44 answers
Teresa
Student
Hong Kong
1
Question
Updated
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Skills Required for a Financial Analyst
#internship #business #finance #career #financialanalyst #analyst #skills
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44 answers
Nikki Aquino
Financial Analyst
16
Answers
Rolling Meadows, Illinois
Updated
Nikki’s Answer
Here is a short list of skills that I found to be very valuable as a Financial Analyst:
Technical skills:
Being very comfortable with large amounts of data and having the ability to look at data in various angles, slicing/dicing, summarizing
Building a model that takes inputs, performs calculations and provides an output
SQL is very helpful (but not required)
Soft skills:
Analyzing data to identify historical trends
Ability to explain why trends are moving in a certain direction
Ability to provide recommendations based on analysis performed
Communicating analysis and recommendations to a target audience
Being curious about what drives growth/decline in your industry
Working with a team and aligning on common goals
Tools used in the job:
Excel for analysis, modeling and visualizing/presenting data
Powerpoint for presentations
Tools for pulling data (Essbase, SQL editors, Cognos, etc)
Technical skills:
Being very comfortable with large amounts of data and having the ability to look at data in various angles, slicing/dicing, summarizing
Building a model that takes inputs, performs calculations and provides an output
SQL is very helpful (but not required)
Soft skills:
Analyzing data to identify historical trends
Ability to explain why trends are moving in a certain direction
Ability to provide recommendations based on analysis performed
Communicating analysis and recommendations to a target audience
Being curious about what drives growth/decline in your industry
Working with a team and aligning on common goals
Tools used in the job:
Excel for analysis, modeling and visualizing/presenting data
Powerpoint for presentations
Tools for pulling data (Essbase, SQL editors, Cognos, etc)
Thank you!
Would you mind telling me how I can develop the soft skills you mentioned?
Teresa
It does take some time to build on the soft skills I mentioned, but one way you can start developing good analytical skills is by putting some effort in working with data in your school projects. For example, if you are provided with a data set for a case analysis, spend some time summarizing the data in various ways and create a chart to trend the data over time.
If there is an industry that you are interested in, challenge yourself to understand what drives sales for certain products in that industry.
Hope this helps and good luck!
Nikki Aquino
Your advice is useful! Thank you so much!
Teresa
Sabrina Wright
Accountant
4
Answers
Atlanta, Georgia
Updated
Sabrina’s Answer
Use of excel functions (Example-vlookup,pivot tables), financial ratios (inventory turnover, internal rate of return, quick ratio, etc.) Presentation skills
Thank you!
Teresa
Great answer Sabrina. I really like this one. I majored in accounting and started my career as an accountant. I took the college courses related to Microsoft Excel and databases (using MS Access) to learn these tools. You want to learn these tools to be a financial analyst - Excel is necessary. Knowing how to develop and use Access and other databases is good - but in my opinion, knowing how to use Excel is key.
Joel Sung
Ryan Cole
Finance, Outsourcing, Relationship and Performance Management
3
Answers
Frisco, Texas
Updated
Ryan’s Answer
Hello,
The first skill that comes to mind is to be inquisitive and as curious as possible. Never being afraid to ask questions. Seek background on how things work, how decisions are made, and why.
Additionally, being willing and excited to learn new things. Let's not forget about expecting change to occur early and often, if you are able to adapt, you'll set yourself up for success. I can tell you that analysts are needed in so many types of businesses. You will find a lot of analysts that may not have started in that field, but their interests ended up guiding them to where their skills and interests fit best.
The technical skills - Learn as much about excel, R, SAS etc, as possible, take advanced courses (classroom and online).
Learn Powerpoint, Tableau, and other software as you will need to present your findings and recommendations to your audience.
A good start would be to look through the courses offered at your local community college, then Google to learn more about what they do and how they are used.
Best of luck to you. I trust you will do well.
The first skill that comes to mind is to be inquisitive and as curious as possible. Never being afraid to ask questions. Seek background on how things work, how decisions are made, and why.
