Top 8 Skills required for a career in the Finance industry along with best resources available.
We all work hard to make our dreams a reality. Every day we face new challenges which teach us new lessons and take us one step closer to our goals. At the same time, many of us are working hard but do not get satisfactory results. It feels like we are putting all our efforts in the wrong direction, making us doubt our abilities.
Let me remind you we all have immense potential within us. With dedication, hard work, focus and awareness, we all can achieve whatever we wish in our lives. Wait a minute, what is the role of “awareness” in our journey?
We all work hard but not each one of us becomes successful. That is because we don’t know if we are putting efforts in the right direction? Being aware of the right path to follow to achieve your dreams is in itself a perfect start. That’s why we are here to educate you about the top skills required to get into finance, along with the best resources available to build those skills. This blog contains all the information you need to know. So let’s get started.
Top Skills required to pursue finance
Any role related to finance requires two things — soft skills as well as Technical Skills.
Soft skills are of paramount importance in this domain as you would be managing the money of people or organisations or managing risk for them, etc. all these require you to communicate to your client and assure them that you are handling things perfectly. So for that, you should be efficient in:
Verbal Communication: Every day, there is a requirement to communicate to the technical and non-technical audience, and for that, you have to have command of your communication skills.
Written Communication: These roles require you to make presentations to share your ideas and write reports on a daily basis. So these skills are of utmost importance.
Technical Skills for a career in the finance Industry
- Accounting: You should understand, prepare and analyse all the financial statements, whether a Balanced Sheet, a P&L statement or an income or cash flow statement of a company.
- Time value of money and capital Budgeting: You should clearly understand money’s time value. Capital budgeting involves decisions based on whether a company should do a project or not.
- Meaning, usage and valuation of major asset classes: An essential requirement is to value assets(stocks, companies, bonds, derivatives, real estate, etc.). You can safeguard everyone from wasting money on overvalued stuff.
- Financial markets and institutions: We need to know in and out about the currency market, stock market or exchange rate market and all the basic things related to those( IPOs, repo rate, dividend, bonus, split, etc.). This requires time and dedication, and of course, everything becomes easier once you start enjoying the process.
- Probability and Statistics, Econometrics Knowledge about Probability and Statistics is essential, along with the understanding of Time series modelling and different models.
- Excel: VBA and Pro-forma modelling, i.e. how a company’s balance sheet would look in 3 years. You will use these things on a daily basis, so you have to be comfortable with them.
- Basic Macroeconomics: Knowledge about GDP, inflation, unemployment, etc. and the relation between all these things is fundamental. A clear understanding of these topics is a prerequisite no matter what you do.
- General Awareness: Clear understanding of the recent events in the economy and the financial markets is vital. You can follow the news or channels like FinShots, business standards, etc.
These skills don’t come on their own. We need to practice with dedication. So we are providing you with information on the best resources available online so that you can make the best use of them.
Resources to gain skills:
These are the best-refined resources to learn about these topics for a clear understanding as suggested by experts. (Do check out each of the links once, otherwise, you might regret it in future.)
- CFA level 1 material: This is readily available on the internet in the form of pdfs. It is the best resource to develop a clear understanding of the aforementioned fundamental topics. If you love reading, then these are going to be gems for you. Whether you should go for a CFA exam is a topic for a different blog, but everyone should refer to these to acquire knowledge.
- Zerodha Varsity: You can also refer to excellent resources available for free on the varsity app by Zerodha. This includes topics like Basics of Stock market, Personal Finance, Fundamental Analysis, Technical Analysis, Valuation of assets, etc.
- Aswath Damodaran Lectures: You will love these lectures if you prefer watching video lectures over reading books. He is popularly known as a Valuation guru. He is a professor of Finance at the Stern School of Business at New York University, ere he teaches corporate finance and equity valuation.
- Case Study Competitions and CFA equity research Challenge: Participate in as many as you can as it will take your soft skills to a different level along with improvement in presentation, problem-solving, financial planning and business analysis skills.
- Undergrad Level Prob. & Stats. Course, Ben Lambert, Mark Thoma (Econometrics) for Probability and statistics and Econometrics. And videos on the rest of the basic maths topics which are required.
- Martha Olney (Econ. Lectures UC Berkeley), FinShots App (General Awareness) If you are a complete beginner in economics, there is no other resource more relevant than videos of Martha Olney. You should give it a shot for a decent understanding of all the basic concepts if you are a beginner.
This was all about the skills companies seek in their employees and all the resources about which you should know at this stage to get into the finance industry. Keep Learning, Keep Shining.
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