Mutual Fund Analyst

Mutual Fund Analyst Job Description

Mutual fund analyst refers to the person who conducts the research of the market or the market analysis, quantitative and qualitative analysis of the mutual funds, reviewing the financial statements of the different entities in order to provide advice to their clients for making sound investment decisions.

Many finance professionals go for financial modeling, investment bankingInvestment BankingInvestment banking is a specialized banking stream that facilitates the business entities, government and other organizations in generating capital through debts and equity, reorganization, mergers and acquisition, etc.read more, and private equity profiles. But if you want to stand out and have a solid understanding of the equity market, you can stand out in the crowd and choose to pursue one of the most lucrative finance career options. Yes, you guessed it right. We’re talking about Mutual Fund Analyst.

The reason we urge you to try this (subject to you’re willing) is that there’s a market crunch for the right talent. There’re more than 200 Asset Management Companies (AMC) who have thousands of mutual fundsMutual FundsA mutual fund is an investment fund that investors professionally manage by pooling money from multiple investors to initiate investment in securities individually held to provide greater diversification, long term gains and lower level of risks.read more. But they’re not enough qualified individuals to fit the bill.

So what do you need to become a mutual fund analyst?

As a mutual fund analyst, you would be working under a mutual fund manager and would be responsible for research and market analysis so that the fund managers can make sound investment decisions for clients.

Now mutual fund analyst is the starting point, not the end. If you have ambition and aspiration for growth, you can become a mutual fund manager in the years to come.

Sounds good?

Mutual Fund Analyst

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Source: Mutual Fund Analyst (wallstreetmojo.com)

Education

You would agree that a qualified mutual fund analyst needs to have required educational qualification to get placed in big or small companies. So, here’s the list of education you can think of if you would like to become a mutual fund analyst. But, remember, your focus would always be to know more about mutual funds.

  • The first criterion to be an entry-level mutual fund analyst is to have a bachelor’s degree in finance or similar discipline. That means if you have a graduate degree in economics, accounting, tax, investment analysis, or finance & accounts, you’re good to go. But don’t stop there. Because to add more value to your organization, you need to add more value to yourself.
  • So go for a master’s degree as well. If you do a Masters in Finance or MBA in Finance (it’s a better option), you will be treated as more qualified for the mutual fund analyst position. Now you would find MBAs in every nook and corner. So try to do your MBA from a reputed B-School to stand out.
  • You may be wondering what more you can do. Here’s the deal. If you can do CA along with an MBA in Finance, it would become a lethal combination. You would be preferred much more than your peers.
  • Suppose you have a desire to not be stuck in a mutual fund analyst. What would you do? First of all, if you have an MBA in Finance from a reputed institute and CA, you’re good to go as a mutual fund analyst. Now, if you want to become a fund manager pretty soon with a few years of experience, you need to go for CFA or CFP exam. These designations will help you stand out if you would like to be a mutual fund manager within a few years.

We’ve given a list of what you can do. Your job is to plan ahead about your career so that when you need to take the plunge, you become ready.

Job Responsibilities

Education is a pre-requisite. But you need to know the detailed job responsibilities to have an idea about what you need to do. Here are the responsibilities you need to handle as a mutual fund analyst.

First, let’s talk about the primary responsibilities, and then we will discuss what else you need to do.

Primary Responsibilities

  • First of all, you need to review the financial statements prepared by fund accountants for investment and other funds.
  • You also need to take care of the review of daily swing pricing, which means you need to monitor the adjustments of Net Asset Value (NAV) for large funds.
  • You need to do a daily hedge review as well. This means you need to monitor the redemption and Foreign Exchange entries hedged by the fund accountants for investment funds.
  • You also need to review daily or monthly trading activities for investment funds.
  • A big part of your responsibilities would be to review the due diligence of market value reconciliations performed between the organization’s data and fund accountants. You also need to do a detailed portfolio reconciliation of holdings and foreign exchange rates across all fund complexes.
  • You need to do mutual fund qualitative and quantitative analysis like scheme ranking, research, performance attribution, etc.
  • You also need to write reports and draft columns to talk about the funds.
  • You need to keep on pushing your horizon to learn more about the mutual fund industry, various market sectors, and fund families.
  • Among all, you need to be able to see the big picture of the long term investment strategy so that all financial advisors, marketing executives, and decision-making stuff can work in unison to achieve a common goal.
  • You also need to coordinate with the fund research team to be able to get the best investment options and the risk inherentRisk InherentInherent Risk is the probability of a defect in the financial statement due to error, omission or misstatement identified during a financial audit. Such a risk arises because of certain factors which are beyond the internal control of the organization.read more within them because you need to have a solid research database that also has a fund recommendation and conclusion.
  • You’re also required to adhere to the company investment policies to be able to recommend mutual fund options to the prospective clients.
  • Finally, you need to keep yourself updated about the latest trends of the mutual fund market to be able to uplift your expertise and to be able to help your firm magnify profits.