Additionally, being willing and excited to learn new things. Let's not forget about expecting change to occur early and often, if you are able to adapt, you'll set yourself up for success. I can tell you that analysts are needed in so many types of businesses. You will find a lot of analysts that may not have started in that field, but their interests ended up guiding them to where their skills and interests fit best.
The technical skills - Learn as much about excel, R, SAS etc, as possible, take advanced courses (classroom and online).
Learn Powerpoint, Tableau, and other software as you will need to present your findings and recommendations to your audience.
A good start would be to look through the courses offered at your local community college, then Google to learn more about what they do and how they are used.
Best of luck to you. I trust you will do well.
Thank you. Could you tell me more about the personalities of financial analysts?
Teresa
Bailey
Student
Ottawa, Ontario, Canada
1
Question
Updated
Bailey’s Answer
Analytical Skills, Computer Skills, Detail Oriented, Interpersonal skills, just to name a few!
Thank you!
Teresa
Jack K.
Economist/Analyst Manager
5
Answers
Fairfax, Virginia
Updated
Jack’s Answer
When I interview people for a business analyst position, here's what I tell them...
A beginning analyst makes a report for me and says "Here's the report you asked for."
A better analyst makes a report for me and says "Here's the report you asked for, take a look at the unusual stuff here and here."
The great analyst makes a report for me and says "Here's the report you asked for. I found unusual stuff here and here. The first one is a typo. I talked to the people that feed us the data and they'll have it fixed for next week's report. The second one might be a change in customer behavior that will affect our business, here's what I recommend we do next."
In summary, gather data, look for patterns and anomalies, and make recommendations. Very few people can do this when they start a job, but I think it's good to aim for.
A beginning analyst makes a report for me and says "Here's the report you asked for."
A better analyst makes a report for me and says "Here's the report you asked for, take a look at the unusual stuff here and here."
The great analyst makes a report for me and says "Here's the report you asked for. I found unusual stuff here and here. The first one is a typo. I talked to the people that feed us the data and they'll have it fixed for next week's report. The second one might be a change in customer behavior that will affect our business, here's what I recommend we do next."
In summary, gather data, look for patterns and anomalies, and make recommendations. Very few people can do this when they start a job, but I think it's good to aim for.
Thank you. Do you have any advice for penultimate year students to land a financial analyst internship?
Teresa
Penultimate year in high-school or college?
Jack K.
Penultimate year in college
Teresa
I completely agree with Justina's comment about internships. My company sends out campus recruiters every fall, so look for events like that at your school or other schools in the area. The recruiters are looking for both employees and interns. If there's a campus career center, they should have a schedule of job fairs. You should certainly also ask your favorite professors about opportunities. Some of my professors had consulting jobs during the summer, so they were connected with local businesses. Check out the websites of large employers in your area and see if you can find contact info for the recruiting department. Finally, don't forget about professional organizations like the CFA Institute (CFA stands for Chartered Financial Analyst).
Jack K.
So I guess it also depends on business networks, right? Do you think LinkedIn is helpful in that?
Teresa
It can be helpful, but it isn't magic. Speaking personally, if a friend of a friend reaches out to me, I'll ask my friend for an opinion. But that doesn't work for a friend of a friend of a friend. The more links in a connection, the weaker it is.
It looks like you follow up with everyone who answers your question, so you've got networking skills. It wouldn't hurt to ask your contacts to send an intro email to someone they know. Then you can ask to set up a quick (15-30 min) chat to learn more about their company and what they do - an informational interview. If things go well you can ask them about anybody else you can talk to. As long as you're polite and don't spam anyone, the worst that can happen is somebody says no, in which case you're no worse off.
Jack K.
Thanks for your advice! They are really helpful. I guess I could start building up my Linkedin profile first.
Teresa
John Frick
Career Coach and Mentor
995
Answers
California, CA
Updated
John’s Answer
While there are basic financial analyst skills, successful financial analysts possess essential qualities that put them ahead of the pack. If you want to provide value to your company and to excel in your career, you should strive to develop these unique abilities.
