Financial Analyst Job Description: Top Duties and Qualifications

Last updated: June 22, 2022

A Financial Analyst, or Accounting Analyst, studies a company’s financial data to give advice for guiding business investments and overall financial strategy. Their duties include predicting the return on investment for different stocks and business ventures, writing financial reports and collecting industry research to inform decision making.

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Financial Analyst duties and responsibilities

Financial Analysts gather data to understand the trends affecting a specific type of product, geographical region or industry to help their clients make important investment decisions. They often have the following responsibilities:

  • Analyze financial data and provide forecasting support.
  • Prepare reports and projections based on financial data.
  • Recommend individual and collections of investments, also known as portfolios.
  • Evaluate current and previous financial data.
  • Study business and economic trends.
  • Determine a company’s value by examining its financial statements.
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What does a Financial Analyst do? 

Financial Analysts typically work at banks, consulting firms, mutual funds and corporations to generate wise investment strategies and support overall financial growth and stability. Their role is to analyze economic conditions, stock market performance and other details to provide expert advice to company leadership before they make financial decisions. Financial Analysts organize data into accessible reports and perform various types of analysis using key metrics such as yearly growth, return on assets, return on equity and earnings per share. They gather data about other companies to determine industry standards and identify trends as they develop.

Financial Analyst skills and qualifications 

Financial Analysts use a variety of soft skills and industry knowledge to do their jobs effectively, which can include: 

  • Strong understanding of how economic trends, political situations, policies and regulations may affect their client’s investments
  • Analytical skills to process large amounts of information to find profitable investments
  • Verbal and written communication skills
  • Computer skills to effectively use software to analyze financial information, identify trends, establish portfolios and make forecasts
  • Decision-making skills to provide recommendations to sell, hold or buy a security
  • Attention to detail when reviewing potential investments, as small issues may lead to large complications for the overall health of an investment
  • Math skills for estimating financial values

Financial Analyst salary expectations 

A Financial Analyst makes an average of $73,862 per year. Salary may depend on a candidate’s education, experience level and geographical location.

Financial Analyst education and training requirements 

Most employers require Financial Analysts to have a bachelor’s degree in an area such as mathematics, statistics, finance, economics or accounting. In addition, Financial Analysts need a license to sell financial products. The main licensing organization for Financial Analysts is the Financial Industry Regulatory Authority (FINRA). Most licenses require employer sponsorship, so most companies do not always expect an applicant to be licensed when applying. 

Certifications can improve a Financial Analyst’s chances for promotions. One relevant designation is the Chartered Financial Analyst (CFA) certification from the CFA Institute. To become CFA-certified, an individual needs a bachelor’s degree, four years of qualifying work experience and successful completion of three exams. 

Financial Analyst experience requirements

Most Financial Analysts start with a specialization in a specific field of investment. In most cases, a Financial Analyst needs at least some experience working in the finance or investment banking sectors before entering this position. A master’s degree in business administration or finance can prove an applicant’s knowledge in the field, which might be able to substitute for any experience requirements.

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Frequently asked questions about Financial Analysts

 

What is the difference between a Financial Analyst and an Accountant?

Financial Analysts study past financial reports and future investment forecasts, while Accountants work with a business’s day-to-day financial tasks. Accountants track and store a company’s financial records so that Financial Analysts can easily access and interpret business data. Accountants also tend to work exclusively with a business’s direct transactions while Financial Analysts do industry research and outside data collection to inform their decisions and recommendations. Financial Analysts use the reports that Accountants generate to get an idea of a company’s overall financial health and ability to handle various investment risks.

 

What are the qualities of a good Financial Analyst?

A good Financial Analyst is extremely detail-oriented and enjoys finding patterns and trends in the data they work with. They enjoy learning about economics and use their passion to develop foresight into the likelihood of various economic events. Financial Analysts are active learners who seek out new knowledge and consistently hone their strategies for making decisions. Because Financial Analysts have to explain their thought process on financial recommendations to company leadership, they should also be natural teachers who can clearly communicate complex ideas in simple, clear language.

 

What are the daily duties of a Financial Analyst?

Financial Analysts usually work in an office environment during regular business hours. They request files from the accounting department and use finance software to assemble and sort relevant data. Financial Analysts may meet with a company’s legal team to review information about upcoming business deals and ensure that all financial risks are managed appropriately. They prepare visual models of financial information and meet with company management to discuss investment strategies and budgetary needs.

 

What should you look for on a Financial Analyst's resume?

When hiring for a Financial Analyst position, look for candidates who include specific, quantitative information on how their analysis improved profitability on various projects. They should include details on the size of budgets and investments they have managed in the past so you can select a candidate who is prepared to work with your company’s finances. Strong Financial Analyst resumes will also have public speaking, training or presentation experience to indicate that they can effectively present their suggestions to an executive team.

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