17. Financial Analyst

An analyst will write reports on the companies they are supposed to cover, trying to describe the businesses and their opinion of the company's investment potential, usually from a fundamental analysis standpoint. They also summarize that report with a rating, such as "buy," "sell," "market perform," "overweight," "hold," etc.

The analysts get their information by studying public records of the company and by participating in public conference calls where they can ask direct questions to the management. Previously, analysts were said to obtain lots of information (especially from clients of their investment bank), via exclusive meetings with upper management. Regulation FD (Fair Disclosure), is said to prevent most of this from happening at present.

Sometimes referred to as a securities or investment analyst, the financial analyst is concerned with providing a comprehensive understanding of the financial status of a given investment opportunity. A qualified chartered financial analyst can find employment in a number of different settings. Among the choices for work that are open to the CFA are positions within banks, investment firms, mutual and pension funds, and insurance companies.

The financial analyst does more than simply assemble data into a spreadsheet and pass it along. In many cases, financial analysts have to ask some hard questions and stay with the process until answers are secured and verified. This job may mean looking into all aspects of the operation of a company, even some aspects that may not seem to be directly connected to the task. By taking a broad approach to gathering data, it is possible for the financial analysts to develop potential trends for the company or other investment opportunity, based on the indicators that make up the analysis.

Financial analysts in investment banking departments of securities or banking firms often work in teams, analyzing the future prospects of companies that want to sell shares to the public for the first time. They also ensure that the forms and written materials necessary for compliance with Securities and Exchange Commission regulations are accurate and complete. They may make presentations to prospective investors about the merits of investing in the new company. Financial analysts also work in mergers and acquisitions departments, preparing analyses on the costs and benefits of a proposed merger or takeover. There are buy-side analysts and sell-side analysts.