What is a Portfolio Analyst?

A career as a portfolio analyst requires flexibility. In this industry, the analyst provides services to every layer of the company’s investment team. Whereas every level has a different role in ensuring that the company meets certain guidelines, portfolio analysts also have a large responsibility to be aware of compliance throughout the organization.

Job Duties of Portfolio Analysts

The diverse role of portfolio analysts requires a certain degree of profiency in multiple skill areas such as portfolio management, trading and risk management. Some of the most common duties of portfolio analysts entail conducting a significant amount of historical research of the industry. By gaining a clear understanding and insight into the manner in which trends have fallen and risen in the past, portfolio analysts can confidently conduct examinations and make predictions about the financial future of the company in which they work.

In addition to researching and analyzing past behaviors and trends, portfolio analysts also conduct a significant amount of comparative research on different industries. By identifying the differences among companies and industries, portfolio analysts gain additional insight that can help to strengthen the accuracy of their analyses. The specific job duties of portfolio analysts, while somewhat similar across industries, may vary according to the needs of the specific organization or company with whom the analyst is employed.

Education Requirements for Portfolio Analysts

Portfolio analysts must have some type of formal degree as well as significant past experience in the financial field, mainly due to the nature of the career’s responsibilities. In most cases, portfolio analysts will need to earn a bachelor’s degree as well as a master’s degree in economics, business, finance or other equivalent areas. However, although the minimum educational requirements for portfolio analysts is consistent within the industry, specific experience and higher education requirements vary among employers. Portfolio analysts must be able to understand the technical aspects and nuances of all financial metrics. Since compliance is an integral part of the process, analysts must be well-versed in all relevant legal implications.

Other Considerations of a Portfolio Analyst Career

Portfolio analysts may also act as a middleman between the company’s client and the team manager, although this is not necessarily the case in every organization. The analyst must ensure to maintain a clear, open channel of communication between clients and managers so that both parties clearly understand every component of the portfolio. In addition, portfolio analysts will oftentimes use comprehensive software solutions in order to more accurately conduct their analyses. Some types of software may be capable of automatically identifying one or more key metrics that positively or negatively affect the performance of a portfolio. Portfolio managers can use software to their advantage by making sure that the impression they receive of the portfolio’s performance is not only credible but founded in reliable data as well.

Related Resource: What is a Budget Analyst?

Portfolio analysts use multiple insights gained from a diverse range of areas in order to investigate portfolio performance ratings as well as the metrics that influence them. The various information sources used by portfolio analysts are necessary for creating the clearest picture of analytical clarity. According to the Bureau of Labor and Statistics, employment of financial analysts is expected to grow 12 percent through 2024, and a portfolio analyst can expect to earn an average salary of $81,760 per year or $39.31 per hour.