Finance analyst job description | Responsibilities | Investment banking | Equity research | Others

This video explains what financial analysts do on a day-to-day basis. I cover their responsibilities and tasks, looking at analysts in investment banking, equity research and FP&A.

For students at university studying accounting business economics and finance a financial analyst role is a very popular and sought after first role in their careers when i was studying economics at university i knew i wanted to work in finance and i knew i wanted to get a role which would act as a solid foundation to build a career upon and are told that getting

A financial analyst role would be that opportunity a lot of people take out financial analyst roles without understanding what the day-to-day looks like and having that knowledge will really help you understand whether an analyst role is for you or isn’t by joining a firm as an analyst without really understanding what the day-to-day responsibilities look like you

Run the risk of not really enjoying the work that you do and having to leave that company soon after you join which doesn’t really look good on your cv in this video i’m going to explain what a financial analyst does i’m going to talk you through their responsibilities and what they focus on on a day-to-day basis i started off my career in finance as an analyst in

A big four accounting firm in the deal advisory division i’m going to talk you through my first and experience through that role you’ll find financial analysts in various different industries and i’m going to break down the most common financial analyst roles that you’ll see towards the end of the video i’ll also go over some of the lesser-known industries which

Have financial analyst opportunities why are financial analyst roles so popular for me there were three particular reasons why i wanted to get a financial analyst role at the start of my career the first reason was the impact my work would have as an analyst the analysis that you do in the role is generally used for decision making purposes so that means that you

Have an influence to a certain extent on what your firm does next which isn’t always the case in all finance roles doing work which directly influences the actions that your firm takes was definitely one factor the second reason why i focus on an analyst role was because it would help me build up key skills which would be beneficial in the long run aside from the

Obvious analytical skills you also get to learn how decisions are made in large companies what factors management look at when making decisions and also how you can make effective recommendations to management and the final reason was that the tasks that are due as an analyst were very varied in nature avoiding repetitive tasks would naturally make the role more

Interesting you can divide financial analysts in two categories analysts in high finance and analysts in non-high finance roles when i say high finance i mean any firm which deals in the buying and selling of securities so that means investment banks asset management firms private equity etc so the other category of financial analysts work for companies that the

General public know so the ones that deal with non-financial products and services so the likes of unilever amazon etc naturally there will be some common aspects between both categories and i’m going to touch on the common aspects first before jumping into the specifics all analysts use financial data and they analyze this data to understand what caused certain

Changes identify any trends make estimations and also make recommendations on what to do next a lot of analysts also combine multiple data sources to get a better understanding of a particular situation aside from financial data some analysts also evaluate other factors such as the businesses operations strategy market trends etc analysts generally need to keep

Informed about industry news and trends so that they can provide a higher quality of analysis which is useful when making decisions another common factor between all analysts is that they need to present their findings and their research to various different stakeholders analysts will prepare reports and powerpoint presentations discussing their analysis and their

Recommendations they need to be clear concise and articulate their theories well in some cases analysts also have to explain certain concepts when stakeholders don’t have an understanding of a particular topic let’s look at specific analyst roles and let’s start with investment banking analysts an analyst at investment bank is an entry level role and most analysts

Have a bachelor’s degree if not a master’s degree analysts role that investment banks are incredibly popular and i even found one article saying that there were 71 applications for each analyst role in an investment bank in 2019. in this video i’m going to focus on analysts in the investment banking division there are various different divisions in an investment

Bank and if you want to learn more about these divisions i’ll leave a video on the end screen so that you can watch that video after this one ends analysts at investment banks said wise companies on mergers and acquisitions and on capital raising activities such as raising debt or raising equity capital through for example initial public offerings analysts have a

Wide variety of responsibilities during a deal but i’m going to talk through some of the core ones here one of the main pieces of analytical work that analysts do is with financial models analysts create and review financial models on a regular basis to help execute a deal for those that might not be aware a financial model is just an excel spreadsheet which contains

The key figures for a company so for example sales expenses etc and it might also contain the entire p l balance sheet and cash flow statements and will have these figures for historical periods and for future periods as well which are the full costs they’ll evaluate the historical figures and performance of a company and they’ll create forecasts based on different

Assumptions and these assumptions can be flexed depending on different scenarios there are other financial models as well such as discounted cash flow model and the leveraged buyout model which are used for valuation purposes specifically when working on a sell-side role an important task that analysts get involved with is writing the information memorandum document

