what is a finance analyst?
A finance analyst guides individuals or businesses on investment opportunities with lucrative outcomes. You use knowledge of the industry, market trends and financial data to find the best strategy for continued growth. Your job involves analysing economic trends, financial information and business news.
As a finance analyst, you can work in investment companies or financial institutions like banks. Some businesses also need internal finance analysts to monitor their investment strategies and minimise losses.
Since you have to build financial models for data analysis and forecasting, proficiency in various statistical software for analysis and building portfolios is important. The tools help you keep track of past and present financial information and use prediction models to determine if an investment deal is viable.
finance analyst job description
As a finance analyst, you can work as a buy-side analyst, where your job entails developing investment strategies for institutional investors like hedge funds, insurance companies and mutual funds. Finance analysts also work for the sell-side and guide individuals or financial service agents on the best-performing stocks, bonds and investments. It is possible to switch between buyer-side and seller-side clients since the roles and prediction models are similar. However, buyer-side finance analysts have broader responsibilities and must be accurate.
Would working in finance as a finance analyst suit your critical thinking and enterprising skills? Then read on to find out what competencies and qualifications you need to thrive in a finance analyst role.
average salary of a finance analyst
According to ONS, a finance analyst earns an average salary of £42,500 annually, which translates to £21.79 per hour. At an entry-level position, a finance analyst earns £32,500 per year. When you have years of experience and multiple skills, you can make £60,000 per year.
Finance analysts earn commissions for successful investments. Some companies pay bonuses and other monetary incentives. You also receive various allowances like medical insurance and pension schemes.
how to boost your salary as a finance analyst
You can increase your salary as a finance analyst by improving your skills and advancing your educational qualifications. As you improve your experience and build your skills, you will be eligible for better salaries and additional benefits. Your duties and area of specialisation also influence your compensation package. For instance, equity finance analysts in the private sector earn more than treasury analysts working for the government. Private companies are likely to pay more and have better commissions than the public sector. The location also impacts your compensation package. Large cities with huge investment firms have a higher demand for finance analysts. The high cost of living also boosts your salary. Small towns with a low cost of living offer a lower earning potential.
types of finance analyst
Some types of finance analysts include:
- investment banking analyst: your responsibility as an investment banking analyst is to help companies meet their financial goals by looking for investment opportunities. You also create economic models and complete evaluations to determine the performance of current investments.
- equity research analyst: your job is to oversee investment portfolios for a group of companies in a particular industry. You can work for both buy-side and sell-side firms to help them decide the securities to hold and the ones to sell.
- treasury analyst: as a treasury analyst, you manage finances in various government agencies. You oversee investment income, cash flow and asset levels. You also advise on ways to improve financial health.
- corporate development analyst: your job is to optimise business processes and enhance income from business operations. You assess operations and expenses and develop better strategies.
working as a finance analyst
A finance analyst role involves predicting and analysing investment performances using industry data and various economic models. Find out the duties, responsibilities and work environment of a finance analyst.
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duties and responsibilities
Specific roles depend on the industry and company you work for, but typical duties include:
- organising information: your job as a finance analyst begins with gathering information from historical financial reports, macroeconomic data, stock price information and accounting data from ledgers. You should organise the information in databases or Excel sheets, clean up the data and arrange it in a format that makes sense. It is important to categorise the data and add formulas to ensure it has consistent formatting that is easy to understand.
- analysing financial results: after cleaning up the data, you need to analyse the historical information using ratios and metrics to determine patterns. Your job is to identify trends and compare the performance with other companies in the industry. From the analysis, you can evaluate the company's value and find ways to improve income from investments.
- forecasting and making projections: your analysis should reveal predictions of the company's performance. You can find various financial models to help you make projections and predict the company's future performance. If you are analysing the viability of investment opportunities, the financial models help you make investment decisions.
- developing recommendations: as a finance analyst, your job doesn't end with crunching numbers and creating financial models. You provide recommendations on ways to improve business operations based on the projections. For instance, you list viable investment opportunities and recommend ways to improve revenue and market share. Aside from writing reports, you have to make presentations to clients and investors.
- risk analysis: as a finance analyst, you can specialise in risk analysis and assess potential risks in a company's financial strategy. You help the managers identify sources of loss and minimise the risks involved in financial investments to increase profits.
