What does a Financial Quantitative Analyst do?

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What is a Financial Quantitative Analyst?

Also known as: Quant, Financial Quant Analyst, Quantitative Financial Analyst, Quantative Research Analyst, Quantitative Analyst

A financial quantitative analyst will provide guidance to businesses and individuals making investment decisions. They assess the performance of stocks, bonds, and other types of investments.

A Financial Quantitative Analyst is a specialized type of Financial Analyst.

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What does a Financial Quantitative Analyst do?

Financial quantitative analysts typically do the following:

  • Recommend individual investments and collections of investments, which are known as portfolios
  • Evaluate current and historical data
  • Study economic and business trends
  • Study a company's financial statements and analyze commodity prices, sales, costs, expenses, and tax rates to determine a company's value by projecting the company's future earnings
  • Meet with company officials to gain better insight into the company's prospects and management
  • Prepare written reports
  • Meet with investors to explain recommendations

Financial quantitative analysts evaluate investment opportunities. They work in banks, pension funds, mutual funds, securities firms, insurance companies, and other businesses. They are also called securities analysts and investment analysts. Financial analysts can be divided into two categories: buy side analysts and sell side analysts.

  • Buy side analysts develop investment strategies for companies that have a lot of money to invest. These companies, called institutional investors, include mutual funds, hedge funds, insurance companies, independent money managers, and nonprofit organizations with large endowments, such as some universities.

  • Sell side analysts advise financial services sales agents who sell stocks, bonds, and other investments.

Some analysts work for the business media and are impartial, falling into neither the buy side nor the sell side.

Financial quantitative analysts generally focus on trends affecting a specific industry, geographical region, or type of product. For example, an analyst may focus on a subject area such as the energy industry, a world region such as Eastern Europe, or the foreign exchange market. They must understand how new regulations, policies, and political and economic trends may affect investments.

Investing is becoming more global, and some financial quantitative analysts specialize in a particular country or region. Companies want those analysts to understand the language, culture, business environment, and political conditions in the country or region that they cover.

What is the workplace of a Financial Quantitative Analyst like?

Financial quantitative analysts work primarily in offices. Most work full time, and many work more than 40 hours per week. They travel frequently to visit companies or potential investors, and face deadline pressure. Much of their research must be done after office hours because their days are filled with telephone calls and meetings. Many financial analysts work at large financial institutions based in New York City or other major financial centres. In 2010, about 46 percent of financial analysts worked in finance and insurance industries. They worked primarily for security and commodity brokerages, banks and credit institutions, and insurance carriers. Others worked throughout private industry and for government.

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