How to Become a Financial Analyst: Roles & Responsibilities?

Imagine you run a successful company but need to learn how to utilize, invest or save your money. This is when you will seek the help of a professional, a financial analyst.

A financial analyst evaluates the financial data of a company. They assess the current market conditions to plan how to use the funds optimally. The analyst also predicts the future financial performance of the company.

To become a financial analyst, you must possess strong quantitative abilities and an analytical mind. You also need to have strong communication skills.

As an analyst, you must analyze the advantages and drawbacks of buying or selling company stocks. You need to gauge when to sell, buy or hold the company stocks. 

Although the responsibilities may vary according to the industry, the primary roles and responsibilities remain the same. Let’s take a look at them – 

  • Assessing company’s performance – A financial analyst evaluates the company’s performance based on the balance sheet and other financial statements. Analysts also measure the difference between the actual financial performance and the set parameters. They also evaluate market trends. Based on these findings, the analyst prepares a report on how the company is faring and identifies the areas of improvement.

It also sets the premise for future performance predictions. Finally, the analyst also creates budgets and forecasts revenue and expenditure based on this information.

  • Financial Reporting – The analyst prepares financial reports, the assets & liabilities and evaluates them based on performance parameters. For them, good communication skill is crucial to present the finding to the stakeholders like executives, shareholders, or investors. They also need to collaborate with cross-functional teams, such as sales, marketing, or operations, to gather relevant data. The data tells them if the financial analysis with business objectives is aligned.
  • Investment advice –  The analyst also keeps an eye on the market trends and opportunities. They evaluate investment opportunities, such as mergers and acquisitions, capital projects, or new ventures. They use due diligence, financial modelling and risk assessment to determine the feasibility and potential return on investment. Based on this, they advise the company or individual.
  • Risk-taking mindset – They provide financial advice and guide the company or individual with selling, buying or holding decisions. Hence they are responsible for identifying and assessing financial risks. Therefore, they must develop strategies to mitigate risks and risk management measures.
  • Cost & Variance analysis – Financial analysts identify the cost centres and cost structures. They are responsible for developing strategies that will save costs. They are also responsible for identifying, measuring and reporting the deviation in the actual financial results and parameters set. This financial information helps the management make informed decisions.

The role of a financial analyst is complex and challenging. The evolution of the financial market in the form of cryptocurrency, digital banking & Fintech is demanding new skill sets. So if you want to pursue a career as a financial analyst or investment analyst, upgrading your skills is crucial.

How MITSDE help you become a leading Financial Analyst?

MIT School of Distance Education (MITSDE) is an AICTE-approved distance learning institute. It understands the current skill gaps in the market and hence brings you  Post Graduate Executive Diploma in Banking & Financial Management

The holistic 21-month finance course covers –

  • Basics of finance & accounting 
  • Financial modelling 
  • Financial markets
  • Corporate finance
  • Investment analysis
  • Portfolio management 
  • Mergers and acquisitions
  • International Finance 
  • Hands-on training in the latest tools and techniques

MITSDE  also provides a dedicated team of student success managers to assist learners’ academic journey.

The placement cell offers services like resume-building and career-building sessions to help secure a rewarding career.

Lastly, initiatives like MITSDE Labs and Harbour offer a perfect blend of practical hands-on training and psychological counselling.

Thus, MITSDE offers a 360-degree learning approach that guarantees a rewarding career.