1.) EXCEPTIONAL LEADERSHIP – Those who succeed in financial analysis are those who are self-driven and who can motivate others to move forward. Leadership is the foundation on which effective communication, teamwork, project management and other daily tasks are built upon. Including your leadership experience in your resume may give you an edge over many other candidates. Leaders have the ability to transform.
2.) ANALYST EXPERIENCE – To be a good analyst, you will need to learn how to use the tools in spreadsheets and databases. These tools will assist you to combine disparate data, tackle problems and make presentations to the management. It is also important for you to know the style and preferences of your employer. Different managers will prefer different modes of data representation.
3.) TECHNOLOGICAL EXPERIENCE – There have been many technological advancements in business, and the financial services industry has not been spared. These developments have played a huge role in streamlining processes in this industry. This skill is increasingly becoming a necessity for all candidates. If you can acquire more than the minimum tech knowledge required, you will have an added advantage.
4.) INFORMATION IS KING – A good analyst will still be able to come up with valid conclusions even when they don’t have all the information. You should be able to have an educated gut feeling that tells you whether some information is relevant or not. It is being able to identify instances where continuing with the analysis will not help the process. It is the reason why most accountants and programmers may have a hard time becoming financial analysts; they are so hung up on order and numbers.
5.) CONFIDENT DECISION MAKING – As an analyst, you must understand the risks and consequences that would result from any decision you make. Most of the decisions you make will have a great impact on the company. This impact can be positive or negative. You should do proper research to ensure you have all the relevant information beforehand. It will make sure that the decision you make is the best for the firm or client.
Due to increased global competition and rapid changes in the industry, companies need to have stronger analytical abilities and to make better predictions to improve their financial results. Good analysts will be required to take up this responsibility. It is no wonder that it is one of the jobs with the highest starting salary. The competition will be high no doubt. You can stand out by acquiring the necessary financial analyst skills.
Hope this was helpful Teresa
Accounting Skills – Including knowledge of standards and techniques, as well as calculating budgets, cost analysis.
Communication Skills – Financial analysts should also possess communication skills, as these skills can directly influence working relationships.
Problem-Solving Skills – Financial analyst need to have the ability to come up with creative solutions to financial issues should they arise.
Financial Literacy Skills –Financial analyst need to have the ability to decipher current investment markets and interest rates.
Analytical Skills – Financial analyst need to have the ability to forecast, prioritize, and recognize financial problems.
1.) EXCEPTIONAL LEADERSHIP – Those who succeed in financial analysis are those who are self-driven and who can motivate others to move forward. Leadership is the foundation on which effective communication, teamwork, project management and other daily tasks are built upon. Including your leadership experience in your resume may give you an edge over many other candidates. Leaders have the ability to transform.
2.) ANALYST EXPERIENCE – To be a good analyst, you will need to learn how to use the tools in spreadsheets and databases. These tools will assist you to combine disparate data, tackle problems and make presentations to the management. It is also important for you to know the style and preferences of your employer. Different managers will prefer different modes of data representation.
3.) TECHNOLOGICAL EXPERIENCE – There have been many technological advancements in business, and the financial services industry has not been spared. These developments have played a huge role in streamlining processes in this industry. This skill is increasingly becoming a necessity for all candidates. If you can acquire more than the minimum tech knowledge required, you will have an added advantage.
4.) INFORMATION IS KING – A good analyst will still be able to come up with valid conclusions even when they don’t have all the information. You should be able to have an educated gut feeling that tells you whether some information is relevant or not. It is being able to identify instances where continuing with the analysis will not help the process. It is the reason why most accountants and programmers may have a hard time becoming financial analysts; they are so hung up on order and numbers.
5.) CONFIDENT DECISION MAKING – As an analyst, you must understand the risks and consequences that would result from any decision you make. Most of the decisions you make will have a great impact on the company. This impact can be positive or negative. You should do proper research to ensure you have all the relevant information beforehand. It will make sure that the decision you make is the best for the firm or client.
