Financial analysts are business and finance experts who help businesses and organizations make wise investments and economic decisions. They analyze and evaluate financial data to assess risks and opportunities. They usually work in investment banking, insurance, or corporate finance. Sometimes they work with private investors or government agencies. They can also work for corporations to make recommendations for products or services to help improve profits.
What is a Financial Analyst?
Financial analysts provide investment advice to businesses and individuals. They research large amounts of financial data, economic trends, and market conditions, making recommendations based on financial modeling and forecasting. Financial analysts help organizations make investment decisions, manage portfolios, and help companies with major transactions such as initial public offerings (IPOs) or mergers and acquisitions (M&A). The role of a financial analyst is to help organizations invest their money wisely to make a larger profit or achieve a desired outcome.
What Does a Financial Analyst Do?
Financial analysts help businesses achieve desired economic outcomes, by researching market conditions, company financial records, industry trends, and making recommendations. Analysts are able to analyze financial data to create models to predict future outcomes. A financial analyst can do different things, for example, giving buy or sell recommendations for stocks, bonds, or commodities. They also research internally to determine whether a company is managing its assets effectively, analyzing the strengths and weaknesses of a company. A good financial analyst can make recommendations to prepare a company for growth, identify potential risks to a company’s financial health, and manage investment portfolios. Analysts also help with mergers and acquisitions, initial public offerings, or improving profitability in the company. Financial analysts examine large amounts of data to strategically plan for a company’s economic future.
Responsibilities of a Financial Analyst
Some of the most common responsibilities of financial analysts are:
- Gathering and analyzing financial data. Analysts research financial markets and find industry trends to find patterns, assess risk, and discover investment opportunities. The analyst may also look at company financial statements, historical trends, competitor analysis, stock information, and market trends.
- Financial forecasting. Finance forecasting looks at potential futures using data to project possible outcomes based on specific variables.
- Build financial models. Analysts create models to predict future financial performance or project how valuable an investment may become.
- Give financial advice to organizations. Financial analysts use data to project potential outcomes, providing strategic advice for buying and selling assets, and other big decisions.
- Evaluate financial risk and reward. Analysts use financial data to evaluate the company’s performance and identity opportunities and risks.
- Develop investment strategies. Financial analysts use their expertise to create investment strategies for their clients and employers.
- Manage funds and portfolios. Financial analysts often oversee funds and portfolios, making buying, selling, and investment decisions.
- Researching trends. An analyst studies financial statements from industry companies, market trends, and financial models to make good investment decisions.
- Giving presentations. Analysts may need to present data to stakeholders using slideshows and reports.
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Where Do Financial Analysts Work?
Financial analysts work primarily in financial institutions or companies where investment strategies are integral to the business. They may also consult for corporations.
These are the primary places where financial analysts work:
- Banks
- Insurance companies
- Hedge funds
- Investment firms
- Private equity firms
- Mutual funds
- Pension funds
- Private corporations
- Real estate investment
Job Outlook and Pay
According to the Bureau of Labor Statistics (BLS), the median annual US salary for a financial analyst in May 2024 was $101,910 [1] [2]. This amount will vary depending on your region, job market, local employers, and total experience. The BLS is also projecting jobs for financial analysts to grow about 6 percent between 2024 and 2034 which is faster than average for all occupations.
How to Become a Financial Analyst
There are no state or federal regulations for requirements to work as a financial analyst, but employers will look for certain qualifications. With that in mind, these are the best steps to begin a career as a financial analyst.
1. Pursue a Degree
Most financial analysts have a degree in finance, business administration, or economics. This will prepare you for more senior positions, and give you the education you need in accounting fundamentals, and the knowledge required to analyze financial markets, statements, risk assessment, and economic trends.
2. Internships
If possible, do internships during school in relevant positions such as accounting or finance. This will give you relevant experience working in places where you must analyze financial statements.
3. Build a Professional Network
It’s important to get to know people in your professional circles. Make connections, introduce yourself, get your name circulated. It will help later on when you are looking for referrals.
4. Job Interview
Once you’ve landed an interview, prepare by researching the company, the type of work they do, their clients, and their track record. Find out what kind of problems they solve and for whom.
