The Role Of The Financial Analysts In The Financial Sector Essay

The Role Of The Financial Analysts In The Financial Sector - Essay Example They communicate the financial risks involved in the business investments. This paper will discuss the purpose, summary and some of the essential functions of a financial analyst. The financial analyst is an essential profession in the enhancement of financial management in the financial sectors. The financial service industry is competitive in the market and tough to break. Therefore, acquiring the services of a financial analyst can enhance the ability of an investor to venture into the sector with limited risk. The financial analyst niche is, therefore, a core unit in the financial sector as it streamlines the financial performance of an organization. It gives the investor the pros and cons of the undertaking or failing to undertake certain decisions in their operations. Therefore, it serves to enlighten the investors on the most plausible and feasible decisions in their businesses. The financial analyst job is responsible for maintaining order and smooth running of a financial service organization. Rather than venturing into an unknown sector for investors, the financial analysts create awareness of the sector to the investors. They research macroeconomic and microeconomic conditions of a financial institution in order to aid in decision making. The fundamentals of the company require being known for them to provide recommendations for the business, sector and the industry. They recommend the course of action to their bosses such as whether to sell or buy stocks from a company based on its current financial strength. The financial analyst also makes projections of performance by financial institutions hence making it easy to invest in profitable companies. Therefore, the analyst must always be aware of the current developments in the sector of their specialization. This aids in preparing the financial models for predicting the economic conditions in the future for any variables.