In the financial services industry, one of the most sought after career options is that of the financial analyst. A financial analyst receives a decent salary, a generous compensation package and job benefits. Since the financial services industry is competitive, it can seem intimidating to break into this career. However, it is significant to prepare appropriately to be eligible for this field. If you wish to become a financial analyst, the following discussion can help you to get ready to be a financial analyst.
What a financial analyst do?
A financial analyst conducts research on macroeconomic and macroeconomic conditions. The professional also studies the company fundamentals to provide suggestions on the business, sector and the industry. Recommending a course of action like buying or selling a company’s stock on the basis of its overall strength (existing as well as predicted) is also the duty of a financial analyst.
Being aware of the current advancements in the field (you want to specialise) will help you to fulfil these duties efficiently.
What is the required educational background of a financial analyst?
If you are in high school and interested to become a financial analyst, it is advisable to take up courses in economics, mathematics and accounting. In college, it is best to acquire a bachelor’s degree in finance and accounting or any other business discipline. Many firms hire graduates with this academic qualification for finance graduate scheme jobs.
After you have completed your college education, the next best step is to obtain an MBA degree. This advanced degree will help you to advance to the position of senior financial analyst.
Certification is an important criteria to fulfil in order to progress in this career. Many firms recruiting financial analysts mention this in their criterion list. Certification examinations for financial analysts are tough. You have to study hard to achieve good grades.
What are the skills required?
Numerical, communication, organisational and analytical skills are the key skills needed in this field. Proficiency in spreadsheets, statistical and graphics packages is a major requirement. Keeping abreast with the latest information on microeconomics and macroeconomics is essential.
What are the different types of financial analyst positions?
Financial analysts specialise depending on the type of organisation they work for. The typical employers of financial analysts are
- Buy and sell-side investment firms
- Insurance companies
- Investment banks
Among these specialities, there are three important types of financial analyst positions- those working for buy-side investment firms, sell-side investment firms and investment banks.
Financial analysts working in the investment industry work for sell-side investment firms and buy-side investment firms. What are buy-side and sell-side investment firms? Buy-side investment firms are investment houses and they manage their own funds. Sell-side investment firms prepare research reports for the investment houses.
A financial analyst employed in a buy-side investment firm conducts research on the stocks that are required to add to an investment fund. On the other hand, a financial analyst working for a sell-side firm reviews the quality of securities in a particular industry. The professional then, prepares reports containing recommendations on the following points:
- Strong buy
- Strong sell
What are the working conditions?
As a financial analyst, you may have to travel extensively to visit companies in order to acquire a first-hand knowledge of the company operations at the ground-level. You may have to attend important meetings and conferences.
A financial analyst’s job offers benefits like health insurance and bonuses.
What is the salary?
The annual average salary of a financial analyst is around ₤50,000 including bonuses and other benefits.
Final tip– a bright career as a financial analyst is assured if you upgrade yourself constantly.