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What Does A Capital Markets Analyst Do?

What Does A Capital Markets Analyst Do?

. 2 min read

In this article

What Are Capital Markets?

Capital markets are the places where those who have the capital (retail and institutional investors) meet those who seek capital (such as corporations and governments). The stock and the bond markets are examples of some of the most liquid capital markets, where investors trade thousands of securities daily, both on primary and secondary markets.

In primary markets, institutional investors buy securities directly from the issuing firm. For example, mutual funds and hedge funds can buy shares in businesses going public through an IPO (initial public offering). In secondary markets, such as NYSE or Nasdaq, investors trade securities that have already been listed.

capital markets

Source: CFI

What Does A Capital Markets Analyst Do?

With thousands of securities exchanged daily and trillions of dollars in transactions, companies raising capital and investors looking for valuable opportunities need the financial expertise and knowledge to make the most profitable financial decisions. A capital markets analyst can help both parties achieve their financial goals. So what does a capital markets analyst do? The analyst’s duties and responsibilities include:

  • Analyze or prepare financial reports and models (such as cash flow models and capital structure analyses)
  • Execute due diligence on new opportunities
  • Analyze market trends and identify strong investment opportunities
  • Prepare presentations and marketing pitch books for prospective investors
  • Develop financial terms and conditions (such as pricing) and support the execution of planned transactions
  • Create and maintain transaction documentation, as well as transaction reviews
  • Organize and oversee the transaction process (find potential investors, manage relationships with investors, organize meetings, etc...)

How To Become A Capital Markets Analyst?

Being a capital markets analyst requires a considerable amount of knowledge on how capital markets work, available investment products, and its role in the economy and investing. As you can guess, becoming a capital markets analyst is not easy.

First, you need the proper academic education—most capital markets analyst jobs require a bachelor's degree in finance, accounting, or related fields. In addition, what students usually learn at university is just the tip of the iceberg of the expertise you need to succeed in the real world. That's why most finance students take further training to gain the skills needed to get a job as a capital markets analyst.

One of the most popular financial training providers is CFI (Corporate Finance Institute). Their Capital Markets & Securities Analyst (CMSA) certification program covers the most critical knowledge and skills required to bridge the gap between theory and practical experience and gain a comprehensive understanding of the most popular capital markets products including equities, fixed income, foreign exchange, commodities, and derivatives.

It is ideal for any student who wants to work in sales & trading, asset management, wealth management, treasury, risk management, and commercial banking, whether on the buy-side or the sell-side. The program offers the expertise you need to make investment decisions and utilize appropriate trading strategies for different scenarios.