Due to increased global competition and rapid changes in the industry, companies need to have stronger analytical abilities and to make better predictions to improve their financial results. Good analysts will be required to take up this responsibility. It is no wonder that it is one of the jobs with the highest starting salary. The competition will be high no doubt. You can stand out by acquiring the necessary financial analyst skills.
Hope this was helpful Teresa
John recommends the following next steps:
Thank you! Your advice is really helpful! I even have not thought of some of the you mentioned. Regarding the fourth ability, may I ask how should I develop it?
Teresa
“You can’t see the forest for the trees.” Being able to a draw your conclusions even when the spreadsheet and database information is measurable, don't get fixated on individual details, or "trees," that he completely loses sight of the overall issue, or "the forest."
John Frick
Understood! Thank you so much!
Teresa
Hi Teresa, I added some additional required Financial Analyst Skills under next steps. Hold fast to dreams.
John Frick
Thank you so much, John! I hope I can achieve my career goals soon!
Teresa
Nicole Barber
Underwriter
4
Answers
Las Vegas, Nevada
Updated
Nicole’s Answer
Some basic skills for a financial analyst is understanding financial statements. Having an accounting background/knowledge is extremely helpful with this. It's not only about being able to read the financials, it's about understanding what steps it takes to produces the statement, how to do the journal entries, how to balance everything out. That's where having some experience with accounting helps tremendously.
Once you have the basics down, learning how to analyze trends and interpret the financial results is the next step. I was always amazed when I started my career how people who were well established could look at a financial statement and know if it was a strong company or not. Now, after almost 7 years, I'm one of those people. This skill takes time to develop and you continuously have to push yourself to step out of your comfort zone to learn something new. The more financial statements and exposure to all different types of companies you can get, the better off you will be.
To build on this skill, it helps to write about the trends you see and try to explain them, which is where the hard part comes in. I like to start by talking to the business owners. Hearing their story about their business, what they do, what changes the company has made in the last few years, what they are planning moving forward. Looking at the whole picture really adds details to the numbers and helps to explain what's going on with the company.
As I said, this isn't anything that happens over night. This skill takes time to develop. But if you continue to expose yourself to new businesses and industries, and find someone to give you a bit of guidance on your analysis skills, you can be one of those people someone new looks up to.
Once you have the basics down, learning how to analyze trends and interpret the financial results is the next step. I was always amazed when I started my career how people who were well established could look at a financial statement and know if it was a strong company or not. Now, after almost 7 years, I'm one of those people. This skill takes time to develop and you continuously have to push yourself to step out of your comfort zone to learn something new. The more financial statements and exposure to all different types of companies you can get, the better off you will be.
To build on this skill, it helps to write about the trends you see and try to explain them, which is where the hard part comes in. I like to start by talking to the business owners. Hearing their story about their business, what they do, what changes the company has made in the last few years, what they are planning moving forward. Looking at the whole picture really adds details to the numbers and helps to explain what's going on with the company.
As I said, this isn't anything that happens over night. This skill takes time to develop. But if you continue to expose yourself to new businesses and industries, and find someone to give you a bit of guidance on your analysis skills, you can be one of those people someone new looks up to.
Thank you, Nicole! I am glad that I have taken some accounting courses before.
I find your suggestion useful but as an undergraduate, I am not sure if I can get the chance to meet business owners. Is there any way to train the skills you mentioned?
Teresa
Jason Cao
Financial Analyst
2
Answers
Los Angeles, California
Updated
Jason’s Answer
Since you are currently a student I would suggest that you should really focus on your accounting skills. If you have the opportunity to take any accounting courses at your high school or college, I would strongly advise you to do so. A strong understanding of accounting principals is going to help you better understand the data/numbers you are working with no matter what type of Company you are working with.
Depending on what type of industry you go into as a financial analyst you may want to focus on specific technical skills that may be required or preferred. For example, many financial analysts at technology companies such as Google, Facebook, or Apple might need to use programs such as SQL to help extract and manipulate the large amounts of data/numbers they work with.