This is a document which tells the story of the company being sold the document contains important information such as what the company does who their customers are and what their financial performance has been like etc analysts will study the company and the market to understand what makes the company unique and what are the key selling points of the business

Which will make it attractive to buyers when creating this document analysts work with senior employees at the client’s firm including the ceo and the cfo another important task that analysts get involved with is supporting business development activities and this will prepare specific company and industry information packs which will be shared with potential

Clients to facilitate discussions senior members of the team will use these information packs during client meetings and some analysts might even join some of these meetings as well i’ve been quite fortunate i’ve attended a lot of these meetings from the start of my career and i’ve understood how these meetings are conducted and i’ve always been encouraged to

Contribute when i can which isn’t always the case at budget bracket investment banks analysts will also play an important role when creating page documents so this is when banks are trying to win new work analysts will have to create these documents which include industry insights and indicator valuations amongst other things moving on to equity research analysts

On the sell side so at investment banks these analysts perform in-depth research on publicly traded companies and they make their recommendations to investors on whether they should buy sell or hold their shares in these companies their main responsibility revolves around creating an equity research report they’ll analyze a company that they’ve been assigned and

They’ll try and understand all aspects of that company including products services customers competitors operations etc they’ll have to keep on top of any industry news that will impact the company’s share price and they’ll also keep on top of any relevant macroeconomic news they’ll also create financial models which will have estimations of earnings for that

Company research analysts have special access to the company’s management and this really helps them to write these equity research reports and make recommendations one final responsibility of equity research analysts that i want to touch on is that they inform the traders of the bank about their recommendations so this information can be passed on to the clients

The bank then generates an income when the client places a trade based on that recommendation so they’re also analysts on the buy side so at asset management firms hedge funds private equity etc similar to equity research analysts on the sell side they’ll analyze the company to understand how it’s performing and make a recommendation to the portfolio manager they’ll

Use the equity research reports created by the south side analysts but they’ll also conduct their own primary research as well they’ll monitor industry news and developments and evaluate the risk to the company and they’ll also create financial models to make estimations of the performance of that company in future years all the research that these analysts do is

To help them make an informed recommendation on which company their organization should invest in they’ll also analyze the performance of companies already in their portfolio so these are the companies that their firm has already invested in a large proportion of the buy side analysts have started their careers on the sell side so at investment banks generally

They’ll work for two or three years at an investment bank before moving across to the buy side the skills gained whilst working on the sell side are directly applicable for example financial modeling industry research and being able to analyze the company in a very thorough manner so those were some of the popular analyst roles in high finance now let’s move on

To non-high finance roles and less start with an analyst in the fp a team of an organization the fp a team is part of the finance department of the company and they perform budgeting forecasting and analysis to help the company make decisions of various types analysts in the team which is an entry level role will evaluate the past performance of the company and

Conduct variance analysis etc to try and understand why there has been underperformance or over performance of a company and will try and inform management of any trends that they discover they’ll conduct analysis on various different aspects of the company so for example different revenue sources expenses investment and machinery employment costs etc they’ll also

Work with different departments to create a budget for the financial year and they’ll consolidate all these budgets for the company as a whole they’ll then analyze variances to this budget which will inform decisions on the back of them fp a analysts also create reports for management which help them make strategically important decisions for example significant

Investment in capex or mapping out of growth and expansion plans for the business these analysts will also help in forecasting the financial performance of the business by creating financial models and updating these on an ongoing basis and they’ll inform management when there are any deviations from the plan those which are some of the tasks that fba analysts get

Involved with and they’ve got other responsibilities as well such as performing working capital analysis or performing competitive benchmarking etc overall the fpna team performs analysis for the management and provides suggestions on what they should do next analysts have a very excited role in this team where they dig deep into the numbers of their own company

I’d just like to agree that fine analysts include financial services such as in banks for example you’ve got credit risk analysts who determine the credit worthiness of a person or a company basically they analyze whether a person is a good candidate to receive a loan and they do this by looking at their past credit history and looking at other factors such as

Their earnings another sector where you’ll find analysts is in real estate analysts help in the acquisition of properties both residential and commercial and they also help on the operational side so after the property’s been purchased so one of their duties could include analyzing the income that comes from these properties so the rent and making recommendations

Based on this so that was a roundup of what a finance analyst does if you want to learn more about the different divisions in an investment bank and what other finance careers there are click on the video on your screen right now

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Finance analyst job description | Responsibilities | Investment banking | Equity research | Others By Finance Unboxed