Market Research Analyst Interview Preparation Guide
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Market Research Analyst frequently Asked Questions in various Equity Research Analyst job Interviews by interviewer. The set of questions here ensures that you offer a perfect answer posed to you. So get preparation for your new job hunting

26 Equity Research Analyst Questions and Answers:

1 :: What is equity research?

Desired information availability and consumption spurned a whole new industry, popularly known as Equity Research.
Equity research is the study of equities or stocks for the purpose of investments. Equity research is what an equity research analyst does. In simpler terms, equity research is the act of gathering information:
1) Information that helps investors to decide where to put in their money
2) Information that traders require to understand whether to enter or exit a market position
3) Information that financiers (bankers and firms) need to evaluate companies
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2 :: Which important skills are for a research analyst?

To be painstakingly detail-oriented is crucial. Strong math is also of utmost importance. Analytical skills have to be top-notch if a person is to be able to interpret the market and company performance. And communication skills are important because a research analyst communicates with clients and target industries and prepares reports regularly.
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3 :: Why do you want to work in equity research?

If your aim is to work in equity research or you're interested in any finance position, you should have a good reason for applying for the position you're interviewing for.
In the case of equity research, mention your non-finance work experience as a reason to focus on the sector you're interviewing for. Also, you could use a specific class or course that helped you prepare for this position.
One way to look at equity research vs. investment banking is that as an equity research analyst/associate:
★ You only have access to public information, which makes the job interesting.
★ You get to talk to suppliers, customers and competitors of your coverage universe.
★ You focus on one sector and eventually become an expert in that sector.

On the other hand, as an investment banking associate/analyst:
★ You get to work with companies directly and you could have access to material non-public information.
★ You work on many deals with different scopes.
★ You work on companies from different sectors.

Just do your research before you head to an interview and have couple reasons on why you picked this position over another one. Saying that you'll get to apply your finance skills might not be enough, because you could apply them whether you work in equity research or in investment banking.
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4 :: Do you know the purpose of equity research?

The purpose of equity research is to study companies, analyze financials and look at quantitative and qualitative aspects, helping investors of varying degrees to make an informed decision.
As the name suggests, 'research' plays the most important role here.
Over the years, research methods have changed but the sole intention of research remains the same.
The number of investors is booming and so is the need for exploring the nature of investments.
Investors wish to take calculated and informed decisions, and this is where the role of equity research begins.

The purpose of equity research and the researcher is manifold.
To begin with, one gathers and analyses industry data and financial models of a specific company or an industry.
It also involves understanding current market trends, both from the perspectives of macro economy and micro economy, and report findings. Since the equity research targets a specific audience, it is necessary to tailor the findings to the audience demand.

Further, adequate stress is laid on the accuracy of information. If investors take actions based on any kind of misinformation or misrepresentation, losses are tremendous and harmful to both the investor and the company. Therefore, equity analysts spend a considerable amount of time analyzing stocks and valuating estimates.
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5 :: Explain equity research process?

Multiple steps are involved in the equity research process, which are given below:
1. Economic Analysis
2. Industry Analysis
3. Company Analysis
4. Financial Statement Analysis
5. Financial and Valuation Modeling
6. Report Writing
7. Presentation or Recommendation
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6 :: Define economic analysis in equity research?

Economic analysis is a systematic practice undertaken to determine the usability of available resources, comparison between two or more resources, accounting opportunity costs and measuring the scope or viability of an investment.
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7 :: What is industry analysis in equity research?

Industry analysis is a tool used for assessing current markets and understanding its complexities. Political, economic and market factors are reviewed to understand its influence over the development of the industry.
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8 :: What is company analysis in equity research?

Company analysis is a series of activities undertaken to analyse the operations of a business, focusing on the cause and effect of decisions and how they are likely to benefit (or not) future investors.
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9 :: Tell me what is financial statement analysis in equity research?

Accounts of a company are evaluated to determine the financial soundness (or otherwise) of the company. Profit and loss statements and managerial practices are overseen to prepare an accurate financial statement.
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10 :: What is financial and valuation modeling in equity research?

Financial and valuation modeling is the process of valuing the company and its assets.
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