Regardless of what industry you might want to work in as a financial analyst being comfortable in working with Microsoft Excel and knowing how to create a financial model will be very helpful. A financial model is typically made in a spreadsheet software such as Excel where you can forecast a business's future performance. While it is important to understand the numbers and where they are going, it's even more important be able to derive insights from the data and numbers you're working with. Your analysis of the financial data will be a crucial part of many business decisions within any Company you work for.
Depending on what type of industry you go into as a financial analyst you may want to focus on specific technical skills that may be required or preferred. For example, many financial analysts at technology companies such as Google, Facebook, or Apple might need to use programs such as SQL to help extract and manipulate the large amounts of data/numbers they work with.
Regardless of what industry you might want to work in as a financial analyst being comfortable in working with Microsoft Excel and knowing how to create a financial model will be very helpful. A financial model is typically made in a spreadsheet software such as Excel where you can forecast a business's future performance. While it is important to understand the numbers and where they are going, it's even more important be able to derive insights from the data and numbers you're working with. Your analysis of the financial data will be a crucial part of many business decisions within any Company you work for.
Nicole Barber
Underwriter
4
Answers
Las Vegas, Nevada
Updated
Nicole’s Answer
Some basic skills for a financial analyst is understanding financial statements. Having an accounting background/knowledge is extremely helpful with this. It's not only about being able to read the financials, it's about understanding what steps it takes to produces the statement, how to do the journal entries, how to balance everything out. That's where having some experience with accounting helps tremendously.
Once you have the basics down, learning how to analyze trends and interpret the financial results is the next step. I was always amazed when I started my career how people who were well established could look at a financial statement and know if it was a strong company or not. Now, after almost 7 years, I'm one of those people. This skill takes time to develop and you continuously have to push yourself to step out of your comfort zone to learn something new. The more financial statements and exposure to all different types of companies you can get, the better off you will be.
To build on this skill, it helps to write about the trends you see and try to explain them, which is where the hard part comes in. I like to start by talking to the business owners. Hearing their story about their business, what they do, what changes the company has made in the last few years, what they are planning moving forward. Looking at the whole picture really adds details to the numbers and helps to explain what's going on with the company.
As I said, this isn't anything that happens over night. This skill takes time to develop. But if you continue to expose yourself to new businesses and industries, and find someone to give you a bit of guidance on your analysis skills, you can be one of those people someone new looks up to.
Once you have the basics down, learning how to analyze trends and interpret the financial results is the next step. I was always amazed when I started my career how people who were well established could look at a financial statement and know if it was a strong company or not. Now, after almost 7 years, I'm one of those people. This skill takes time to develop and you continuously have to push yourself to step out of your comfort zone to learn something new. The more financial statements and exposure to all different types of companies you can get, the better off you will be.
To build on this skill, it helps to write about the trends you see and try to explain them, which is where the hard part comes in. I like to start by talking to the business owners. Hearing their story about their business, what they do, what changes the company has made in the last few years, what they are planning moving forward. Looking at the whole picture really adds details to the numbers and helps to explain what's going on with the company.
As I said, this isn't anything that happens over night. This skill takes time to develop. But if you continue to expose yourself to new businesses and industries, and find someone to give you a bit of guidance on your analysis skills, you can be one of those people someone new looks up to.
Jason Runco
Business Analyst
1
Answer
San Jose, California
Updated
Jason’s Answer
To be successful as a Financial Analyst or Analyst of any sort requires a willingness to dig into the details and requires you to have an intimate knowledge of the business that you’re supporting. The key to being a Financial Analyst is being able to understand the data that your working with and being able to prepare or present guidance based on that data, which in turn will help drive key business decisions. You will always want to be cognizant of your audience and present data in a way which is consumable to different levels of management, from peers to CEO’s. Being proficient in programs like excel and tableau can be key in being able to manipulate large data sets. Keep in mind that not all companies use the same financial systems and may store data in home grown tools that you would need to learn how to use on site. Being able to show trends, formulate hypothesis and drive the business through data/analytics is critical. The more proficient you are with the tools that you use, the more willing you are to ask the tough questions, and the ability to derive conclusions from the data will make you successful as analyst.
