Investment analyst: Job description

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Investment consultant: Jo

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An investment analyst undertakes research to provide information and investment ideas to fund managers. The information that analysts provide enables fund managers to make decisions relating to the investment portfolios they manage.

Some analysts work for investment management companies, providing information to in-house fund managers; others work for stockbrokers and investment banks, where their research assists their employer's clients, usually fund managers/hedge funds.

Analysts and fund managers working in the UK may research investments globally. The principal UK investors (apart from individuals) are:

pension funds;
life assurance companies;
unit trusts;
investment trusts;
banks and major companies;
hedge funds.

Typical work activities

Investment analysts may be involved in a broad range of activities and disciplines, which vary according to the nature of the employer. Essentially, they need to develop an understanding of financial information, such as:

company accounts;
sector data;
statistics;
economics;
relevant political events.

They must also develop expertise in interpreting such information and the implications it has for investment decisions.

An analyst may have a set of companies to research and get to know in depth in order to make informed recommendations to fund managers. These are usually companies in a specific industrial sector, such as retail, pharmaceuticals or utilities, or in a specific geographical area, such as Europe or East Asia.

Work activities usually include:

analysing financial information relating to specific companies, e.g. company results, profit and loss and cash flow statements;
regular communication with the management of the companies and their investor relations team, usually over the telephone but sometimes at their premises, e.g. at company result meetings;
keeping up to date with market developments, new investment products and all other areas that can affect the markets, e.g. movements in the economies of relevant countries;
considering how the economic implications of factors such as natural disasters, weather, wars, etc. might affect the performance of companies and funds;
monitoring the financial news using specialist media sources;
writing research reports and investment ideas to be sent to clients;
ensuring that they meet the numerous compliance regulations;
maintaining regular communication with clients by telephone, email and in person, including updating fund managers/hedgefunds on investment ideas and summaries of research;
making presentations and recommendations as to which funds should be included in fund managers' portfolios.