Equity Analyst, also known as Equity Research Analysts are professionals responsible for examining financial data and providing viable investment opportunity recommendations to companies.<\/p>\n
While some analysts work in-house to assist their employers make good investments, others are hired as third-party consultants to lend their expertise.<\/p>\n
Equity Analysts are one branch of the whole tree of financial analysts. Some financial analysts look at the overall picture, analyze the general market trends and locate profitable investments in different industries and market segment.<\/p>\n
While some break the investment opportunities into bits, company-by-company, trying to identify the investment potential of each of these companies. Professionals who do these are known as equity research analysts.<\/p>\n
So, if you want to become an equity research analyst, this article is for you, as it contains all you need to know about becoming an equity analyst.<\/p>\n
RELATED ARTICLE: Certified Financial Analyst: Definition, Requirements, Fees, Salary (+ quick tips)<\/a><\/p>\n Equity analysis is the process of analysing a companies fundamentals, financial statement analysis, and financial modeling for equity recommendations.<\/p>\n Equity analysis, also known as equity research deals with commodities and bonds. It offers macroeconomic views and derivatives analysis when required by working with the derivatives division of the brokerage firm.<\/p>\n Sell-side analysts work for brokers who sell shares to the investors (mainly fund management firms and private clients). While buy-side analysts on the other hand work for fund management firms.<\/p>\n The main goal of equity research is to provide in-depth analysis of a sector, company or stock, and to use this information in assisting investors in allocating their funds properly.<\/p>\n In general, you can say that equity research involves studying a company\u2019s finances to see how strong its core business operations are.<\/p>\n An equity analyst is an individual who is responsible for providing analysis, recommendations, and reports on viable investment opportunities that financial institutions and investors are likely to be interested in.<\/p>\n Equity analysts start by doing financial modeling and analysis and are responsible for covering a group of companies or a particular sector. They produce research reports, projections, and recommendations about companies and stocks.<\/p>\n Typically, an equity analyst focuses on a small group of companies in a particular industry to develop the high-level expertise needed to make accurate projections in the financial sector. More so, they monitor market data and news reports to update their research daily.<\/p>\n In addition to all these, equity analysts issue buy, sell, or hold recommendations to potential investors.<\/p>\n In a big firm, associates and junior equity analysts are often recognized for their work by naming their findings in research reports that are distributed through the company\u2019s media channels.<\/p>\n While senior analysts on the other hand are often sought after by media channels to comment on released reports of the company\u2019s earnings.<\/p>\n RELATED ARTICLE: Financial Officer: The Complete Guide(+ Free tips)<\/a><\/p>\n Generally, equity research analysts are responsible for providing reports, analyses, and recommendations of the best securities that investors are likely to be interested in.<\/p>\n Hence, their responsibilities include but are not limited to the following;<\/p>\n Furthermore, equity research analysts work full-time. It can be compared to what it\u2019s like to be a university student, as there are lots of \u201cassignments\u201d and \u201cpaperwork\u201d due with regular deadlines. Hence, they are required to have lots of skills.<\/p>\n The journey to becoming a good equity analyst starts from high school where you learn basic art subjects like Economics, Accounting, Maths and other related subjects.<\/p>\n After high school, you can proceed to get a bachelor\u2019s degree in a relevant business discipline such as finance, economics, accounting, or business administration.<\/p>\n You can also opt for undergraduate degrees that provide in-depth quantitative training such as degrees in Mathematics, Statistics, Engineering, and other relevant subjects.<\/p>\n Conversely, a Master\u2019s degree is not required to advance into senior analyst positions. However, having one could pave the way to advance to fund management positions.<\/p>\n Another way to begin your career as an equity analyst is to apply for internship positions. As it serves as a good way to get your feet to the door of any top financial firm and learn all you need to know.<\/p>\n In general, the equity analyst field is highly competitive. So, having a degree from a top school can make your application more valid.<\/p>\n READ ALSO: FINANCIAL ANALYST: Meaning, Requirements, Skill, Salary, ( +free Employment tips)<\/a><\/p>\n Some junior analysts work for several years and then return to school to earn a Master\u2019s degree.<\/p>\n Although a Master\u2019s degree is not compulsory to advance up the career ladder. It\u2019s still needed if you want to advance up to senior funds management roles.<\/p>\n A senior equity research analyst who has a high level of expertise in his or her area, and has a Masters\u2019s degree can move into an investment management role. This position allows you to manage the investment of people and their investment portfolio.<\/p>\n An investment portfolio manager is responsible for using the information supplied by a junior analyst to manage the mix of securities in a portfolio daily.<\/p>\n The predominant professional qualification for equity research analyst and others managing securities is the Chartered Financial Analyst (CFA) designation, from the CFA Institute.<\/p>\n To get this qualification, candidates are required to have a minimum of four full years of qualifying experience. And pass a series of three examinations.<\/p>\n More so, its often considered as a qualification needed for advancement into senior positions in the field.<\/p>\n In addition to this, most equity research analysts require operating license from the Financial Industry Regulatory Authority (FINRA), a national body that manages securities firms and brokers.<\/p>\n Buy-side analysts work for fund managers at financial advisory firms. The research company\u2019s portfolio, as well as other companies that may pose as profitable investment opportunities.<\/p>\n Results from this research enable them to prepare reports that offer buy and sell recommendations to the management.<\/p>\n While sell-side\u00a0equity analysts often work for big\u00a0investment banks, such as Goldman Sachs.<\/p>\n Their jobs involve researching the financial fundamentals of companies the bank is considering taking public. Determining which ones have the strongest potential to become profitable.<\/p>\nWhat is Equity Analysis?<\/span><\/h2>\n
Who is an Equity Analyst?<\/span><\/h2>\n
What does an Equity Research Analyst do?<\/span><\/h3>\n
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How Can I Become An Equity Analyst?<\/span><\/h2>\n
Advanced Positions in Equity Research <\/span><\/h3>\n
Qualifications for an Equity Research Analyst<\/span><\/h3>\n
Buy-Side and Sell-Side Analysts<\/span><\/h2>\n