Financial Advisor and Investment Advisor
Financial advisors generally take a long-term view of your investment
horizon. They're trained to help you make objective decisions based on
your specific financial goals. The truth is, a financial advisor can
potentially make a big difference in your investment results.
On their own, investors may act on emotion rather than information
buying and selling based on good and bad news in the media. Your
financial advisor can encourage you to stay on course during uncertain
times or discourage you from paying more than may be warranted for an
investment.
Why Use an Investment Advisor?
A Qualified Professional Can Help You:
Determine your long-term financial goals
Screen out funds that do not match your objectives
Assess risk tolerance
Research funds that meet your requirements
Determine asset allocations
Understand the risks and potential rewards of investing
Monitor investment performance
Review investment needs on a continual basis
Make decisions in difficult markets on an on-going basis
Answer questions, provide advice and reassurance
Financial analysts and personal
financial advisors provide analysis and guidance to businesses and
individuals to help them with their investment decisions. Both types of
specialists gather financial information, analyze it, and make recommendations
to their clients. However, their job duties differ because of the type of
investment information they provide and the clients for whom they work.
Financial analysts assess the economic performance of companies and industries
for firms and institutions with money to invest. Personal financial advisors
generally assess the financial needs of individuals, offering them a wide range
of options.
Financial analysts, also called securities analysts and investment
analysts, work for banks, insurance companies, mutual and pension
funds, securities firms, and other businesses, helping these
companies or their clients make investment decisions. Financial
analysts read company financial statements and analyze commodity
prices, sales, costs, expenses, and tax rates in order to determine
a companys value and to project its future earnings. They often meet
with company officials to gain a better insight into the firms
prospects and to determine its managerial effectiveness. Usually,
financial analysts study an entire industry, assessing current
trends in business practices, products, and industry competition.
They must keep abreast of new regulations or policies that may
affect the industry, as well as monitor the economy to determine its
effect on earnings.
Financial analysts use spreadsheet and statistical software packages
to analyze financial data, spot trends, and develop forecasts. On
the basis of their results, they write reports and make
presentations, usually making recommendations to buy or sell a
particular investment or security. Senior analysts may even be the
ones who decide to buy or sell if they are responsible for managing
the company's or clients assets. Other analysts use the data they
find to measure the financial risks associated with making a
particular investment decision.
Financial analysts in investment banking departments of securities
or banking firms often work in teams, analyzing the future prospects
of companies that want to sell shares to the public for the first
time. They also ensure that the forms and written materials
necessary for compliance with Securities and Exchange Commission (
SEC)
regulations are accurate and complete. They may make
presentations to prospective investors about the merits of investing
in the new company. Financial analysts also work in mergers and
acquisitions departments, preparing analyses on the costs and
benefits of a proposed merger or takeover.
Source: Department of Labor (www.dol.gov)
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