Conor Rooney
Finance
1
Answer
Saint Paul, Minnesota
Updated
Conor’s Answer
I support the answers/advice already provided and don't want to duplicate, so I would offer the advice of always trying to be observant of your colleagues/superiors. This is a generic comment on purpose as it is meant to be regarding everything. A few basic examples that may help illustrate:
(1) If you notice your colleague continually asks about a particular analysis in reviews, see if you can help prep the analysis in advance
(2) If you notice that no one chews gum in a conference room meeting, follow accordingly
(3) Ask to review an analysis with your colleague together so you can get a sense of what they are specifically reviewing in the analysis and may find a new learning perspective
(1) If you notice your colleague continually asks about a particular analysis in reviews, see if you can help prep the analysis in advance
(2) If you notice that no one chews gum in a conference room meeting, follow accordingly
(3) Ask to review an analysis with your colleague together so you can get a sense of what they are specifically reviewing in the analysis and may find a new learning perspective
Chris Albers Denhart
Project Manager
2
Answers
Washington, Washington
Updated
Chris’s Answer
Hey!
More technical skills to build:
1. MS Excel. If you know and enjoy working in excel you'll always be employable!
2. Data analytics software like R (free) SAAS, Stata, etc. This will help you crunch larger sets of data and build forecasting models, etc.
3. PowerPoint. After all the numbers are crunched and models are built, you have to communicate your findings to your manager, partners, etc. Knowing how to present data is crucial.
Hope this helps!
Chris
More technical skills to build:
1. MS Excel. If you know and enjoy working in excel you'll always be employable!
2. Data analytics software like R (free) SAAS, Stata, etc. This will help you crunch larger sets of data and build forecasting models, etc.
3. PowerPoint. After all the numbers are crunched and models are built, you have to communicate your findings to your manager, partners, etc. Knowing how to present data is crucial.
Hope this helps!
Chris
Thank you so much!
Teresa
Kristyn Dunn
Strategic Planning, Analytics and Reporting
2
Answers
Washington, Washington
Updated
Kristyn’s Answer
Hello! To prepare yourself for a role as a financial analyst, you may want to consider acquiring or honing the following skills:
1. Data analysis - Understanding how to compare/contrast sets of financial data, validate the data and perform trend analysis
2. Technology familiarity e.g. Microsoft Word, Microsoft Excel, Tableau Prep, Tableau
3. Written and verbal storytelling so that you will understand how to crisply communicate your findings, the impact of those findings and your recommendations to the individuals requesting the financial analysis.
4. Communication skills so that you can learn how to ask the right questions so that you can get context behind any changes in the numbers from one time period to the next. Also, these skills will help you frame the questions in a way your audience understands and is willing to help.
5. Statistics - So you can use basic concepts like descriptive statistics (mean, median, mode) progressing to more advanced concepts, as needed for analysis and forecasting
6. Foundational Business Understanding obtained through Economics, Accounting, Marketing, Business Mgt, Entrepreneurship classes so that you understand what is needed to run a successful business and how those things impact/connect to financial performance/financial data.
1. Data analysis - Understanding how to compare/contrast sets of financial data, validate the data and perform trend analysis
2. Technology familiarity e.g. Microsoft Word, Microsoft Excel, Tableau Prep, Tableau
3. Written and verbal storytelling so that you will understand how to crisply communicate your findings, the impact of those findings and your recommendations to the individuals requesting the financial analysis.
4. Communication skills so that you can learn how to ask the right questions so that you can get context behind any changes in the numbers from one time period to the next. Also, these skills will help you frame the questions in a way your audience understands and is willing to help.
5. Statistics - So you can use basic concepts like descriptive statistics (mean, median, mode) progressing to more advanced concepts, as needed for analysis and forecasting
6. Foundational Business Understanding obtained through Economics, Accounting, Marketing, Business Mgt, Entrepreneurship classes so that you understand what is needed to run a successful business and how those things impact/connect to financial performance/financial data.
Thank you! May I ask how challenging is this job?
Teresa
Pat Fullman
Credit Analyst
5
Answers
Arlington, Virginia
Updated