6 Ways to Improve your Analytical Skills in Finance: A Guide
Big data is fundamentally transforming how the financial services industry functions. The exponential growth of technology and data generation is opening doors to opportunities that can alter processes, operations and decisions for the better. The financial services and banking industry is considered one of the most data intensive out of the lot, giving it a massive data bank to leverage on. There are innumerable benefits that the finance industry can benefit from like real-time stock market insights, financial modelling, customer analytics, risk management and fraud detection, among several others!
But this is only possible when individuals that make up this financial ecosystem are well equipped with the dexterity to capitalize on these advancements with analytical skills.
To capitalise on the inordinate potential of data in finance, financial institutions and banks are now scouting for talent that can understand it and work with it effectively. Thus, once data literacy and analytical skills ticked off your skills checklist, you will not only be able to make sense of raw data but use it to drive impactful change in your organisation. This makes analytical skills an important element for burgeoning financial professionals who are just entering the finance industry or those looking to progress in their career to achieve successful growth opportunities.
So, What are Analytical Skills?
Analytical skills can be defined as the ability to investigate a problem and find an optimal solution in a timely and efficient manner. This is done by thoroughly analysing the information you have at hand and drawing tangible insights form it. These skills are used when trying to detect patterns in certain occurrences, brainstorming ideas, dealing with large sets of data, synthesising information, and when carrying out decision making in certain situations.
Improving your Analytical Skills
If you want to brush up on your analytical skills to better analyse and organise data, interpret data patterns and make informed decisions, then here are some tips to help you reach your goals!
Here are 6 tips to help you improve your analytical skills in finance:
1. Find and use new tools
If you feel your current data analysis capabilities are being held back because of the tools you use, it may be time to venture out of your comfort zone and take on a new tool or software like SQL, Python, R or Tableau (or other data visualisation tools).
While it may be daunting to learn a whole new tool, its important to remember that your first step is to learn the basics to build the skills of an analyst and not to become a hardcore developer. It may also be worth noting, that to effectively embrace these new tools, it would be good to spend 40% learning the syntax, while dedicating the other 60% to applying these learnings in your projects. This will help permanently burn these new techniques into your brain’s hard drive.
2. Play around with mock datasets
Once you know the key formulas and data science concepts like the back of your hand, you can shift gear by practicing them on mock datasets. Like any other skill, you can improve your analytical skills by using them over and over. To help you keep your analytical capabilities alive and kicking there are a wide range of free resources online that can put your skills to the test. Import these datasets to Microsoft Excel and then let your skills run free – explore all kinds of possibilities, make mistakes, try that formula you are unsure of and ask the biggest of questions. This is sure to prepare you for better execution of concepts by taking your learning from the sandbox to implementing them to real datasets.
3. Sharpen your skills by playing games or brain teasers
Building up your brain’s analytical functions doesn’t have to be boring – playing games and brain teasers can be the perfect way to tug on the right wires in your brain and build the skills it needs. Puzzles and games that are based on visualising relationships between different variables, those that require examining cases from multiple perspectives or those that need conclusions to be drawn from a few known data points, can help one shape their skills to analyse data.
Games like Sudoku, Chess, Crosswords, Logic Puzzles or other kinds of strategic board games can really help bring out the analytical side in you, while being weaved into your daily life outside of work.
4. Take a course or training
Another effective way to boost your analytical skills to make better financial decisions can be done by taking courses or training programmes. So whether you want to build strong foundations in a particular topic, brush over concepts, or understand how to apply skills learned to drive successful projects in the workplace – there is no dearth of courses to choose from that will meet your specific objectives. These courses will, while giving you the resources to learn exactly what you need at the moment, will also allow you to learn from experts in the field as well as interact with other professionals in the same industry.
One such course on Artificial Intelligence in Finance by CFTE, will help you drive into key concepts like AI, Machine Learning, Natural Language processing that are based on statistical analytical capabilities to help you provide better solutions in various functions like – insurance, asset management, fraud detection and more.
If you plan to take on a project involving analytical capabilities, it would be beneficial to take advantage of such trainings or courses to help you deliver the project.
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5. Sharpen your problem solving skills
It can be overwhelming to deal with a swarm of financially complex problems everyday. But knowing that each problem that presents itself is an opportunity in disguise, and learning to effectively deal with them by practicing your problem solving skills can paradoxically help you prepare you to unforeseen situations. To sharpen your problem solving techniques, remember to always focus on the ‘Why’ of a problem or the reason it occurred – this will help you get to the root cause of the problem giving you an upper hand in providing a better solution. Another effective trick is to come up with as many possible solutions you can, even if some may be completely outrageous – this will help you choose the best solution. Drawing mindmaps with a problem at the centre of it that then branches out to causes and then possible solutions will help structure your thoughts to craft better strategies to get the desired outcome.
6. Mastering the art of the gab a.k.a communication skills
An underrated and often overlooked skill set to amp up your analytical capabilities in finance is ‘communication’. While this may seem misplaced amidst a plethora of technical skills required to excel analytically, it is in fact key to translating a bunch of numbers and graphs into insights that your team and management can understand. The art of verbally communicating the story behind your mathematical analysis is what will drive intelligent decision making.
It's Time to Invest in Your Analytical Skills
Data continues to be one of the primary pillars of a business’ valuable resources, which means that putting in time to build your analytical skill set is rudimentary. A failure to master these skills is bound to put one at risk of receding into the shadows, while those who understand data and can and can effectively deal with it will be the ones who drive the greatest value to business.
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Frequently Asked Questions
The Centre for Finance, Technology & Entrepreneurship (CFTE) is a global education platform that aims to equip financial professionals and organisations with the necessary skills to remain competitive in a rapidly changing industry. Our leading training programmes, curated by global industry experts, help talent build skills to join the digital revolution in finance. CFTE’s courses are globally recognised with accreditations from ACT, IBF, CPD, SkillsFuture and ABS.
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