How to Become A Financial Analyst

If you think reaching the pinnacles of the finance industry can be done as easily as Jordan Belfort (think The Wolf of Wall Street), then think again. Becoming a financial analyst takes hard work, dedication and an investment of time dedicated to the profession. However, with the right guidance and information, you can increase your prospects of becoming a financial analyst.

Skills You’ll Need to Be a Financial Analyst

Financial analysts are responsible for evaluating investment opportunities. They work in environments such as pension funds, securities firms, mutual funds, insurance companies and banks.

Getting degree in finance or Accounting might help you increase your chances of getting an entry-level job in the finance sector, but you will have to acquire these skills for possible career advancement.

• Confident Decision Maker—making predictions, giving advice, making judgment calls are all part of the everyday work of a financial analyst. As a financial analyst, you’ll have to make the harsh calls as well as handle the tough losses.


• Skilled Researcher—research and analysis will be the biggest and most important ability in your skill-set.


• Effective Marketer—being good at what you do isn’t enough now, convincing others that you’re their best bet will be a crucial key to your success.


• Critical Thinker—reasoning and logic will have to be used to identify the pros and cons of problems, solutions and conclusions.


• Persuasion—just having a good plan isn’t going to get your stock sold; the ability to convince people to invest their money based on your forecasts can be your biggest asset.

The Educational Road Map

The path of working towards becoming a financial analyst has a number of stages. Hence, the sooner you start the better.

Step1—Get an Early Start

If you’re looking for a career in finance then you need to have the math down pat. Taking certain subjects in high school will be able to make the transition to college finance subjects relatively smoother.

• AP Mathematics
• Accounting
• Economics
• Business

Step 2—Get the Right Degree

While people will repeatedly tell you that a bachelor’s degree in https://www.higheredu.com/business/finance">finance will be sufficient to qualify for a position as a financial analyst. This may not always hold true.

Studies show that students with a bachelor’s degree are usually only able to become eligible for junior analyst positions, while students with an MBA will be able to have good prospects for  senior analyst roles right out of business school.

So, your degree options are:

• Bachelor’s degree in Finance
• Master’s in business Administration (MBA)
• Master’s degree in Finance

Courses in subjects such as options pricing, bond valuation, risk management and trading laws are especially important.

Step3—Get Certified

Like most other careers, in finance, your educational journey does not end at graduation.

Most successful financial analysts choose to apply for the Chartered Financial Analyst (CFA) Certification. It is currently the most recognized and respected investment designation in the world.

While many colleges and universities teach finance courses, the CFA course combines both the theories and practical aspects of financial analysis. It includes instruction on topics such as:

• Financial Analysis and Reporting
• Corporate Finance
• Equity Investments
• Fixed Income
• Derivatives
• Portfolio Management
• Wealth Management

What to Expect on the Job

By trading in millions of dollars of investments every day, financial analysts develop a keen work ethic which is further supported by their duties on the job.

As a financial analyst, you will be expected to regularly:

• Research economic and business trends
• Evaluate historical and current data to make stock market predictions
• Collaborate with company officials to gain insight into the company’s management and investment expectations
• Recommend individual investments as well as portfolios investments
• Explain recommendations to investors
• Actively read publications such as The Economist, The Financial Times and The Wall Street Journal - which is widely considered the bible of financial analysts

Some financial analysts may be required to travel extensively as part of their job requirements. This travelling requires analysts to inspect the financial worth of companies and investment opportunities even when they are on the opposite side of the world.

Picking a Financial Specialty

Advancement in the field of financial analysis comes with experience and specialization. A financial analyst’s job description can greatly vary based on the type of investments they are dealing with and the level of detail in the evaluation they carry out.

• Portfolio managers are the literal managers of a team of financial analysts who work for a large corporation or company. The team is responsible for determining the right markets, products, portfolios and industries that the company should profitably invest in.


• Risk analysts work is solely based on the evaluations aspect of an investment. They determine how to limit potential loss and manage risk and unpredictability in an investment.


• Fund managers must be highly adaptable to changing market conditions as they make split-second buying and selling decisions for their clients. They work exclusively with hedge funds and mutual funds.


• Ratings analysts are responsible for evaluating the ability of governments and companies to pay off their payables and debts. On the basis of evaluating the ratings, the organization’s future debt is controlled.

Tips for Success

If you are currently employed as a junior analyst, then proficiency in the use of financial software, spreadsheets, databases, presentations can help you in qualifying for senior analyst positions sooner, rather than later.

For senior analysts however, the focus on expertise comes from management and leadership roles within the company. They are expected to mentor junior analysts and have strong interpersonal relationships with superiors.

According to management consultant Peter Drucker, “Effective leadership is not about making speeches or being liked; leadership is defined by results not attributes” - and the senior analyst who provides the best results is more likely be asked to provide leadership.

The Bottom Line

The U.S. Bureau of Labor Statistics (BLS) predicted a 16% increase in job growth for financial analysts between 2012 and 2022. In May 2012, the median annual wage for financial analysts was $76,950, while the top 10 percent in the financial analyst profession earned more than $148,430.

A career as a financial analyst will require both preparation and hard work. However, the results can not only possibly bring financial benefits but also the satisfaction that will come by being an important part of the business landscape.

States with the highest employment level in this occupation:

Source: bls.gov

How to Become a Financial Analyst in Texas?

To become a Financial Analyst in Texas, you will need at least a 4-year Bachelor’s degree in Finance, Business Administration, https://www.higheredu.com/business/accounting">Accounting , https://www.higheredu.com/business/economics">Economics or Statistics. This will help you get an entry-level job in an investment bank, insurance company, mutual fund, hedge fund or a securities firm. Many companies run in-house training programs to prepare their human resource for senior analyst and management positions. You can also go for professional certifications to enhance your skills and brighten your career prospects.

How to Become a Financial Analyst in California?

To become a Financial Analyst in California, you need a 4-year Bachelor’s degree in Business Administration, Accounting, Economics, Finance or Statistics. This will help you get an entry-level position with an insurance company, investment bank, securities firm, mutual fund, hedge fund, etc. Companies run in-house training programs whereby they induct fresh graduates with the aim of preparing them for senior analyst positions and leadership roles in future. Also, you can obtain professional certifications to update your skill set and enhance career prospects.

How long does it take to complete a degree in Financial Analysis?

In order to obtain the role of a financial analyst in organizations, students need to complete their undergraduate or master's degrees first. They can enroll in an intensive bachelor's degree in Finance that takes 4 years to complete or an advanced master's degree in Finance/MBA program, which takes approximately 1-2 years to complete. Apart from full time courses, many accredited online courses are also offered by universities. Students may also go for an associate’s degree, which takes 2 years to complete and often serves as a precursor to a bachelor’s degree.

What are the requirements to complete a degree in Financial Analysis?

In order to enroll in an advanced master’s degree in Finance, students are required to have a bachelor’s degree in a relevant area of study. Some institutes also ask for GMAT along with the admission application for the master's program. In order to obtain their finance degrees, students are expected to complete the required credit hours, take lectures, study the modules, work on projects/assignments, clear all exams and submit a final thesis project.

How much can I make after completing a degree in Financial Analysis?

According to the US Bureau of Labor Statistics, the annual median pay of Financial Analysts was $85,660 in 2018. The number of jobs in this field in 2016 was 296,100. Also, the employment of Financial Analysts is predicted to grow by 11%, which is much faster than the average rate for all other professions. Thus, the job prospects in this field are very bright.