Financial Analyst

Financial Analyst is a person who performs financial analysis to understand the financial health of a company. In my previous articles, Hedge Fund Analyst and Private Equity Analyst, we covered the details about the profiles. Financial Analysis covers fundamental analysis, ratio analysis, financial modeling and valuation. Broadly, financial analysts are required in following areas: 1. Buy side firms 2. Sell side firms 3. Investment Banks Buy side firms are basically different funds, including mutual funds, where the financial analyst studies different companies, performs research and analysis and gives recommendations whether to invest in the company or not for the fund. This is in-house research. Sell side firms are basically research houses or brokerage firms. They cover certain companies and write detailed equity research reports and sell this research to the clients. The main idea here is to sell research and generate brokerage from clients transactions. In Investment banks, the financial analysts role is different. Here, he covers mainly IPO (Initial Public Offering) process and M&A (Mergers and Acquisitions) deals. The analyst plays active role in all these deals. Following is the skill set required for financial analyst profile: 1. Solid analytical skills 2. Curiosity and interest in analyzing, understanding companies in depth

3. Solid fundamental valuation skills acquired in business school, or as a consultant 4. Interest in understanding, analyzing a companys business 5. Clear financial and quantitative concepts 6. Ability to build financial models 7. Sectoral expertise in Telecom, Media, Technology, Insurance, Banking, Food & Beverage. 8. Strong analytical and MS Excel skills (Macros, V-Lookups and Pivot Tables) with strong communication skills In India, entry level financial analysts earn in the range of INR 3, 00,000 7, 00,000 per annum. In London, the same profile will give you salary in the range of GBP 20,000 50,000. In US, for the same profile, you can earn $ 35,000- 80,000. There are many KPOs where fresher and entry level openings are available. However, check the skills they want for these roles. The selection process for the companies involve case based test, and two rounds of interviews. My experience says, if you are really good in fundamental and analytical skills, you can grab such roles. So, brush up your financial knowledge and be ready to test your analytical skills.