A Complete Guide to Become an Investment Analyst

A Complete Guide to Become an Investment Analyst

For those with a strong background in mathematics as well as analytical and research skills, the financial sector provides a variety of positions, including that of an investment analyst. These experts assist their customers’ financial objectives and portfolios by identifying and recommending investment methods. You may determine if a job fits your professional objectives or interests by learning more about it and the credentials needed for it. In this article, we’ll talk about this line of work, go over some common duties, and walk you through the process of becoming an investment analyst.

Who is an Investment Analyst? 

A person who investigates and evaluates possible investments is known as an investment analyst. Investment analysts advise their customers on whether to purchase, sell, or keep certain assets, as they perform research and analysis on stocks, bonds, commodities, and other assets.

These financial gurus need to have a thorough awareness of the financial markets and the forces that influence them to carry out their operations successfully. They are also masters in spotting and deciphering data trends, creating financial models, and formulating wise suggestions in light of their findings.

Although the work may seem like it involves nothing but mindless analysis and figure crunching, there is much more to it than that. By following industry news, going to conferences, and networking with other experts, investment analysts work hard to remain ahead of the curve.

The top analysts constantly go outside the box, finding fresh data and coming up with creative strategies to outperform the market. Like detectives, they are continually looking for the next big lead. Investment analysts are the best at communicating (both verbally and in person). After all, they are always selling their findings and suggestions to customers, associates, and superiors. They must be able to properly state their investing thesis and back it up with solid justifications.

How to Become an Investment Analyst 

To learn how to become an investment analyst, follow these instructions:

1 – Get a Bachelor’s Degree 

For careers as investment analysts, a bachelor’s degree in a related field is the minimal need for schooling. You may get the financial expertise and information you need for this job via a degree program. Economics, sophisticated mathematics and statistics, corporate finance, and accounting concepts are among the topics covered in the coursework. Using and developing financial models, reading and analyzing data, applying economic concepts, and doing research are just a few of the useful skills you may master in these sessions. Examples of pertinent disciplines are as follows:

2 – Acquire Practical Experience 

You might look for internships to obtain experience in the financial sector while pursuing your degree. You can use the information and abilities you’ve acquired in the classroom in practical situations thanks to this experience. You may assist seasoned investment analysts with their daily activities as an intern or take on some of their repetitive chores yourself. In certain cases, employers utilize internships to find qualified people to hire after graduation.

3 – Opt for Professional Certification 

Typically, being a Chartered Financial Analyst is required to work as an investment analyst (CFA). Your ability to do this profession and comprehend pertinent ethical and financial rules and procedures are both attested to by this certification. A bachelor’s degree, four years of professional experience, or a combination of both totaling four years are prerequisites for enrollment. To complete this certification program, you must pass the following three tests:

  • Level I: There are multiple-choice questions on this test. Your knowledge and comprehension of economics, mathematical techniques, and financial reporting and analysis will be put to the test.
  • Level II: This test consists of multiple-choice questions and case studies. It examines your capacity to apply your knowledge and abilities to numerous real-world scenarios that an analyst can run across, with a particular emphasis on the subject of asset valuation.
  • Level III: This test consists of multiple-choice and essay questions as well as scenario examples. Your capacity to put your understanding of portfolio management and compliance procedures and standards into practice will be tested.

These complex tests might need a significant amount of study time. You may utilize organizations to obtain useful materials, like study guides or practice examinations, and exam sites. Examples are the CFA Society Singapore and the CFA Institute.

4 – Apply For Jobs as an Investment Analyst 

You may look into full-time investment analyst employment in the area you’re interested in to learn about the common requirements businesses look for. Find employment vacancies on corporate websites, social networking sites, online job boards, or by asking others in your professional network. Junior-level analyst roles, which need less professional experience, are often available to recent graduates. Create a unique CV for every job opportunity to demonstrate how your credentials meet the requirements of the individual business.

5 – Keep Gaining Knowledge and Experience 

You may improve your abilities and comfort level in this atmosphere by beginning in junior or entry-level analytic jobs. For the objective of professional growth, your company could provide training sessions or courses. Alternatively, you might look for possibilities for external training to develop specific hard and soft skills that support your professional success, including utilizing certain software to design models or evaluate data. Tell your boss about your professional aspirations so that they may help you by giving you greater duties or introducing you to helpful resources.

6 – Consider Pursuing a Master’s Degree 

You could grow in your work or increase your earning potential by acquiring a graduate degree. While not necessary for entry-level work, businesses looking to fill senior analyst positions or positions at prestigious financial institutions may favor applicants who have this educational background. You may learn advanced business, management, or financial ideas and techniques with these degree programs. Participating in degree programs also gives you the chance to network with like-minded people in your industry. Look for degree programs in this area, such as Business Administration Master’s (MBA), Finance Master of Science, or Quantitative Finance Master’s Degree

Responsibilities of an Investment Analyst 

An investment analyst gathers information, does research, and analyzes assets like stocks, bonds, currencies, and commodities. To become authorities in their chosen disciplines, investment analysts may concentrate on certain specialties, such as a particular sector, an area of the world, or an asset class. Before final recommendations and investment choices are made, the study is then given to portfolio or investment managers, often as a team in which specialists from other professions may compare their findings. Presentations, information exchange among colleagues, and collaboration are essential components of the profession.

