Data analytics in finance is growing in importance. Globally, an increasing number of businesses are using data analytics to improve internal operations. They also rely on data analytics to help them understand their customers on a deeper level. This allows organizational leaders to make informed decisions that promote better business outcomes.
Wondering, “What is data analytics?” In short, data analytics is a practice that helps professionals make sense of raw data for the betterment of an organization.
“The chief aim of data analytics is to apply statistical analysis and technologies on data to find trends and solve problems,” said Thor Olavsrud, contributor to CIO.
Data analysis can benefit organizations across all industries. This is especially true of financial institutions, which often have a sea of raw data to sift through. Used correctly, financial data, such as purchasing behavior, along with credit card data, can be invaluable to these companies.
The Importance of Data Analytics in Finance
Is data analytics useful for finance? Absolutely. Data analysis is part of finance at this point. No financial organization can afford not to make use of data analysis.
The coronavirus pandemic has caused a tremendous amount of uncertainty in the finance sector.
“The lighthouse in this uncertainty is the ability to use advanced data analytics to better manage financials,” said Bassem Hamdy, author of The Importance of Data Analytics in Finance. “When a company is able to masterfully forecast cash flow and execute on its strategic financial visions, it is empowered to serve its market and clients for decades to come.”
Hamdy also explained that implementing a financial strategy starts with possessing an understanding of the true financial position of a company. This entails having the ability to answer questions using operational and financial data, not gut alone. This is where a financial data analytics professional comes in.
Still curious about why data analysis is crucial to the success of financial institutions? Check out Why Is Data Analytics Important?
How Data Analytics Is Revolutionizing the Finance Industry
According to an article by Softweb Solutions, data analytics is revolutionizing the finance industry. One way it is accomplishing this is by reducing the component of human error from daily financial transactions.
The article lists other reasons why data analytics in finance has transformed the finance sector:
- Data analytics enables finance executives to turn structured or unstructured data into insights that promote better decision making.
- Data analytics helps finance teams gather the information needed to gain a clear view of key performance indicators (KPIs). Examples include revenue generated, net income, payroll costs, etc.
- Data analytics allows finance teams to scrutinize and comprehend vital metrics, and detect fraud in revenue turnover. This is helpful since financial services experienced a huge increase in digital fraud activity in 2020.
Additionally, big data has improved the way stock markets work and has upgraded investment-related decision making.
What Does a Finance Data Analyst Do?
Finance data analysts are professionals who help financial institutions utilize data to make high-quality business decisions. One of their primary roles is examining financial records. They do this for the purpose of preparing in-depth reports for a financial organization.
Finance data analysts often are knowledgeable of and proficient in skills related to the following topics:
- Data mining
- Financial analytics
- Understanding business models
- Financial forecasting
- Creating financial models
- Risk management
- Big data analytics
- Advanced analytics
- Data management
- Predictive analytics
- Microsoft Excel
- Algorithms and algorithmic trading
- Python
- Automation
- Data science
- Business intelligence
- Machine learning
- Artificial intelligence
- Real-time data flows
Financial analysts often work with key organizational leaders, such as chief financial officers (CFOs). They help these professionals ensure the company makes sense of its raw data and benefits from it.
The best candidates for a finance data analyst role are often junior analysts that support business functions. These functions include marketing, finance or operations roles. However, these individuals are usually asked to work closely with data to interpret and communicate what they find in the data.
By earning one or more of the best data analytics certifications, these professionals can prepare for a career in financial analysis.
The Future Role of Data Analytics in the Finance Industry
The future role of data analytics in finance is secure as data analysis is critical to the success of financial institutions. After all, as the finance sector continues to digitize, there will be more raw data for organizational leaders to interpret. Data analytics will help them make use of the data.
Amazingly, just 0.5% of businesses make use of their data, according to Data and Analytics in Financial Services. Those who practice financial data analysis can help organizations make the most of the data they collect. You can get into data analytics in finance with CompTIA Data+ training and certification.
Learn more about CompTIA Data+: Analyze This: CompTIA’s New Data Analytics Certification.
Get Into Finance Data Analysis with CompTIA Data+
To get your foot in the door to data analytics in finance, you’ll need specialized skills. CompTIA Data+ certification training provides the skills you need to work in finance data analysis.
CompTIA Data+, which will be available in Q1 of 2022, offers a full training suite of Official CompTIA CertMaster products. These products include:
- CertMaster Learn: CertMaster Learn provides comprehensive eLearning that prepares you for the CompTIA Data+ certification exam.
- CertMaster Labs: CertMaster Labs provides hands-on experience in real virtual environments.
- CertMaster Practice: CertMaster Practice is an online knowledge assessment and certification exam practice and preparation companion tool.
Need more information about your online IT training options with CompTIA? Check this out.
When candidates buy a training bundle that includes both CertMaster Learn and CertMaster Labs, they enjoy an integrated training experience. Learn more in The New CompTIA eLearning Bundles: Where Knowledge and Practice Intersect.
Once you receive training for the CompTIA Data+ certification, it will be time to take the certification exam. Some of the topics and skills the certification exam covers include:
- Mining data
- Manipulating data
- Applying basic statistical methods
- Analyzing complex data sets
With CompTIA Data+, you can prove to employers that you have the skills needed to perform well in a finance data analysis role.
CompTIA Data+ covers the data analytics skills you need in finance. Start studying with CompTIA CertMaster Learn + Labs for Data+. Sign up for a free trial today!
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