Detailed Guide forFinancial Analysts in California
May also be called: Credit Products Officers; Equity Research Analysts; Investment Analysts; Operational Risk Analysts; Planning Analysts; Portfolio Analysts; Real Estate Analysts; and Securities Analysts
What Would I Do?
Financial Analysts evaluate investment opportunities. They work in banks, pension funds, mutual funds, securities firms, insurance companies, and other businesses. They provide guidance to businesses and individuals making investment decisions. They assess the performance of stocks, bonds, and other types of investments.
Financial Analysts are typically divided into two categories: Buy-side Analysts and Sell-side Analysts. Buy-side Analysts develop investment strategies for companies that have a lot of money to invest. These "institutional investors" include mutual funds, hedge funds, insurance companies, independent money managers, and nonprofit organizations with large endowments, such as some universities. Sell-side Analysts advise financial services sales agents who sell stocks, bonds, and other investments. Some Financial Analysts work for the business media and remain impartial, falling into neither the buy-side nor the sell-side specialties.
Financial Analysts generally focus on trends affecting a specific industry, geographical region, or type of product. They must understand how new regulations, policies, and political and economic trends may affect investments. With the globalization of investing, they must also understand the language, culture, business environment, and political conditions in the country or region in which they specialize.
Tools and Technology
Financial Analysts use a variety of tools and technology in their work. They use computers, tablets, smart phones, and calculators. They use software such as analytical or scientific, financial analysis, information retrieval or search, and spreadsheet applications.
Important Tasks and Related Skills
Each task below is matched to a sample skill required to carry out the task.
|View the skill definitions|
|Task||Skill Used in this Task|
|Draw charts and graphs, using computer spreadsheets, to illustrate technical reports.||Critical Thinking|
|Inform investment decisions by analyzing financial information to forecast business, industry, or economic conditions.||Economics and Accounting|
|Monitor developments in the fields of industrial technology, business, finance, and economic theory.||Written Comprehension|
|Interpret data on price, yield, stability, future investment-risk trends, economic influences, and other factors affecting investment programs.||Deductive Reasoning|
|Monitor fundamental economic, industrial, and corporate developments by analyzing information from financial publications and services, investment banking firms, government agencies, trade publications, company sources, or personal interviews.||Inductive Reasoning|
|Recommend investments and investment timing to companies, investment firm staff, or the public.||Oral Expression|
|Determine the prices at which securities should be syndicated and offered to the public.||Mathematical Reasoning|
|Prepare plans of action for investment, using financial analyses.||Written Expression|
|Evaluate and compare the relative quality of various securities in a given industry.||Judgment and Decision Making|
Below is a definition for each skill.
|View the tasks to skills list|
|Critical Thinking||Using logic and reasoning to identify the strengths and weaknesses of alternative solutions, conclusions or approaches to problems.|
|Economics and Accounting||Knowledge of economic and accounting principles and practices, the financial markets, banking and the analysis and reporting of financial data.|
|Written Comprehension||The ability to read and understand information and ideas presented in writing.|
|Deductive Reasoning||The ability to apply general rules to specific problems to produce answers that make sense.|
|Inductive Reasoning||The ability to combine pieces of information to form general rules or conclusions (includes finding a relationship among seemingly unrelated events).|
|Oral Expression||The ability to communicate information and ideas in speaking so others will understand.|
|Mathematical Reasoning||The ability to choose the right mathematical methods or formulas to solve a problem.|
|Written Expression||The ability to communicate information and ideas in writing so others will understand.|
|Judgment and Decision Making||Considering the relative costs and benefits of potential actions to choose the most appropriate one.|
Most Financial Analysts work in offices at large financial institutions in major financial centers. Their offices are often equipped with the latest in technology. Most work full time, but due to the nature of the work, many put in additional hours and some work 50-70 hours a week. They must do the majority of their research after office hours because their days are often filled with telephone calls and meetings. Financial Analysts frequently travel to visit companies or potential investors. This work is fast-paced with pressure to meet deadlines, which can be stressful.
Financial Analysts are expected to wear corporate dress attire. They are also frequently expected to network with others in the profession. Wardrobe expenses and socializing with clients can be costly. Financial Analysts spend the majority of their day sitting at a desk in front of a computer, so they must take proper precautions to avoid repetitive motion stress injuries.
Financial Analysts are not typically members of a union.
Will This Job Fit Me?
The job of Financial Analyst may appeal to those who enjoy activities that involve following set procedures and routines. The Financial Analyst occupation involves working with data and details more than with ideas. Individuals who are results-oriented and value feelings of accomplishment should enjoy working in this occupation.
Employers seek applicants with good analytical and organizational skills as well as the ability to make decisions and recommendations. Financial Analysts need strong verbal and written communications skills and should work well both independently and on a team. They must also be self-motivated, detail-oriented, and flexible about changing priorities.
What Wages and Benefits Can I Expect?
Wages vary by geographic location, employer, level of education, and experience. Financial Analysts may also earn bonuses, which are usually awarded based on successfully forecasting investment performance. These bonuses can be a significant part of a Financial Analyst's total earnings.
The median wage in 2016 for Financial Analysts in California is $96,788 annually, or $46.53 hourly. The median is the point at which half of the workers earn more and half earn less.
Most Financial Analysts receive medical, dental, and life insurance, as well as vacation, sick leave, and retirement plans from their employers.
What is the Job Outlook?
The Financial Analyst occupation is expected to see high employment growth in California. A growing range of financial products is expected to fuel the demand. Financial Analysts will need in-depth knowledge of geographic regions to take advantage of new investment opportunities in emerging world markets.
