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What is a Financial Analyst?

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What does a Financial Analyst do?

Financial analysts evaluate the financial situation in their area of expertise and generate appropriate reports, both written and oral, regarding their recommendations. They monitor and interpret available data such as industry and economic trends, forecast the current trends into probable future profitability, determine a fair market value for the sale of company stock, and recommend action to their company or investors.

Some financial analysts support the growing “green industries. These analysts may evaluate a vacant building for the feasibility of retrofitting it, or he or she may analyze the costs and benefits of including green technologies in new construction. The financial analyst may also be involved in generating venture capital for green startup companies. They may monitor and interpret climate change data or clean water data in order to calculate supply and demand, or whether or not to invest in water rights, energy futures, and other tradable commodities within the green industry.

Successful financial analysts are excellent critical thinkers; they can logically determine the best course of action regarding any potential investment. They should be lifelong and active learners in order to remain current regarding market conditions and new technologies, and to be able to predict the long-term results of their investment decisions.

An analyst identifies potential problems within his or her investment options and either seeks a solution to the problem or opts out of the opportunity. Excellent communication skills, combined with the ability to distill large quantities of complex data into clear, concise presentations, allow an analyst to convey his or her investment opportunities in a manner that encourages clients to sign on.

An analyst is willing to take risks in order to generate profit, but he or she is also an expert in risk management and is sensitive to the acceptable risk level for his or her clients. Integrity, dependability, attention to detail, and initiative are hallmarks of a successful analyst.

Financial analysis is a fast-paced, cutting-edge, and highly competitive career choice. A thorough knowledge of ones chosen field on both the macroeconomic and microeconomic level enhances an analyst’s opportunities for advancement within his or her area of specialty. Virtually all analysts rely on publications such as The Wall Street Journal, The Financial Times, and The Economist as well as various electronic media in order to remain at the top of their field.

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