Financial analyst - Definition and Overview

A financial analyst (or research analyst, equity analyst, Wall Street analyst) work with financial analysis. They're sometimes referred to as Wall Street analysts, just as financial firms are sometimes referred to as Wall Street firms.

Job

An analyst will write reports on the companies they are supposed to cover, trying to describe the businesses and their opinion of the companies investment potential, usually from a fundamental analysis standpoint. They also summarize that report with a rating, such as "buy", "sell", "market perform", "overweight", "hold", etc.

The analysts get their information by studying public records of the company and by participating in public conference calls where they can ask direct questions to the management. Previously, analysts were said to obtain lots of information (especially from clients of their investment bank), via exclusive meetings with upper management. Regulation FD (Full Discolusure), is said to prevent most of this from happening at present.

Education

Most of the analysts have a master of business administration education. At least the "senior" analysts.

Skills

Some analysts will advance to become a part of senior management in a "Wall Street" firm. Sallie Krawcheck that after school went to work as an analyst for Sanford Bernstein (in 2005 a unit of Alliance Capital Management Holdings) was promoted to CFO of Citigroup in November, 2004.

Financing

The research department don't have the ability to bring in nearly enough money to be a self-sustaining research company. The research analysts department is therefore always a unit of an investment or investment advisory firm. Since 2002 there have been an extra effort to overcome perceived conflicts of interest between the profitable investment part of the firm, and the not so profitable analysis part of the firm that is expected to provide objective and independent research.

Scandals

The 2002 Wall Street scandal arose from percevied biased research analysis. See also the "global settlement" of late 2002.

External links

• StarMine - Highlighting the Best Analyst Research (http://www.starmine.com/)
• newratings.com - full analyst news coverage (http://www.newratings.com/)
• Forbes.com - Wall Street's Top Analysts (http://www.forbes.com/lists/2004/04/28/04starmineland.html)

Articles

• FT.com / Industries / Financial services - Bank of America fires analyst over photograph - January 14 2005 (http://news.ft.com/cms/s/72eec482-6684-11d9-8055-00000e2511c8.html) (Bank of America's investment bank fires Andrew Susser and Joel Krasner)