Recent regulatory reform should allow the financial industry to grow at a similar rate as in previous decades, but restrictions on trading by banks may shift some jobs from investment banks to hedge funds and private equity groups.
Projections of Employment
In California, the number of Financial Analysts is expected to grow much faster than average growth rate for all occupations. Jobs for Financial Analysts are expected to increase by 23.1 percent, or 7,400 jobs between 2012 and 2022.
|Estimated Employment and Projected Growth|
(Estimated Year-Projected Year)
Due to Net
|View Projected Growth for All Areas|
Annual Job Openings
In California, an average of 740 new job openings per year is expected for Financial Analysts, plus an additional 780 job openings due to net replacement needs, resulting in a total of 1,520 job openings.
|Estimated Average Annual Job Openings|
|Jobs From Growth||Jobs Due to|
|View Data for All Areas|
How Do I Qualify?
Education, Training, and Other Requirements
Employers require at least a bachelor's degree in a business-related field, such as accounting, business administration, economics, finance, or statistics. Advanced positions require a master's degree in finance or business administration. Coursework in accounting policies and procedures, corporate budgeting, and financial analysis methods is required. It is also important that Financial Analysts have knowledge of options pricing, bond valuation, and risk management.
Most employers require three to five years of related experience in finance or accounting. Internships provide practical, hands-on experience and can supplement what prospective Financial Analysts have learned in the classroom.
Early Career Planning
High school students interested in this kind of work should take classes in mathematics, history, economics, business, and language arts. Related training programs are also available through Regional Occupational Programs (ROP) in areas such as business, accounting, and finance. To find an ROP program near you, go to the California Association of Regional Occupational Centers and Programs Web site.
Financial Analysts must stay current on the latest developments in such a specialized field by frequently attending training seminars and keeping up to date on the general economic climate. In addition, credential holders may be required to complete annual continuing education credits to maintain certification.
Licensing and Certification
The Financial Industry Regulatory Authority (FINRA) is the main licensing organization for the securities industry. It requires licenses for many Financial Analyst specialties. Most of the licenses require sponsorship by an employer, so companies do not expect individuals to have these licenses prior to employment.
Certification is not required to work as a Financial Analyst, but it is often recommended by employers and can improve opportunities. There are a number of different certification programs available through professional associations and training institutions. One such certification is the Chartered Financial Analyst (CFA), which is certified by the CFA Institute. To qualify, Financial Analysts must have a bachelor's degree and four years of experience as well as be able to pass three exams. Another certification is the distinguished American Academy of Financial Management (AAFM) Designations and Credentials. To be certified, the candidate must pass six different levels of standards and possess a graduate-level portfolio of skills and knowledge. Financial Analysts can also become certified in their field of specialty. For more information, go to the U.S. Department of Labor's Career InfoNet Web site and scroll down to "Career Tools." Click on "Certification Finder" and follow the instructions to locate certification programs.
Where Can I Find Training?
There are two ways to search for training information:
- Search by Field of Study to find what programs are available and what schools offer those programs. You may use keywords such as: Business/Management, Finance, and Investments.
- Search by Training Provider to find schools by name, type of school, or location.
Contact the schools you are interested in to learn about the classes available, tuition and fees, and any prerequisite course work.
Where Would I Work?
The largest industries employing Financial Analysts are as follows:
|Industry Title||Percent of Total Employment for Occupation in California|
|Other Financial Investment Activities ||16.5%|
|Management of Companies and Enterprises ||11.6%|
|Management & Technical Consulting Svc ||11.3%|
|Depository Credit Intermediation ||6.0%|
|Security & Commodity Investment Activity ||5.5%|
Finding a Job
Direct application to employers remains one of the most effective job search methods. Networking is also important in this occupation, since many Financial Analysts find work through referrals. Jobs can also be found through newspaper classified advertisements, online job boards, college career centers, and professional organizations. Online job opening systems include JobCentral at www.jobcentral.com and CalJOBSSM at www.caljobs.ca.gov.
To find your nearest One-Stop Career Center, go to Service Locator. View the helpful job search tips for more resources. (requires Adobe Reader).
Yellow Page Headings
You can focus your local job search by checking employers listed online or in your local telephone directory. Below are some suggested headings where you might find employers of Financial Analysts.
- Financial Planning Consultants
- Financial Services
- Insurance Carriers
- Investment Management
- Investment Securities
- Mutual Funds
- Pension & Profit Sharing Plans
Find Possible Employers
To locate a list of employers in your area, go to "Find Employers" on the Labor Market Information Web site:
- Select one of the top industries that employ the occupation. This will give you a list of employers in that industry in your area.
- Click on "View Filter Selections" to limit your list to specific cities or employer size.
- Click on an employer for the street address, telephone number, size of business, Web site, etc.
- Contact the employer for possible employment.
Where Could This Job Lead?
Financial Analysts typically start by focusing in a specific investment field. As they gain experience and become senior Financial Analysts, they can become portfolio managers or fund managers. A master's degree in finance or business administration can improve a Financial Analyst's chances of advancing into one of these positions. They may also become independent consultants who work under contract with a number of investors.
Below is a list of occupations related to Financial Analysts with links to more information.
|Accountants and Auditors||Guide|
|Personal Financial Advisors||Profile|
|Tax Examiners and Collectors, and Revenue Agents||Profile|
These links are provided for your convenience and do not constitute an endorsement by EDD.
For the Career Professional
The following codes are provided to assist counselors, job placement workers, or other career professionals.