An investment analyst regularly gathers and analyzes data, including financial statements from companies, price changes, currency conversions, and yield changes. Macro developments such as monitoring a nation’s political sea changes, climatic change, the effects of natural catastrophes, and rising industries and service sectors are also included in the information collecting process.

When an investment analyst interacts with the management of the company they are analyzing or other important key figures, there is often some amount of direct connection. Additionally, they could meet with traders on the stock market, investment managers, and stockbrokers. Many investment analysts travel regularly, and they could stay in a foreign country for a while to develop their professional networks and gain local expertise.

Requirements to Become an Investment Analyst

When it comes to the prerequisites for becoming an investment analyst, there is no one size fits all solution. However, some of the most typical demands are as follows:

  • an undergraduate degree in finance, economics, accounting, or a comparable discipline
  • 1-3 years of financial sector experience Proven analytical and problem-solving abilities
  • Excellent presentation and communication abilities
  • mastery of Microsoft Office, particularly Excel
  • knowledge of financial modeling
  • meeting deadlines and working successfully under pressure
  • A master’s degree in business administration (MBA) or the credential of Chartered Financial Analyst (CFA) may be necessary or recommended in some circumstances.


According to Payscale.com in May 2021, the current median compensation for investment analysts is a little over $66,000. It is usual to have bonus and profit-sharing arrangements, with bonuses up to $21,000 and profit-sharing up to $13,000. Additionally disclosed are commissions up to $4,000 yearly.

The larger percentage of respondents who identified as entry-level in Payscale.com’s poll may help to explain why the U.S. Bureau of Labor Statistics (BLS) estimates the median wage at $83,660 in May 2020. The pay scale changes significantly as one gains experience. Entry-level earnings are normally around $60,000, but after six, ten, or twenty years of experience, they approach $100,000.

According to Payscale, those with over 20 years of experience may expect compensation of $140,000. A crucial factor is geographic location. While earnings in Washington, Philadelphia, and Seattle are noticeably lower than average, salaries in New York City, San Francisco, Boston, and Denver are all over 20% more than normal.

Necessary Skills to Become an Investment Analyst 

The most vital tool for a financial analyst is an analytical mind with a great grasp of mathematical connections and patterns. The investment analyst adds value to the organization by having the capacity to see trends before others do and by utilizing specialized knowledge to develop methods to profit from them.

Other crucial abilities include having a sharp eye for detail and the capacity to make wise decisions under time constraints. When unexpected market developments occur, an investment analyst must be prepared to react promptly with fresh suggestions.

As most of the job is done on computers, being computer literate and having the capacity to create sophisticated predictive models is unquestionably advantageous.

Since the position requires both figure crunching and effective communication, strong interpersonal and presentational abilities are essential. Creating polished presentations with graphs and charts to display the facts and communicate persuading ideas takes up a significant chunk of the workweek.

Career Path of Investment Analysts

Moving into a senior investment analyst post (median pay around $85,000 in 2021) or a portfolio manager position (median income around $87,000, with significant incentives and profit sharing) is the most typical career path.

Senior portfolio managers (median salary: about $124,000 plus bonuses and profit-sharing) or chief investment officers (CIOs) (median salary: approximately $170,000 in 2021 plus bonuses and profit-sharing) are the next two positions.

Other investment analysts go on to become independent investment consultants and provide their services on a contract basis to financial institutions. Only after many years of practice and the creation of a network of business connections is this alternative accessible.

Employment Rate of Investment Analysts

The majority of investment analysts are employed by bigger businesses like investment banks, insurers, institutional investors, private equity firms, stockbrokers, or significant nonprofit organizations. In this industry, benefits including health, dental, and retirement plans are almost commonplace.

The BLS projects a 5% growth rate in employment for investment analysts through the year 2029, which indicates good career prospects for this profession. With 12-hour days and required weekend labor, working hours may be severe, albeit the amount of this is affected by local customs. However, as was already said, the majority of investment analysts express great levels of work satisfaction.

There is a gender gap at the entrance level, with males significantly outnumbering women. Higher up in the organizational structure, this tendency starts to level off a little. The causes of the imbalance are less obvious. One reason is that men often outperform girls on arithmetic standardized examinations, which is probably related to cultural norms.


For those wishing to pursue a career in the financial sector, particularly in investment, the job descriptions and career prospects for investment analysts are favorable. The job description calls for a person who can perform well under pressure, collaborate well with the team, and, if necessary, demand to work on holidays. A pressure analyst profile offers a high degree of professional advancement and work satisfaction. Additionally, analysts are required in the day-to-day operations of many big businesses including investment banks, financial institutions, insurance companies, and brokers. People with the necessary skill set and degree of education may get their profiles in front of portfolio managers.

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