5. Gain Work Experience
Your first roles will most likely be entry-level roles that give you real-world experience that help you develop the skills you need to succeed as a financial analyst. Such roles can include:
- Junior financial analyst
- Budget analyst
- Associate financial analyst
6. Extra Certifications
After gaining experience as a financial analyst or wealth management advisor, you can study for advanced certifications such as the Chartered Financial Analyst (CFA), Certified Management Accountant (CMA), Certified Financial Planner (CFP), or Financial Modeling & Valuation Analyst (FMVA). These can potentially help you earn even more as your career progresses.
7. Licensing and Registrations
Financial analysts do not need licensure, however analysts who buy and sell securities, make financial investment recommendations, or directly interact with financial products must get the corresponding regulatory licensing. These can be obtained through the Financial Industry Regulatory Authority (FINRA). Licensure requires sponsorship from an employer, so financial analysts often begin their early careers under supervision until they pass their licensing exams.
Financial analysts who become advisors and manage over $100 million in assets will also need to register with the U.S. Securities and Exchange Commission (SEC).
8. Choose a Specialization
There are several different specializations that financial analysts can work within, each with their own type of clients and responsibilities.
Types of Financial Analysts:
- Portfolio manager. Analysts who oversee a client’s investments, and make decisions on how to invest their funds.
- Fund manager. Financial analysts who work for mutual and hedge funds.
- Rating analyst. Analysts who assess the credit rating and debt repayment capabilities of individuals or organizations. They work for banks, lending, and insurance companies.
- Financial planning analysts. These analysts use financial modeling to plan budgets and forecasting. They create models to predict what key performance indicators (KPIs) will change as the budget or spending changes within an organization.
- Investment banking analyst. They help facilitate enterprise-level corporate transactions, such as mergers and acquisitions, project funding, and initial public offerings (IPO) - when companies first offer shares on the public stock exchange.
- Private equity analyst. These analysts work in PE firms doing research on companies which are not publicly traded. They advise and assist with venture capital (VC) investments and types of acquisition called buyouts.
- Research analyst. These analysts analyze lots of data and information to assist their clients with important financial decisions. They may examine market trends, macroeconomics, historical company performance, and potential investments.
- Financial rink analyst. A risk analyst examines potential return on investment (ROI) for businesses, calculating the possibility of risks in major investments such as mergers and acquisitions. They assess market risks which may disrupt long-term strategies.
- Quantitative analyst. These analysts work with highly technical aspects of financial analysis. Quantitative analysts sometimes develop algorithms to make faster trades on the public stock exchanges or predict prices of stocks and bonds based on historical trends and financial risk data.
What Skills Does a Financial Analyst Need?
After financial analysts receive their education, training, and certifications, the most important aspect of their success is their skills. Financial analysts need a combination of technical and soft skills, including:
- Financial modeling. Familiarity with financial models like the capital asset pricing model (CAPM) help analysts synthesize information and predict future performance. By assessing investments, the organization can make clearer business investments.
- Data analytics. Financial analysts use various programs to analyze data and visualize wider trends quickly and efficiently.
- Valuation. A financial analyst will use business valuations to determine a company’s long term performance, total worth, and ability to repay debt. A good analyst will be to interpret the information in financial statements and create accurate valuation reports for stakeholders.
- Accounting fundamentals. Every financial analyst should have a good understanding of corporate accounting.
- Knowledge of financial markets. Understanding the debt capital and equity markets is an invaluable skill for financial analysts.
- Research skills. An experienced analyst will be able to research a company's financial health and find out information that isn’t obvious at first glance.
- Portfolio management. This is a multidisciplinary skill that includes high-level investment strategies, evaluating investment risk and performance, understanding a client’s risk tolerance and goals, and crafting a portfolio tailored to their needs.
- Knowledge of performance metrics. You must have a deep understanding of certain metrics, such as the price to earnings ratio.
- Communication. A professional financial analyst will be able to communicate investment strategies and financial recommendations to their clients, explaining things in a way that’s easy to understand.
- Decision Making. Making buying and selling decisions can be difficult, and analysts are able to evaluate the data, the risks, and rewards, and make good decisions.
- Attention to detail. The smallest details can be important, and financial analysts pay attention to everything when assessing potential investments.
- Collaboration. A stellar financial analyst can work together with internal and external teams, as well as their clients.
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[1] Note: The data provided in this article is from sources unaffiliated with Campus, and is for informational purposes only and represents the employment field as a whole. They are not solely specific to Campus graduates and, by providing the above information, Campus makes no representation, direct or implied, or opinion regarding employability.
[2] Bureau of Labor Statistics, https://www.bls.gov/ooh/business-and-financial/financial-analysts.htm , Retrieved March 19, 2026.