what is a risk analyst?
As a risk analyst, your job involves identifying and monitoring risks associated with business decisions. You analyse the risks to the assets, capital, and investments of a company and use statistical analysis and models to evaluate financial data. Your goal is to recommend ways to reduce and control risks in the company while ensuring compliance with regulatory frameworks.
In addition to assessing the company's current situation and anticipating the impact of decisions, you also develop contingency plans. These plans are designed to minimise the negative impact of unfavourable economic conditions, such as changes in government policy or market crashes. Risk analysts work in various business sectors, including banking, finance, mining, and manufacturing.view vacancies
average risk analyst salary
As a risk analyst in New Zealand, you can expect to earn a median salary of $95,000 per year. However, the starting salary for this role can be as low as $85,000 annually and increases with experience. If you become a highly experienced risk analyst, you could earn over $105,000 per year. Your salary as a risk analyst depends on several factors, such as your level of experience, area of specialisation, and the size of the company you work for.
how to boost your salary as a risk analyst
The salary of a risk analyst depends on their experience and qualifications. To earn more, it's essential to have more certifications and qualifications. Additionally, having several years of experience in the industry can lead to a higher salary as it demonstrates expertise.
The size of the company you work for can also impact your earnings. If you work for a big financial institution or company, you're likely to be paid more due to the complexity of tasks and the team you oversee. Smaller companies may not have the resources to offer competitive salaries.
Location also plays a role in determining your earnings. Working in metropolitan areas can lead to better earning prospects compared to smaller cities due to the higher demand for risk analysts. In general, the remuneration package for risk analysts is driven by the demand for their skills.
types of risk analysts
The types of risk analysts depend on the area of specialisation. These include:
- credit risk analysts: as a credit risk analyst, you determine the ability of a client to pay a loan. You work in an investment bank, mortgage firm or insurance company to determine the risk of giving out a loan to a client. You analyse financial data and credit worthiness of clients.
- regulatory risk analyst: as a regulatory risk analyst, you analyse policy or legislation changes and their impact on the company. For instance, you determine the impact that disciplinary actions and fines on loans have on the financial institution's reputation.
- market risk analysts: as a risk analyst, you analyse and review the stock market to check your company's share price. You check the economic trends and financial data to identify the risks to the company's assets and investments.
working as a risk analyst
Working as a risk analyst is an exciting career that involves reviewing markets and stocks. Let’s explore the duties, work environments and schedules of the role.
education and skills
You require educational qualifications and experience to succeed as a risk analyst. Some of the academic requirements include:
- bachelor’s degree: you can become an entry-level risk analyst by pursuing a bachelor’s degree. Complete an undergraduate in commerce or financial management. Other related fields include computer science, statistics and mathematics. The courses equip you with analytical, statistical modelling and data analysis skills. Alternatively, complete a graduate degree in an analytical discipline or a technical field. For instance, complete a master's in financial markets and risk management.
- work experience: to work as a risk analyst requires extensive experience. Some companies require a minimum of five years of work experience in a relevant field. You can start with entry-level jobs in financial services, insurance companies or junior risk analysis roles.
risk analyst skills and competencies
Some of the skills and qualities of a risk analyst include:
- analytical skills: as a risk analyst, you spend considerable time analysing large data collections. For instance, you review market trends and investment portfolios. You also research financial data to determine creditworthiness and evaluate other risks. Your analytical skills help you analyse large volumes of data using statistical models to make the right conclusions.
- decision-making skills: as a risk analyst, you help financial advisors and financial planners make business and financial decisions on behalf of their clients. You require good decision-making skills to quickly analyse the data from your clients and make a decision.
- communication skills: as a risk analyst, communication skills are valuable. You possess strong written and verbal communication skills, enabling you to communicate clearly with clients. Your ability to explain technical terms in simple language is useful when explaining the risk analysis process to clients or stakeholders.
- project management skills: as a risk analyst, you work on multiple projects and handle various aspects of finance operations. You require project management skills, such as organisation and time management, to ensure that all projects are completed on time.
FAQs about working as a risk analyst
Here, you will find the answers to the most frequently asked questions about the profession of a risk analyst.