Last updated on December 5th, 2023 at 09:08 am
What is the Difference Between a Quantitative Analyst and a Financial analyst?
A financial analyst or a quantitative analyst is a great career option for you if you are someone who is great with numbers and has amazing analytical skills. The role of a financial analyst is to identify trends and predict their outcomes to help investors and clients make top-notch investment decisions. Organizations rely heavily on financial analysts and their reports before making stock, security and trading decisions.
The role of a quantitative analyst is slightly similar while being different. Quantitative analysts conduct data analysis which may or may not affect investment decisions of a company. Numbers related to sales, labor or productivity are often involved here. Organizing important data, up-to-date knowledge of computer skills is a must.
In spite of having similar job markets, required qualifications and skill sets, the actual differences in job role help you understand better if you are more suited for the role of a financial analyst or a quantitative analyst.
What does a quantitative analyst do?
As a quantitative analyst, you will have a multitude of responsibilities, starting from programming, financial research, trading knowledge, risk management to exhibiting top skills in data sciences, mathematics, statistics or software development. Data analysis will be one of the most important jobs you would need to perform; an understanding of algorithms and computing mathematical rules are required to predict working of models.
Quantitative analysts also often liaise with other departments, hence market prediction including risk of investments are also areas you will have to work in.
Here are a couple of responsibilities you will have to fulfil as a quantitative analyst of an organisation:
● Make modeling decisions based on market trends
● Develop complex working quantitative models
● Perform coding tasks and also work on analysis of daily statistics
● Plan and implement methods of data collection
● Work on testing new models and products
● Ensure analytical models are working fine
● Verification of data and results using analytical tools
● Work closely with other departments or teams , which include computer engineers, mathematicians and other data science professionals
● Liaise with software developers
● Work with finance professionals in understanding market trends, data and investments
● Present data, results and analysis to clients, investors and senior founders as required
What does a financial analyst do?
A financial analyst is someone who studies market trends and how these affect the performance of a company, its securities, bonds or stocks. As a financial analyst, you will be required to understand the financial fundamentals of an organisation and help in taking major investment decisions with regard to a company’s growth or finances.
While the best way to go about this is to sign up for a financial analyst course, you can also develop certain skills needed for the job on your own. One of the most chosen career paths by young professionals, this field gives you the liberty of working across varied industries and exposure to a relatively higher paycheck. If you are someone who has a knack for understanding the intricacies of finance, and you already have a business or a finance degree, this is the right career path for you.
As a financial analyst, you will be required to create financial models to predict the outcome of business decisions, which includes ideating suitable deals and mergers, along with providing the senior management with insights on revenue increase and management of assets. Some of the major responsibilities of a financial analyst include:
● Analysis of both present and past financial data.
● Identifying market trends based on the current financial performance of the organisation
● Preparing financial reports based on identified market trends and presenting them
● Communicating insights to required persona of the senior management
● Developing long and short term financial strategies in consultation with other teams and management
● Preparing budgets
● Exploring more investment opportunities and their advantages to the organisation
● Forecasting financial trends based on developed financial models
● Looking out for any policy that may have a positive impact on the financial growth of the organisation
To fulfil your dream of becoming a highly successful financial analyst, it is advisable to get enrolled in a CFA (Chartered Financial Analyst) programme. A financial analyst course not only imparts relevant knowledge but also helps you understand and be at par with the highest professional skills required in this field.
