What is financial analysis?
In the financial analysis domain you’ll find some of the real number crunchers of the finance world. Financial analysis has the aim of providing reliable statistics and cold hard facts that can be combined with other types of research to represent what is happening across the company, a particular investment opportunity or markets. Sophisticated financial models and analysis of business and market statistics are the name of the game. This area supports strategists, consultants and decision makers in business to help them steer clear of risk and make the most of the markets to drive their company forward.
Financial analysts work to find solutions to business problems based on their analysis of statistics. They may produce more extensive financial or statistical models (calculations which will produce results that reflect things like market performance) to represent what is going on. They will usually carry out tasks like performance tracking and spreadsheet modelling to help them with this.
Quantitative analysts are able to make sound predictions for markets movements and investment opportunities with their mathematical and economic knowledge and abilities.
Financial analysis also includes data market research. Businesses need to be in the know about all developments, however great or small, in their markets and industries, so there are many analysts working behind the scenes to source the right information and data as it happens and to make it ready for them to use.
You’ll find mathematical and economic minds and quantitative analysts at various levels within a business. You could work as part of an in-house team for a huge multinational organisation, providing analysis to support specific projects and/or wider business strategies.
At least an undergraduate degree or the equivalent is necessary to get started in financial analysis, and given the complex technical, mathematical knowledge required for many roles you’ll spot quite a few which will require a master’s level qualification in a related subject. As well as in-house opportunities for large companies, big employers include professional services firms and financial information providers such as Thomson Reuters and Bloomberg who are used by organisations across the globe.
Why is financial analysis important?
Financial analysis is at the core of the modern finance world. It forms a part of risk strategy, and helps to solve problems with business strategy – it’s a cornerstone for reference in any planning and business makes, from potential investments to new projects and audits.
Quantitative analysis in particular has evolved to become an integral part of investment banking. It’s a great way to get a solid grip of how the financial markets behave, the majority of traders will now have knowledge of how to apply mathematics to aid them in their strategy planning.
Areas of financial analysis…
Quantitative Analysis – Impeccable mathematical and statistical abilities are the name of the game in this area. The focus is to use mathematics to measure and represent various different aspects of the business and ‘predict’ movements of the financial markets. Powerful stuff!
Market Data Research – This is all about sourcing and analysing business and market news for clients and providing easy to digest reports. Keeping on top of the latest news and developments in the industries and markets important to each client is essential!
Designing, developing and maintaining data and analytics products.
Market Data Research
Supplying the finance world with crucial data to guide their decisions!
Realm of financial mathematics, coding and statistics…