta of a slot machine?Rothschild & CoMergers and Acquisitions · New York · 2021Rothschild & CoGeneralist · New York · 2026
Say this
Zero. A slot machine's payout is random but the randomness is entirely idiosyncratic, and beta only measures the part of risk that moves with the market. Uncorrelated risk carries no beta.
Then walk it
- Beta is covariance with the market divided by the variance of the market. If the payout is independent of the market, the covariance is zero, so beta is zero.
- The machine is enormously risky in a standard deviation sense. That is exactly the point: total volatility and systematic risk are different things.
- This is CAPM's central claim. The market only pays you for risk you cannot diversify away, and pure gambling risk diversifies to nothing across many pulls.
- The sharp extension: a casino's equity beta is clearly not zero, because discretionary gambling spend rises and falls with the economy. The machine's payout is uncorrelated; the volume of people playing it is not.
- So the answer is zero for the mechanism, positive for the business built on it.
Where candidates lose it
Answering 'very high, because it is so risky'. That confuses volatility with systematic risk and tells the interviewer you do not really understand CAPM. Get to zero fast, then earn the extra credit with the casino distinction.
Expect next
- So why is a casino's beta not zero?
- How would you value your favourite animal?
- What is your personal beta?
Reported by candidates at Rothschild & Co (Mergers and Acquisitions, New York, 2021); Rothschild & Co (Generalist, New York, 2026). Source: Wall Street Oasis.
090You have a rope 30cm long and another 45cm long. Each centimetre takes one minute to burn. How do you measure exactly 25 minutes?Moelis & CompanyInvestment Banking · New York · 2025
Say this
The only tool you have is that lighting a rope at both ends halves its time. With these two lengths the times you can construct are 15, 22.5, 26.25, 30 and 37.5 minutes — 25 is not one of them. I would show you that working and tell you the puzzle as stated has no exact solution.
Then walk it
- The single insight: a rope lit at both ends burns out in half its length in minutes, regardless of where it burns unevenly.
- Light the 30cm at both ends and it is gone at 15 minutes. Light the 45cm at both ends and it is gone at 22.5.
- Best combination for something near 25: light the 45cm at both ends and the 30cm at one end at time zero. At 22.5 minutes the 45 is gone and the 30 has 7.5cm left. Light its second end and it burns out 3.75 minutes later, at 26.25.
- The other combination goes the wrong way: light the 30cm at both ends and the 45cm at one end. At 15 minutes the 45 has 30cm left; lighting its second end gives 15 more minutes, so you land on 30.
- So the reachable set is 15, 22.5, 26.25, 30, 37.5 and the un-halved 45. There is no route to exactly 25.
- In the room, say the halving principle immediately, construct the timings out loud, then say plainly that 25 is not reachable and 26.25 is the closest. Interviewers garble the lengths on this puzzle constantly, and catching that scores better than forcing a wrong answer.
Where candidates lose it
Forcing an answer because you assume the question must have one. Narrate the halving principle, build the reachable times, and say if the target is not among them. Confidently asserting a solution that your own arithmetic contradicts is the actual failure here.
Expect next
- What is the general set of times you can construct?
- How much water can you measure with a 3-litre and a 4-litre bottle?
- What angle do the clock hands make at 3:15?
Reported by candidates at Moelis & Company (Investment Banking, New York, 2025). Source: Wall Street Oasis.
Firm tags come from public, anonymous candidate reports on Wall Street Oasis: strong signal, not sworn testimony. Firms are named as the places a question was reported, not as partners of Fin Maverick. Answers are written for this page to show how to think out loud; they are not scripts to recite.