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Everything you need to know about psychometric tests for finance jobs

Everything you need to know about psychometric tests for finance jobs

If you’re applying for a position in the finance sector then at some point you’re going to have to complete psychometric tests. Whether it’s before you even apply, after your online application has been reviewed or, occasionally, after you pass the first round of interviews, there’s simply no getting around it.

Banks receive large numbers of applications during their recruitment cycles, and most candidates are well-qualified, well-educated and have a proven interest in finance. The psychometric tests are an easy and efficient way to sort through the applicants and whittle down the numbers.

Some people underestimate the importance of the aptitude tests but the reality is that they’re crucial to advancing in the application process – banks use them as an easy way to screen applicants and candidates will often be rejected not on the basis of their CV, but on their performance in the online tests.

In most cases, only after passing the psychometric tests will job applicants be contacted by the bank to arrange an interview. However, making it through to the interview stage doesn’t mean that you’ve seen the end of potentially tricky aptitude tests. Candidates who are invited to partake in an assessment centre – usually the final stage in the application process – will also need to content with a variety of aptitude tests on the day itself.

So, what do I need to know?

While not every bank has an identical recruitment process, they definitely are very similar. In general, candidates who apply online for internships or graduate positions will be sent an email containing a link to online tests, and a deadline to complete them. Every bank will require you to complete a numerical reasoning test, and most will ask you to also complete a situational judgement test or a verbal reasoning test.

Numerical Reasoning Tests Why?

Well, almost every position in the finance sector involves working with numbers to some degree. Numerical reasoning tests examine a candidate’s ability to work quickly with numbers and analyse data from various sources. You’ll often be presented with information in the form of graphs and tables and need to use calculate common financial ratios – profit margins, predictions of growth etc. The data won’t just relate to financial scenarios (you may, for example, be shown the nutritional information table for a sports drink and asked to calculate the ratio of sugar to protein) and you’ll also need the ability to quickly solve arithmetical problems.

test1

The actual level of maths that is tested in the numerical tests is fairly basic, and doesn’t extend beyond the secondary school level. You’re not going to be tested on your knowledge on differential equations or lineal algebra. What makes the tests tricky, however, is the fact that they must be completed under time-pressure, and some questions can present an overwhelming amount of data for candidates who aren’t used to working with numbers.

The only way to improve your chances of succeeding in the numerical tests is to practice them. Graduates who have studied subjects without a strong quantitative basis will almost certainly need to spend time brushing up on the maths used in the tests. Even maths and science graduates will need practice as the questions make use of skills that most graduates haven’t used since school. In addition, the timed nature of the tests adds another layer of difficulty.

Get hold of practice numerical reasoning tests for finance positions here.

Situational Judgement Tests

Banks often use situational judgement tests (SJTs) as a way to gauge whether an applicant has the right ‘fit’ for their organisation. You will normally be presented with a scenario that involves a workplace-related problem or conflict that needs to be resolved. The scenarios also tend to present a number of “competencies” and you’ll need to choose which option or course of action is most appropriate.

The questions are not technical in nature (you won’t need to resolve fictional issues around a financial report, for example) but, rather, are designed to assess your values and judgement skills. Often, the answers will be multiple-choice and test-takers will need to arrange the options in a “best-to-worst” fashion.

test2

Many organisations will tell you that there’s no real way to study for a situational judgement test, and that are no “right” or “wrong” answers as they are simply trying to see if your values and personality correspond with the company’s. This might be true, but even if it were (it isn’t), there most definitely are correct and incorrect ways to answer the questions in situational judgement tests. Organisations such as banks tend to place emphasis on teamwork, leadership, initiative and integrity and this should be reflected in your answers.

One tip is to research the company’s values or ethos before applying so that you have an understanding of what they are looking for. Another tip is to make sure that you practice answering situational judgement tests before applying, in order to become familiar with the types of questions that are asked and how to answer them. JobTestPrep’s practice tests provide feedback on your answers and strategies for how to best answer SJT questions.

Practice for your upcoming situational judgement test here.

Abstract Reasoning Tests

Abstract reasoning tests are not used by every single bank in their application process. But the likelihood is that, unless you’re only applying to one bank, you’re going to come face-to-face with one at some point.

test3

Because abstract reasoning is considered to a greater degree to measure intelligence – whereas other types of tests are more influenced by a test-takers level of education and other factors – they are popular with large organisations.

They are usually administered as part of the online screening process, but are also popular as a test of choice at assessment centres. A word of caution – companies often use different terms to describe the same tests. Abstract reasoning tests are often referred to as logical or inductive reasoning tests, so if you’re asked to complete one of these then there’s a good chance it will actually be an abstract reasoning test.

Abstract reasoning tests require an ability to examine information in the form of symbols or matrices and then draw conclusions or logical assumptions. The most common types of question are:  

  • Complete the sequence – decide which shape fits the series 

  • “Set” questions – deciding which “set” a particular shape belongs in (see picture)

  • 'Odd-one-out' problems – which image doesn’t fit the series?
     

Many people don’t have a natural feel for abstract tests and the best advice is to become familiar with them before taking one under timed test conditions where added pressure will make performing well even harder. As with many other forms of psychometric tests, abstract reasoning tests contain certain ‘types’ of questions that will appear in different forms.

Practicing for the tests ahead of time will allow you to recognise a question as belonging to a type, and have a strategy in place to answer it. This is the same concept that we can apply to numerical reasoning tests, where as long as we know where to look for particular sets of data, and how to extract them from a given format, then then it almost becomes a matter of simply changing the numbers. This reduces much of the stress from the real test. The same can be said of abstract reasoning tests. However, in order to become familiar enough to take this approach you’ll need to invest time in practice.

Practice abstract reasoning tests here.

Conclusion

It’s easy to brush off the psychometric tests as a minor part of the job application process. However, it would be naïve to underestimate how important these tests are to your chances of being offered a job. Most banks won’t even look at an applicant’s CV until he or she has passed the psychometric tests, and candidates who pass the tests but score in the lower percentiles may well have their scores used against them when the company starts to look for reasons to reject candidates later on in the process. In fact, during the major recruitment cycles, as many as 40% of applicants to the major banks and financial services companies may be rejected on the basis of their scores on online psychometric tests.

While it may be tempting to cheat and to use the internet or a friend for help, it’s not advisable. Many companies will ask you to re-sit some of the tests at interviews or assessment centres, and if there is a large discrepancy in scores your application will be rejected.

The best way to make sure that you succeed in the psychometric tests is simply to prepare for them by investing time in practice. Becoming familiar with the different types of questions and different test formats will enable you to remain relaxed and confident when taking the real thing, as you will already recognize the format of the majority of the questions.

It’s also important to note that different banks use tests made by different test-providers (there are many), so for anybody who’s serious about acing the psychometric tests it’s vital to know which banks use which test. This way, you’ll know what to expect beforehand, as well as being familiar with the test’s structure and format. JobTestPrep is the only test-preparation company that has practice packs tailored per company/position, and can provide applicants information with exactly which tests they need to practice in order to prepare for specific job applications.

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Are you prepared to tackle the intense recruitment process ahead of you? Get a head start on your peers by taking a psychometric aptitude test! Get full access and learn how to increase your chances of passing the tests successfully.

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