What Does a Finance Analyst Do?

Finance analysts are data-driven professionals that utilize forecasts, financial models and analysis of trends to provide forecasts, analyses and investment recommendations. It requires knowledge in math as well as excellent communication skills in order to do their jobs successfully.

Begin their work by gathering and organizing information into databases, which may include historical financial reports, accounting data from ledgers, stock price information and industry research.

Qualifications

Finance analysts work in investment firms, banks and mutual funds to analyze the financial growth of companies and recommend future investments. They use data analysis techniques to forecast results before reporting them to clients or attending investment conferences; often traveling extensively for meetings with investors or attending investment conferences themselves. Finance analysts must possess at least a bachelor’s degree in business administration or finance as well as strong analytical abilities.

Finance analysts use spreadsheets and statistical software packages to interpret data, detect trends, and create forecasts. Proficient with Microsoft Excel and other data analysis programs – including creating graphs – they must also possess excellent communication skills so as to communicate effectively with clients, investors, and other stakeholders.

Professional accountants must be able to recognize potential risks within a company’s financial strategy and advise management on ways to increase profits, by thoroughly understanding both its balance sheet and income statement.

Job duties

Finance analysts engage in various research tasks to assist their organizations with making well-informed commercial decisions. They monitor macroeconomic trends, examine financial statements and create forecasts for clients. Furthermore, finance analysts use spreadsheets to calculate financial models before reporting back their findings in reports.

Financial analysts must possess strong math skills in order to effectively handle the complex calculations involved with financial modeling, while possessing good communication abilities so as to convey technical jargon clearly to clients and investors. Working long hours requires dedication; many analysts report feeling like family among their colleagues.

Financial Industry Regulatory Authority (FINRA) licenses may be necessary to sell financial products, requiring these professionals to abide by all regulations that pertain to their profession as well as be willing to travel long hours and work varying shifts while attending seminars or courses on new procedures or software updates.

Salary

As the economy improves, more companies require qualified financial analysts. Salaries for this job have increased as more and more organizations require these specialists. With many older financial analysts retiring and leaving open positions behind them, younger professionals must fill these vacancies.

In the United States, financial analysts earn an average salary of $108,600 annually. This consists of both base salary and bonus pay. Salary levels may differ based on location and experience level – for instance in New York the salary tends to be higher than the national average.

Finance analyst jobs with the highest salaries include hedge fund management, which averages an estimated annual average salary of $86,055 on average. Other high-paying finance analyst roles include financial risk manager, credit risk manager and trading systems engineer positions which tend to be in demand and harder to come by; ideal places to look include technology firms and banks.

Work environment

Financial analysts work across industries and environments, spending their days examining data to create models which predict future financial trends and giving presentations about them to colleagues and clients.

Financial analysis is an intensely demanding career that necessitates a bachelor’s degree in finance, business or accounting – as well as extensive experience and proficiency with big data analytics. Employers prefer candidates with master’s degrees in these areas for hiring purposes.

Financial analysts require strong communication skills as they often deal with complex subject matter that others in the organization might find confusing. Furthermore, they must be able to express their findings clearly using slideshows or reports before sharing data electronically with teams within an organization or sharing information electronically with teams within other industries. Individuals possessing strong interpersonal abilities may even become senior financial analysts or advance into managerial roles more easily.