The total U.S. stock market capitalization surpassed $25 trillion in early 2017 - an illustration of how important investments are to the financial strategies of many individuals and corporations in the country. Helping people successfully navigate today’s market are financial analysts. These professionals track the analytics behind stocks, bonds and other investments in order to counsel clients on building and maintaining their portfolios.
Robert Holland, a W. P. Carey School of Business MBA student at Arizona State University, was drawn to the graduate program for its analytical focus, a core concept for financial analysts. “I saw this interesting opportunity where business and technology were combining into what is now known as business analytics,” he says. Holland plans on utilizing the knowledge he gains in the MBA program to improve his performance as a product manager for the loan program at Perpetual Education Fund, a nonprofit.
In any business, especially those in which every dollar is critical, such as Holland’s, the role of financial analyst can prove invaluable. Analysts support business growth by identifying trends in financial data that help senior managers make informed business decisions. These professionals study current and historical economic and business trends to be knowledgeable in both operations and finance.
Earning an MBA can enhance your viability as a candidate for financial analyst opportunities. According to Lawrence Licon, clinical associate professor of finance at ASU, today’s MBA serves as a “career expander” for students. ASU’s fully online Master of Business Administration program can help you grow your skills through a comprehensive curriculum with opportunities to improve leadership as you study business fundamentals used every day in the world of finance. The industry is fast-paced, competitive and ever-evolving as markets change and global events are scrutinized. MBA programs educate students on the skills to make sound business decisions, incorporate data and analytics into their workflows and communicate effectively in high-stress environments.
A typical day in the life of a financial analyst
Providing guidance on investment decisions, a key part of a financial analyst's job, requires you to understand who’s investing the money (the organization) and where the money is going (the financials), so day-to-day work centers on protecting an organization’s future earnings. This is accomplished by reviewing existing data and making informed recommendations for investments. Specific tasks you might perform on an average day include:
- Assessing an organization’s value based on existing financial statements
- Studying marketplace trends, demographics and microeconomic factors specific to the organization's interests
- Suggesting investments to management that are most likely to build company wealth
- Advising on financial choices specific to the organization like issuing bonds or splitting stock
All of these tasks, however, can’t be completed unless you know where you’re starting. Managing an organization’s existing portfolio is just as important for a financial analyst as growing it. To be effective in your role, you need to understand how and where a company has invested its resources and whether these are secure and viable choices to maintain going forward.
A closer look at the professional landscape for a financial analyst
Financial analysts are in demand across many industries because of the assistance they provide an organization. Investment portfolios are becoming more complex and there are more financial products available. As a result, organizations are in need of experienced help to navigate this ever-changing field.
Even now, emerging markets throughout the world are providing new investment opportunities which require specific expertise in those geographic regions. A financial analyst must keep up with these trends, which is why experience and education can make a big difference in the field. This demanding business environment explains the projected growth of 12 percent from 2014 to 2024 in this field, according to the U.S. Bureau of Labor Statistics (BLS). This increase is almost double the national average for all professions.
The median salary for a financial analyst, according to the BLS, is $82,000. However, those with more experience can earn an average of 22 percent more than this median. Promotions that come with experience can be another factor in salary increases. Individuals starting out as financial analysts can potentially move on to a senior-level analyst position, then to finance manager, finance director and possibly even chief financial officer throughout their careers.
Becoming a financial analyst
Competition is strong in this field, even with the projected job growth, but the right education and experience can help give you a boost as an applicant. Having an MBA and additional certifications can improve your prospects of becoming a financial analyst. Hiring managers, especially those conducting interviews for senior-level positions, may prefer candidates with an MBA.
Additionally, certifications can improve job prospects in this field. One example is the Chartered Financial Analyst certification from the CFA Institute,which requires passing three exams, a Bachelor of Arts degree and four years of qualified work experience.
A proven track record of success in the field you wish to enter can also help you to stand out as a job candidate. Your experience can help highlight the skill set hiring managers may be looking for, which can include:
- Knowledge of current financial software such as Excel and more advanced tools like Balanced Scorecard and PrevisionEPM
- Familiarity with enterprise resource planning systems
- Mathematical proficiency
Learn more about your potential career as a financial analyst
Financial analysts take charge, set the direction of an investment strategy and advise clients on how to manage and grow their wealth. They should be strong leaders and quality communicators in order to effectively complete these tasks.
“When you have an MBA, it gives you credibility as a leader and it gives you credibility as a communicator. It kind of gives you the stamp of approval,”says Holland, when asked how his MBA is received by others.
In a competitive, growing finance industry, this “stamp of approval” can be extremely beneficial in the development of your career. Learn how an online MBA from ASU can educate you on the financial skills and analytical tools that may be crucial to pursuing a successful career in finance.