Financial Analyst

Financial education Print Email

Meaning and definition of financial analyst

A financial analyst, also known as securities analyst, equity analyst, research analyst, or investment analyst, is an individual who carries out financial analysis for internal or external clients as a fundamental part of the job. Writing notes or reports conveying opinions is always a part of “sell-side” (brokerage) analyst job and is generally not requisite for “buy-side” (investment firms) analysts. Conventionally, analysts use principles of financial analysis rather than technical chart analysis and strategic evaluation of the market milieu are also routine.

Putting it simple, a financial analyst researches micro and macro economic conditions in addition to the company fundamentals to make business, sector and industry recommendations. They also, usually, recommend a course of action, like buying or selling the stock of a company based upon the overall current and future strength.

Qualifications of a financial analyst

Many firms prefer an analyst to hold a CFA (Chartered Financial Analyst) degree. Besides, there are also various regulatory requirements. Moreover, it is important for a financial analyst to be acquainted with current developments in the field of specialization and in preparing financial models for predicting prospective economic conditions for any number of variables.

How to become a financial analyst

The main steps for getting into financial analysis include:

1. Get appropriate training and firms required by the firms for the position of analysts. Coursework should incorporate classes for accounting, math and economics. Also, it is essential for becoming a financial analyst.

2. A financial analyst needs to learn computer skills, like spreadsheet and database programs, and word-processing programs.

3. A financial analyst should essentially develop strong written and verbal communication skills for they are usually required to explain intricate financial analysis to management people in understandable terms.

4. To become a financial analyst, consider getting a master’s degree in business administration. This advanced degree in business is advantageous for the position of analyst in some firms.

5. Finally, research the various types of financial analyst positions and industries of interest, like investment firms and banks in addition to manufacturing industries. Every industry calls for a special and different type of financial analysis.  

Login to ReadyRatios


Have you forgotten your password?

Are you a new user?

Login As
You can log in if you are registered at one of these services: