Financial Analyst Interview Questions and Answers
Do you wish you had a forecast for your financial analyst interview? We can help. While we can’t predict exactly what your interview will cover, we have a list of 6 common financial analyst interview questions that you might be asked. Get ahead of the game by practicing your answers to these industry-specific questions.
6 Financial Analyst Interview Questions
- Name one company you would invest in right now.
- Tell me about one time your financial forecast failed or was significantly off.
- How do you communicate with people who don’t have much financial knowledge?
- What financial challenges is our company facing?
- How is tech changing the finance industry?
- What licenses and certificates do you have or plan to pursue?
Interview Question #1: Name One Company You Would Invest in Right Now
Financial analyst interview questions are often designed to gauge your knowledge of the market. While you clearly shouldn’t choose to invest in a failing company, there are a few pitfalls beyond that.
- Back your answer up with details that demonstrate that you’re familiar with market conditions.
- Don’t pick a direct competitor or controversial companies to avoid ruffling feathers.
- For bonus points, choose an up-and-coming company versus the most well-known ones. If the interviewer learns something new from you, you’re off to a good start.
- If you’ll work with individuals as opposed to a company looking for a startup to invest in, mention that the best investment strategy is usually a diversified portfolio.
How You Could Answer:
“A diversified portfolio is wiser than investing in one specific company. This is what I would recommend my clients to do. I would also assess their tolerance—do they prefer low, medium, or high risk?
However, if I were to personally choose one company to invest in today, it would be Company X. This pharma company has a patent on this new, groundbreaking cancer drug for the next 10 years, so it’s unlikely they’ll face much competition. They’ve proven themselves in the pharma space and have a ton of room for growth.”
Interview Question #2: Tell Me About One Time Your Financial Forecast Failed or Was Significantly Off
Financial forecasts aren’t always accurate. Even the most skilled analysts sometimes get it wrong. Talking about your failures is one of the more challenging financial analyst interview questions, but you can tackle it like you would other questions about mistakes on the job.
- Bring up an instance where a sudden market change impacted your forecast.
- Discuss how other analysts also got it wrong at the time.
- Detail what you learned from the experience.
How You Could Answer:
“Nobody could have predicted the COVID pandemic, the shutdown, and its effect on the housing and stock market. We didn’t have a precedent for those kinds of circumstances, which made it difficult to predict the outcome. In the very beginning, the consensus was that the market was going to crash due to the shutdown, but the reality turned out to be more complex.”
Interview Question #3: How Do You Communicate With People Who Don’t Have Much Financial Knowledge?
Being able to explain complex financial details in simpler terms is a strength to have as a financial analyst, especially if you work with private clients. Even if you work in the finance department of a company, you might advise other staff who have some but not expert knowledge of finance, for example a marketing manager creating a new campaign.
- Give examples of visual aids you use, such as charts and graphs.
- Discuss how you explain financial terms in simpler language.
How You Could Answer:
“I prepare my clients with some “homework” before our meeting, giving them suggested reading so that they’re informed when we start discussing possible investments. I illustrate my points with graphs and charts when possible because most people are visual learners. Whenever we come across financial terms, I check in with them to see what their understanding of the word is and explain it to them if they’re not sure.”
Interview Question #4: What Financial Challenges Is our Company Facing?
Be honest about what you read about the company when you answer financial analyst interview questions. You’re not interviewing for a PR position—you’re interviewing to be a financial analyst.
- Discuss challenges, but also bring up the company’s strengths and why you still want to work for them.
- If the company is doing well financially, you’ll still need an answer to this. Saying that all is well doesn’t reveal much about your financial insight. Consider discussing future market changes and upcoming competitors.
How You Could Answer:
“Your Q2 report showed that your competitor has a higher share of young customers. Your market share could increase significantly if you invested more in products for this market. Three years ago you launched a smartwatch geared towards the 25 to 40 demographic. This product had a significant effect on your revenue that year.”
Interview Question #5: How Is Tech Changing the Finance Industry?
As a financial analyst, you’ll need knowledge beyond numbers and forecasts, such as insight into the industry as a whole, trends, and challenges. This is why you’ll often be asked financial analyst interview questions about the industry.
When answering, keep an objective or positive tone and don’t focus too much on challenges.
How You Could Answer:
“The rapidly growing area of fintech is revamping the financial industry, creating new opportunities in startups but challenges the market share of traditional financial companies. Fintech solutions are very easy to use, which is taking some customers away from traditional banking solutions. Traditional banks need to be more innovative to compete with fintech solutions, such as digital currencies and AI advisors.”
Interview Question #6: What Licenses and Certificates Do You Have or Plan to Pursue?
Since finance is such a vast area, financial analysts often specialize in a specific region, industry, or product. Becoming specialized can help you on the job market.
- Start with any general licenses and certifications you have or are planning to pursue, such as a license from the Financial Industry Regulatory Authority, which is required for many jobs.
- Consider some specialized options as well. Focus on licenses and certificates relevant for the company you’re interviewing for.
- Discuss how this knowledge can benefit the company.
How You Could Answer:
“I have a certification as a Chartered Financial Analyst from the CFA Institute. The next certification I plan to pursue is the Certified International Investment Analyst because I want to specialize in international finance. I’ve read that your company wants to expand into new markets in Asia, and this certification will help me plan a detailed investment strategy to gain market share in this region.”
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