A financial analyst , securities analyst , research analyst , equity analyst , or investment analyst is a person who performs financial analysis for external or internal clients as a core part of the job . Writing reports or notes expressing opinions is always a part of `` sell-side '' -LRB- brokerage -RRB- analyst job and is often not required for `` buy-side '' -LRB- investment firms -RRB- analysts . Traditionally , analysts use fundamental analysis principles but technical chart analysis and tactical evaluation of the market environment are also routine . Often at the end of the assessment of analyzed securities , an analyst would provide a rating recommending an investment action , e.g. to buy , sell , or hold the security . The analysts obtain information by studying public records and filings by the company , as well as by participating in public conference calls where they can ask direct questions to the management . Additional information can be also received in small group or one-on-one meetings with senior members of management teams . However in many markets such information gathering became difficult and potentially illegal due to legislative changes brought upon by corporate scandals in the early 2000s . One example is Regulation FD -LRB- Fair Disclosure -RRB- in the United States . Many other developed countries also adopted similar rules . Financial analysts are often employed by mutual and pension funds , hedge funds , securities firms , banks , investment banks , insurance companies , and other businesses , helping these companies or their clients make investment decisions . Financial analysts employed in commercial lending perform `` balance sheet analysis , '' examining the audited financial statements and corollary data in order to assess lending risks . In a stock brokerage house or in an investment bank , they read company financial statements and analyze commodity prices , sales , costs , expenses , and tax rates in order to determine a company 's value and project future earnings . In any of these various institutions , the analyst often meets with company officials to gain a better insight into a company 's prospects and to determine the company 's managerial effectiveness . Usually , financial analysts study an entire industry , assessing current trends in business practices , products , and industry competition . They must keep abreast of new regulations or policies that may affect the industry , as well as monitor the economy to determine its effect on earnings . Financial analysts use spreadsheet and statistical software packages to analyze financial data , spot trends , and develop forecasts ; see Financial modeling . On the basis of their results , they write reports and make presentations , usually making recommendations to buy or sell a particular investment or security . Senior analysts may actually make the decision to buy or sell for the company or client if they are the ones responsible for managing the assets . Other analysts use the data to measure the financial risks associated with making a particular investment decision . Financial analysts in investment banking departments of securities or banking firms often work in teams , analyzing the future prospects of companies that want to sell shares to the public for the first time . They also ensure that the forms and written materials necessary for compliance with Securities and Exchange Commission regulations are accurate and complete . They may make presentations to prospective investors about the merits of investing in the new company . Financial analysts also work in mergers and acquisitions departments , preparing analyses on the costs and benefits of a proposed merger or takeover . There are buy-side analysts and sell-side analysts . Some financial analysts collect industry data -LRB- mainly balance sheet , income statement and capital adequacy in banking sector -RRB- , merger and acquisition history and financial news for their clients . They normally standardize the different companies data to look uniform and facilitate their clients to do peer analysis . Their main objective is to enable their clients to make better decisions about the investment across different regions . They also provide the abundance of financial ratios calculated from the data that they gather from the financial statements that help clients to read the bottom line of the company . Many people mix up this with the data entry job but actually its far away from just data entry . Some financial analysts , called ratings analysts -LRB- who are often employees of ratings agencies -RRB- , evaluate the ability of companies or governments that issue bonds to repay their debt . On the basis of their evaluation , a management team assigns a rating to a company 's or government 's bonds . Other financial analysts perform budget , cost , and credit analysis as part of their responsibilities . At an increasingly large number of firms it is preferred that analysts earn the Chartered Financial Analyst -LRB- CFA -RRB- designation . There are also many regulatory requirements . For example , in the United States , sell-side or Wall Street research analysts must register with the Financial Industry Regulatory Authority -LRB- FINRA -RRB- . In addition to passing the General Securities Representative Exam , candidates must pass the Research Analyst Examination -LRB- series 86/series87 -RRB- in order to publish research for the purpose of selling or promoting publicly traded securities . Analyst recommendations on stocks owned by firms employing them may be seen as potentially biased . The research department sometimes does n't have the ability to bring in enough money to be a self-sustaining research company . The research analysts department is therefore sometimes part of the marketing department of an investment bank , brokerage , or investment advisory firm . Since 2002 there has been extra effort to overcome perceived conflicts of interest between the investment part of the firm and the public and client research part of the firm -LRB- see accounting scandals -RRB- . For example , research firms are sometimes separated into two categories , brokerage and independent . Independent researchers are not part of an investment firm and so do n't have the same incentive to issue overly favorable views on companies . But this might not be sufficient to avoid all conflicts of interest . Debate still exists about the way sell-side analysts are paid . Usually brokerage fees pay for their research . But this creates a temptation for analysts to act as stock sellers and to lure investors into `` overtrading '' . Some consider that it would be sounder if investors had to pay financial research separately and directly to fully independent research firms .