Financial analysis is an aspect of the overall business finance function that involves examining historical data to gain information about the current and future financial health of a company. Certifications, such as the Chartered Financial Analyst certification from the CFA Institute, may also improve the chances of advancement in the field. According to the Bureau of Labor Statistics, the demand for financial analyst jobs is projected to grow 16 percent through 2022. In addition, the growth of emerging markets on a global basis is expanding, and financial expertise is needed in specific geographic regions.
Top five fields employing financial analysts are financial investment, financial management, science and technology, insurance and credit intermediation. Financial analysts study trends in companies, investment products and the economy. Most financial analysts focus on either buying or selling investments, so they are called buy-side or sell-side analysts.
Financial analysts are normally based in offices, but they also travel to consult with clients and investigate companies with investment potential. They spend a large portion of office hours meeting people or speaking on the telephone, which leaves their analysis and research work for evenings and weekends. Frequently under stress from deadlines, most analysts work full-time, and overtime is routine. The average financial analyst earned $87,740 per year as of 2011, based on 52 40-hour weeks, according to the Bureau of Labor Statistics.
The BLS expects a 23 percent increase in analyst jobs between 2010 and 2020, compared to a 14 percent average for all jobs. The growing complexity of financial products and a need for expertise in global markets will create more analyst positions. Financial analysts with certifications or master’s degrees also have the best chances of career advancement. For example, some analysts advance to portfolio manager positions, which give them the responsibility for selecting a portfolio’s investments and supervising other analysts. Other analysts become fund managers, responsible for buy and sell decisions for mutual funds or hedge funds.
This chart describes the expected percentage of people who perform the job of Financial Analyst I in the United States that make less than that annual salary. For example the median expected annual pay for a typical Financial Analyst I in the United States is $52,299, so 50% of the people who perform the job of Financial Analyst I in the United States are expected to make less than $52,299. You don’t need to earn a degree in Finance to land a job as a financial analyst.