Many financial analysts also double as securities analysts and investment analysts. They work for a variety of financial institutions, including banks and insurance companies. Additionally, they study corporate financial statements and analyze a variety of parameters to determine company value and project future earnings. Financial analysts regularly interact with other corporate professionals, delving into a range of financial matters and improving companies' overall financial performance.
Financial analysts also monitor the industrial sector to assess financial trends and make vital investment-related decisions. They study the legal climate, as well, investigating new regulations, policies, and pieces of legislation that could affect the investment climate or companies' earnings. Financial analysts also observe regional as well as national economies for opportunities to make the best finance decisions in the interests of their clients.
Financial analysts carry out much of their work using financial analysis packages and software. They use spreadsheets and other statistical programs to analyze financial data, report their results in reports, graphs, and presentations, and present recommendations to purchase or sell securities or commodities of interest to their clients. In senior capacities, financial analysts even handle companies' entire financial and securities portfolios. Their responsibilities also include effective handling of all financial risks associated with companies' investment decisions.
Although smaller firms and management entrepreneurs may seek the services of individual financial analysts, they often work on teams at larger organizations. Financial analysts also perform crucial roles at companies going public for the first time, ensuring that they comply with the regulations of the Securities and Exchange Commission. Furthermore, financial analysts study the benefits and drawbacks of proposed mergers and takeovers and explain to prospective investors the benefits of investing in their companies.
Many financial analysts also perform the role of ratings analyst. Depending upon their analyses and recommendations, companies may invest in government bonds or other savings instruments in line with the investment and savings strategies of their organizations. Apart from these crucial professional responsibilities, financial analysts undertake routine duties such as cost and budget analysis within organizations.
Most employers require that financial analysts possess at least a college degree in business administration, finance, or accounting. Additionally, a master's degree in business administration is highly preferred. Individuals with qualifications and experience related to options pricing, risk management, and bond evaluation are also desirable. Private institutions like the CFA Institute offer the CFA charter to individuals who pass a series of three examinations.
Increasing investment by businesses and individuals has resulted in strong demand for financial analysts. The increasing scope of mutual funds, insurance plans, and banking and financial services has increased the number of career opportunities for financial analysts. Significant self-employment opportunities also exist in the market.