There’re also some other responsibilities which you need to take care of. Here are they –

  • You need to support the fund service providers.
  • You also need to prepare various valuation reports and perform valuation checks.
  • Often times, you may need to take responsibility as an individual instead of getting the supervision of fund managers. In that case, you need to sit with the fund manager or the person who can guide you and understand what they expect of this job position. And then adhere to whatever s/he says.
  • You will also need to maintain a liaison with global service providers.

These are the job responsibilities you need to perform. Now let’s look at the skill-sets you need to have to be able to effectively perform these responsibilities.

Skill-sets required

There are a total of eight skill-sets. You need to have to be able to perform the above job responsibilities like a rock star. Have a look at these eight skills and if you would like to become a mutual fund analyst, try to work on these –

If you would like to be a qualified mutual fund analyst, the above eight are mandatory. You need to work hard to develop them.

Compensation

Now, this is the most lucrative part. Let’s talk about the compensation of mutual fund analyst.

The compensation you would get as a mutual fund analyst would depend on what sort of experience you have. Are you a fresh graduate? Or do you have a few years of experience in the other domain of finance? Or have you worked as a mutual fund analyst for a few years? For every case, the salary would be different.

If you’re in the USA, then the salary would be drastically different. The average annual salary of mutual fund analysts in the USA is around the US $65,000 to $75,000 per annum.

If you have experience of 1-2 years as an analyst in finance, you would be able to get around INR 5-6 lakhs per annum in India. If you have more experience (5+ years), then you may get around INR 10-15 lakhs per annum, depending on the organization you’re with.

Beyond Mutual Fund Analyst

Many of you would like to aspire to be more than a mutual fund analyst. Yes, you can be. There’re certain things you need to adhere to –

As a mutual fund manager, your main responsibility would be to invest investors’ money in worthy investments like stocks, bonds, and other financial instruments. You need to work as an individual and also within a periphery of other analysts and fund accountants who will feed you the data you need to take the final call.

The job of a mutual fund manager is hectic, but you would be respected by everyone in the team, and you will have a lot of autonomy for your experience in a mutual fund.

In the final analysis

Now you know what you need to know to become a qualified mutual fund analyst. All you need to do now is to take the first steps. If you’re finance students, you should learn more about mutual funds and can enroll yourself in a master’s degree in finance or an MBA in Finance. If you aspire, plan and take action, the goal is not far ahead from your reach.

Reader Interactions

Comments

  1. Marcos Bridezilla says

    Good source of information. This was really something interesting that I have read about mutual fund analyst. Thanks for providing such valuable information. Do have any information on mutual fund types and what re the actual benefits of investing in mutual funds?

    • Dheeraj Vaidya says

      thanks and happy to know you found this interesting. Yes I do have a detailed post, in which I have done the complete analysis on mutual funds, types, investment approaches and many more interesting things – Mutual Fund

  2. Keegan Courter says

    Thanks for sharing this complete beginners guide. This was really very helpful for me n I hope for many others have also liked this. I have heard about close ended mutual fund schemes but I actually don’t know what this actually means. Sir please if can you tell me what are the close ended mutual fund schemes?

    • Dheeraj Vaidya says

      thanks for your note. I am glad you liked this. Well close ended mutual fund schemes are nothing but the schemes that have stipulated period and in which the investors can invest only during the period of New Fund Offer that too for limited time only. These are also called as protective mutual funds which invest and also guard the capital at the same time.