Recent college graduates who are looking for entry-level finance jobs often seek out financial analyst positions to kick off their finance careers. If you think a career in finance is in your future and a position as a financial analyst might be right for you, make sure you’re up for the duties and responsibilities involved first.
Financial analysts work long hours, are often required to travel at a moment’s notice and must be willing to immerse themselves in extensive research to succeed. They must also be able to grasp and communicate (verbally and in writing) complicated economic and financial insights and data in order to make financially sound recommendations to the companies they support.
This takes a lot of courage, especially if you are making recommendations that involve millions or even billions of dollars.
Another thing to consider when looking for an entry-level finance position is the type of company you would like to work for starting out. The experience you gain now may dictate where you end up working later on. A variety of types of companies hire financial analysts, such as:
– Private banks.
– Investment banks (buy-side or sell-side).
– Brokerage firms.
– Insurance companies.
– Private corporations.
– Government agencies.
Think you have the passion, stomach and work ethic to make it as a financial analyst? Here’s a breakdown of the duties you’ll be required to perform.
Research, Research and More Research
In general, the role of a financial analyst is to cultivate and review large volumes of data then formulate a recommendation based on what you have learned. You will need to examine national and global trends in economics and finance and make predictions based on this research.
Financial analysts also spend time researching the strengths, weaknesses and risks associated with different companies based on the type of firm for which they are working. They are often required to make lengthy, onsite visits to the companies in question during this research phase.
You may be wondering how an analyst’s duties vary based on the type of firm. While the core responsibilities are very similar, there are some differences, because goals vary from one type of firm to the next.
A financial analyst working at an investment bank will research and evaluate companies to determine risks and the potential benefits and profits pertaining to mergers, acquisitions and IPOs (initial public offerings). They will need to closely evaluate financial and economic conditions and often utilize forecasting tools and models.
A financial analyst at a buy-side investment firm will research companies to determine which businesses their organization should or should not purchase stock in for an in-house fund that the firm manages. They also need to closely evaluate financial and economic conditions and often utilize forecasting tools and models.
A financial analyst at a sell-side investment firm prepares research reports for buy-side firms that are looking to purchase stocks to add to an investment fund. These analysts often focus on a specific industry sector and will spend time comparing the quality of securities in that sector. Ultimately they will recommend whether to buy, sell or hold specific stocks.
A financial analyst at an insurance company or private corporation will research a variety of economic and financial data pertaining to the specific industry at hand. In addition, they will look closely at the financial health of the company itself or other companies that it may have an interest in presently or in the future.
Financial Presentations and Reports
Once the analyst has wracked up hours of research and analyzed untold amounts of data, they need to present their recommendations to a department head or team, depending on the firm.
This is where it helps to have solid technical writing skills as well as experience with preparing spreadsheets, charts and graphs. A good analyst will be able to prepare a technical financial report that clearly supports the recommendations they are making – with both numbers and words.
Staying Abreast of Current Economic and Finance Trends
Along with the company and industry sector specific research that analysts perform, they also need to read general financial and economic industry reports, research, journals, newspapers and the like to stay on top of trends in the finance industry as a whole. Seeking out webinars, media reports and industry events also help top financial analysts stay informed.
So if you still think you’re up for the hard work and long hours that come with a career as a financial analyst, Doostang is here to help. Visit our website to search jobs, today. It only takes 30 seconds to sign up.
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“Career: Financial Analyst.” Princeton Review website. Available at http://www.princetonreview.com/careers.aspx?cid=68. Accessed Nov. 15, 2013.
“Becoming a Financial Analyst.” Investopedia website. Nov. 4, 2012. Available at http://www.investopedia.com/articles/financialcareers/06/financialanalyst.asp. Accessed Nov. 15, 2013.
“Best Business Jobs: Financial Analyst.” U.S. News and World Report website. Available at http://money.usnews.com/careers/best-jobs/financial-analyst. Accessed Nov. 15, 2013.