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work environment
Finance analysts work in financial institutions like banks, insurance companies and investment firms with a role as insurance consultant. In financial companies, you advise on investment opportunities and help firms grow. Your work is primarily office-based since you spend most of the time analysing data and building financial models. In government institutions, you help the criminal investigation department in identifying fraud.
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who are your colleagues?
As a finance analyst, you work for investment companies, and your colleagues may include fund managers, mortgage brokers, accountants, finance business partners, finance managers and finance assistant roles. Since you work with financial data, you may work close to business development managers, chief executive officers and other specialists, including portfolio managers, business analysts and data analysts.
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work schedule
Finance analysts work the regular 9 am to 5 pm work hours. Although your work schedule takes 40 hours a week, you have to add a few hours to meet your deadlines. Sometimes, your clients need to meet outside work hours to discuss investment opportunities. Meeting clients also require travelling to various business premises and attending investment conferences. If you work for a multinational investment firm, overseas travel will be part of your job. Most finance analysts work full-time, but you can find part-time opportunities.
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job outlook
As a finance analyst, you can specialise in an area of study like portfolio management or fund management. Alternatively, become a risk or ratings analyst and focus on helping companies minimise costs. When you are a junior finance analyst, you should work hard to become a senior finance analyst who oversees larger projects and assists the executive. You can progress to the finance manager position from the senior finance analyst position before becoming the finance director or chief finance officer. The finance analyst job also has self-employment opportunities, but you’ll need a high level of expertise.
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advantages of finding a finance analyst job through randstad
Finding your finance analyst job through Randstad provides important advantages such as:
- a wide variety of training and development opportunities
- an experienced contact person to provide help if needed
- a range of opportunities in your area
- get paid weekly or monthly, depending on the job
- temporary and permanent contracts
Want a permanent contract? A temporary job as a finance analyst is often a stepping stone to an attractive permanent job. Every year, thousands of people earn a permanent contract with great employers thanks to a temporary job found through Randstad. What's more, many companies recruit their permanent employees through Randstad too!
education and skills
You can become a finance manager through the following routes:
- university degree: as an entry-level finance analyst, you need a bachelor's degree in economics, finance, accounting or other relevant business fields. A master's in finance or business administration will boost your career prospects.
- certifications: a finance analyst needs certification from the chartered institute of financial analysts. Certification improves your employment prospects and helps you acquire a chartered status.
skills and competencies
You need these soft and hard skills to succeed in your position:
- research skills: your job involves mining data from various sources to use in financial analysis. Research skills help you find historical data from company records and macroeconomic data from industry sources. You can make predictions from the data analysis with sufficient information.
- attention to detail: you have to be detail-oriented to notice market trends and make accurate predictions. Attentiveness to detail helps you make insightful conclusions based on changes in the market.
- analytical skills: as a finance analyst, you evaluate tons of data and make accurate conclusions. You need analytical skills to ask the right questions, draw accurate conclusions and discern the best solutions for your clients.
- math skills: you should be good in math and numbers since you handle complex calculations in financial modelling. Sometimes you have to use complex equations to complete data analysis. Math skills also help you formulate financial models like charts and graphs.
- communication skills: you need communication skills to explain complex financial jargon to clients and investors. Communication and people skills also help you maintain relationships with stakeholders to gain access to information.
FAQs
FAQs about working as a finance analyst
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what does a finance analyst do?
A finance analyst helps companies make sound investment decisions by using forecasting skills to identify the viability of opportunities. You also assist a business to improve its performance.
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is finance analyst a good job?
Financial analysis is a promising career with exciting prospects and an attractive compensation package. You also help many companies achieve their financial goals.
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what is a financial analyst's salary?
A finance analyst at an entry-level position earns £32,500 per year. Experienced finance analysts earn over £60,000 per year.
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do financial analysts make good money?
Yes. Finance analysts earn good salaries and additional bonuses. Some companies also pay commissions and other benefits.
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how much does a financial analyst make an hour?
With an average salary of £42,500 per year, your hourly rates are £21.79.
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how do I apply for a finance analyst vacancy?
Applying for a finance analyst job is easy: create a Randstad profile and search our job offers for vacancies in your area. Then simply send us your CV and cover letter. Need help with your application? Check out all our job search tips here!
