What is a 'Research Analyst'

A research analyst is a person who prepares investigative reports on securities or assets for in-house or client use. Other names for this function include financial analyst, securities analyst, investment analyst, equity analyst, ratings analyst, or simply "analyst." The work conducted by the research analyst is in an effort to inquire, examine, find or revise facts, principles and theories for internal use by a financial institution or an external financial client. The report an analyst prepares entails the examination of public records of securities of companies or industries, and often concludes with a "buy," "sell" or "hold" recommendation.

If the research analyst is involved with an investment bank or a securities firm controlled by a member organization of the Financial Industry Regulatory Authority (FINRA), he or she may be required to register with a self-regulatory organization and/or take certain exams.

Breaking Down 'Research Analyst'

Research analysts are usually divided into two groups: "buy-side" and "sell-side." A buy-side (brokerage) research analyst, employed by an asset management company, recommends securities for investment. The research of a sell-side (investment firm) analyst tends to be sold to the buy-side. Sell-side research is also given to clients for free for consideration, such as in an attempt to win business. Such research can be used to promote companies.

Buy-side research analysts are often considered more professional, academic and reputable compared to the sell-side. Sell-side research jobs, often likened to marketing, often pay higher salaries.

Who Employs Research Analysts?

Research analysts can work at a variety of companies, such as asset managers, investment banks, insurers, hedge funds, pension funds, brokerages or any business that needs to crunch data to spot trends or decide on a valuation, make an investment decision or forecast the outlook of a company or asset. According to the U.S. News Best Jobs report, the median salary for a research analyst in 2015 was $62,150, while the best-paid earned more than $120,000 and the lowest $33,530.

Research Analyst Qualifications

Companies that employ research analysts sometimes require a master's degree in finance or a Chartered Financial Analyst (CFA) designation on top of several regulatory hurdles. Research analysts might be required to take the Series 86/87 exam if they are involved with a member organization. Other securities licenses often required include the Series 7 general securities representative license and the Series 63 uniform securities agent license. FINRA licenses are typically associated with the selling of specific securities as a firm’s registered representative. Investment analysts may also seek to obtain the Chartered Financial Analyst (CFA) certification.

  1. Buy Side

    The side of Wall Street comprising the investing institutions ...
  2. Analyst Sponsorship

    A positive endorsement that an analyst makes regarding a company's ...
  3. Research Report

    A document prepared by an analyst or strategist who is a part ...
  4. Security Analyst

    A financial professional who studies various industries and companies, ...
  5. Sell

    The process of liquidating an asset in exchange for cash. The ...
  6. Technical Analyst

    A technical analyst, or technician, is a securities researcher ...
Related Articles
  1. Financial Advisor

    Becoming a Financial Analyst

    Understand the types of career paths you can take as a financial analyst, and learn the education and skills you need to launch a career in this field.
  2. Financial Advisor

    Career Advice: Financial Analyst Vs. Research Analyst

    Read an in-depth comparison between a career as a financial analyst and a career as a research analyst, including advice on which one to choose.
  3. Personal Finance

    Testing 3 Types Of Analysts

    Different clients require different research reports. Which type of analyst do you need?
  4. Personal Finance

    Investment analyst: Career path and qualifications

    Learn how to prepare for a career as an investment analyst and how many professionals in the field progress through their careers.
  5. Personal Finance

    Careers In Buy-Side And Sell-Side Research

    The primary professions on Wall Street are made up of sell side and buy side analysts. This article is an overview of the two primary avenues for individuals interested in both fields.
  6. Personal Finance

    Financial Data Analyst: Career Path & Qualifications

    Learn more about the career options available to financial data analysts, and determine whether the profession is a good match for you.
  7. Personal Finance

    Careers: Equity research versus investment banking

    Equity research is sometimes viewed as the unglamorous, lower-paid cousin to investment banking. In this article, we compare the two careers.
  8. Financial Advisor

    Sell-Side Analysts Need Series 86/87 Exams

    Though these tests are not particularly difficult or comprehensive, passing them is mandatory to work as a sell-side analyst.
  9. Personal Finance

    Financial Analyst: Career Path & Qualifications

    Read about what it takes to become a financial analyst in a corporation or securities firm, and learn how far you can rise in the profession.
  1. What is the difference between a buy-side analyst and a sell-side analyst?

    The main difference between a buy-side analyst and sell-side analyst is the type of firm that employs them and the people ... Read Answer >>
  2. What kinds of financial analysis jobs are there?

    Read about some of the different types of financial analysts, including those considered to be on the buy side and those ... Read Answer >>
  3. What's the average salary of an operations research analyst?

    Learn how much operations research analysts at different experience levels make on average across the nation and in specific ... Read Answer >>
Hot Definitions
  1. Standard Deviation

    A measure of the dispersion of a set of data from its mean, calculated as the square root of the variance. The more spread ...
  2. Entrepreneur

    An Entrepreneur is an individual who founds and runs a small business and assumes all the risk and reward of the venture. ...
  3. Money Market

    The money market is a segment of the financial market in which financial instruments with high liquidity and very short maturities ...
  4. Perfect Competition

    Pure or perfect competition is a theoretical market structure in which a number of criteria such as perfect information and ...
  5. Compound Interest

    Compound Interest is interest calculated on the initial principal and also on the accumulated interest of previous periods ...
  6. Income Statement

    A financial statement that measures a company's financial performance over a specific accounting period. Financial performance ...
Trading Center