Career Path Guide
If you want to become a risk analyst, you first need to determine if this career path is a good fit for your skills, interests and personality traits. If the following description sounds like you, then you’re probably well suited for work in this field:
• You enjoy reviewing financial and accounting documents, industry developments and related resources
• You have an interest in risk mitigation and coverage
• You enjoy analyzing research data
• You have mathematical, analytical and business communication skills
• You are interested in a lucrative career
• You enjoy working in a corporate environment
Below we've outlined what you'll need to begin your journey into this occupation. We've also included helpful information for this career, such as job description, job duties, salary expectations, a list of possible employers and much more!
Required Education
Undergraduate Degree: Although the educational requirements vary by employer, you typically need an undergraduate degree in a field such as finance, economics, computer science, mathematics, statistics, or any other field that demonstrates your ability to understand and work with numbers and financial information.
Regardless of the degree you pursue, you should consider taking courses in risk management (if they are available), as they are very helpful for a career as a risk analyst. A degree in an industry-related program, may also be considered an asset. For example, a degree in geology or petroleum engineering is considered an asset for risk analysts working in the oil and gas industry.
Graduate Degree: A graduate degree, such as an M.Sc. in risk management or financial markets, can also significantly improve your employment prospects, as organizations that employ risk analysts tend to prefer candidates with graduate degrees. A graduate degree is particularly helpful for candidates with an undergraduate degree that isn’t directly related to risk management.
Getting an entry-level job in risk analysis, such as Risk Analysis Technician, may be possible without a degree, although experience in finance or insurance is usually required, along with an assortment of professional qualifications.
Risk Analyst Job Description
Risk analysts are responsible for identifying and analyzing areas of potential risk that threaten the assets base, earning capacity, and general financial success of the private or public sector organizations that employ them or contract their services. They must then develop and present risk mitigation and coverage recommendations based on their analysis.
These recommendations they present may include strategies for minimizing risks and maximizing rewards, and making sure that their employer’s operations comply with financial regulations and other statutory requirements.
There are many operational sectors in which risk analysts may work; they may work in sales, origination, trading, marketing, financial services or private banking. Risk analysts may also specialize in one of the four major risk categories:
Credit risk specialists: Analyze the risk to the company of its customers not paying for goods or services, or defaulting on loans and credit.
Market risk specialists: Analyze the potential negative impact that outside factors could have on the company’s share price, or the market in general. May also make recommendations to limit company's investment portfolio risk through diversification, currency exchanges and other investment strategies.
Operational risk specialists: Analyze the likelihood and potential impact of risky operational events, such as system failures, employee fraud.
Regulatory risk specialists: Analyze the potential impact that newly introduced, or forthcoming legislation will have on the organization.
Risk Analyst Job Duties
The job duties of a risk analyst can vary on their area of specialty, the specific responsibilities of their job, and many other factors. In general however, risk analysts are responsible for performing the following duties:
• Review financial and accounting documents, industry developments and other resources
• Research current events, and anticipate their possible effect on the economy and the financial services industry
• Study government legislation and advise company on compliance
• Work with traders to analyze the risk associated with specific transactions
• Use quantitative analysis, statistical models and valuation tools and techniques
• Develop contingency plans to deal with emergencies
• Monitor and forecast market trends
• Present ideas via reports and presentations, and make recommendations for improvements based on findings
• Use of statistical software and other related computer applications
• Make recommendations to reduce or control risk, which may involve the development of an insurance strategy
Who Creates Jobs for Them?
Risk analysts are typically hired on a full-time or contractual basis by a wide variety of organizations. Competition for risk analyst jobs is keen, no matter who the employer is, so ensure you acquire the proper skill set that employers are looking for.
Organizations that employ Risk Analysts include:
• Insurance firms
• Financial services firms
• Mortgage firms
• Commercial and investment banks
• Risk management consulting companies
• Large private and publicly traded companies in a variety of industries
• Federal, provincial/state and municipal government departments
Experience Needed
The experience requirements also vary by employer. Some employers may hire you directly out of school into a risk analysis or management training program, while others will only hire you if you have years of professional experience in roles of progressive responsibility.
Success Tip: Gaining real-world experience through internships will give you a competitive advantage. In fact, many employers offer full-time jobs to competent interns once they have graduated from their program.
Required Skills
In order to become effective in a career as a risk analyst, you need to posses a certain set of skills. Employers of risk analysts typically seek candidates with analytical and mathematical skills and abilities, as well as general business skills. You will likely need to see evidence of them on your resume when applying for risk analyst jobs.
• Familiarity with quantitative analysis techniques
• Strong knowledge of industry employer operates within
• Proficient in analyzing financial statements
• Able to work under firm deadlines
• Able to prioritize and balance workload
• Computer literacy; proficient in MS Office applications (Excel, Word, Outlook, PowerPoint)
• The ability to present complex concepts to a wide audience
• Project management skills
• A proven ability to identify opportunities to improve performance and reduce inefficiencies in existing systems
Helpful Traits and Characteristics to Have
In order to enjoy performing the duties of a risk analyst, you need to have certain personality traits and characteristics. Taking enjoyment from your duties as a risk analyst is important, as it helps you maintain a positive attitude towards your work, which usually leads to having a long and successful career.
• A keen interest in mathematics and data analysis
• Enjoy developing strategies to mitigate risk
• Enjoy consulting with others and presenting recommendations
• Enjoy reviewing financial and accounting documents, industry developments and related resources
• Enjoy synthesizing information and taking a methodical approach to work activities
• High ethical standards
Salary Figures
The salary level these professionals earn can vary depending on their level of education, their level of experience, their demonstrated abilities, the size and type of their employer, and many other factors.
Please note, there is no reliable salary data available specifically for Risk Analysts, although we can get a good idea of what they earn by looking at the salary level of closely related professions.
Salary in Alberta: According to the 2011 Alberta Wage and Salary Survey, Albertans working in the Mathematicians, Statisticians and Actuaries occupational group have an average income level of between $31.69 and $43.46 per hour.
United States: According to the United States Bureau of Labor Statistics, the median salary level of American workers in the Actuaries occupational group is $93,680 per year.
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Similar Occupations in Our Database
Listed below are careers in our database that are similar in nature to Risk Analyst, as they may involve many of the same skills, competencies and responsibilities.
• Actuary
References
Please consult the references below to find more information on the various aspects of working in this field:
Occupations in Alberta: “Actuary.” (March 3, 2016). ALIS website - Alberta Learning Information Service. Retrieved January 12, 2020.
Math: “Actuaries.” (December 3, 2019). Bureau of Labor Statistics - United States Government website. Retrieved January 12, 2020.
Job Profile: “Financial risk analyst.” AGCAS editors (June, 2019). Prospects website. Retrieved January 12, 2020.
Relevant Scholarships
Scholarships listed for majors that apply to becoming a Risk Analyst can be found on the following pages:
Success Tip: Be sure to apply for any scholarships that you even barely qualify for, as there are millions of dollars of scholarships that go unused every year due to a lack of applicants!
Applicable Majors for This Career
Studying one of the university majors listed below is an excellent starting point to becoming a risk analyst. Click on the links to find out what else you can do with these majors!
