300+ Research Analyst Interview Questions and Answers

Bottom-up analysis involves analyzing individual components of a company or industry to form a complete picture.

• Start by analyzing individual companies or industries

• Look at financial statements, market trends, and industry reports

• Use this information to form a complete picture of the industry or market

• Example: Analyzing individual companies in the tech industry to form a complete picture of the industry as a whole

Marginal costs refer to the cost of producing one additional unit of a product, while additional costs refer to any extra costs incurred beyond the initial cost.

• Marginal costs are the cost of producing one more unit of a product, while additional costs are any extra costs incurred beyond the initial cost.

• Marginal costs are variable costs that increase or decrease with the production of one more unit, while additional costs can be fixed or variable costs.

• For example, if a comp...read more

Derivatives are financial instruments whose value is derived from an underlying asset or group of assets.

• Types of derivatives include options, futures, forwards, and swaps.

• Mutual funds are investment vehicles that pool money from multiple investors to invest in a diversified portfolio of securities.

• Common ratios used in financial analysis include price-to-earnings ratio (P/E), return on equity (ROE), and debt-to-equity ratio.

To provide a rough analysis of revenue, sales, and expenditure for a company investing in a specific sector in India.

• Analyze the current market size and growth rate of the sector in India

• Evaluate the competitive landscape and market share of existing players

• Assess the regulatory environment and government policies impacting the sector

• Analyze the target company's financial statements, revenue streams, and sales projections

• Evaluate the company's expenditure on operations, marke...read more

The Boeing 737 Max crashes were negative news for Boeing

• The crashes of two Boeing 737 Max planes in 2018 and 2019 resulted in the deaths of 346 people

• The crashes were caused by a faulty automated system that pushed the planes into nosedives

• Boeing's stock price dropped significantly following the crashes and the subsequent grounding of the 737 Max fleet

• The company faced lawsuits, investigations, and a loss of trust from customers and the public

It is impossible to accurately estimate the number of chairs in Pune without specific data.

• The number of chairs in Pune would depend on various factors such as population, number of households, businesses, etc.

• Without specific data on the number of establishments, households, and public spaces in Pune, it is impossible to accurately estimate the number of chairs.

• One would need to conduct a comprehensive survey or study to determine the approximate number of chairs in Pune.

I would systematically clean, explore, and analyze the dataset to derive actionable insights for business strategies.

• Data Cleaning: Remove duplicates and handle missing values. For example, if a transaction has a missing customer ID, decide whether to fill it or drop it.

• Data Transformation: Standardize formats (e.g., date formats) and create new variables. For instance, extract month from transaction dates for seasonal analysis.

• Exploratory Data Analysis (EDA): Use visualizati...read more

Mutual funds are investment vehicles that pool money from multiple investors to invest in a diversified portfolio of securities.

• Types of mutual funds include equity funds, debt funds, balanced funds, index funds, and sector funds.

• Stock split is when a company increases the number of shares outstanding by issuing more shares to current shareholders.

• Ex-dividend is when a stock trades without the dividend payment included in the share price.

• Bonus shares are additional shares giv...read more

I would review the method development process, identify potential errors or issues, and troubleshoot to determine the cause of the discrepancy.

• Review the method development process to ensure all steps were followed correctly

• Check for any potential errors in the experimental setup or data analysis

• Verify the accuracy of the instruments and equipment used

• Consult with colleagues or experts for input and advice

• Perform additional experiments or tests to validate the results

I have worked on various technology verticals including software, telecommunications, and e-commerce.

• Software: Estimating market size by analyzing sales data, conducting surveys, and tracking industry trends.

• Telecommunications: Estimating market size by analyzing subscriber data, conducting market research, and studying industry reports.

• E-commerce: Estimating market size by analyzing online sales data, conducting customer surveys, and studying market research reports.

Fundamental analysis is a method of evaluating a security by examining its intrinsic value.

• It involves analyzing financial and economic data to determine the underlying value of a security

• The objective is to identify undervalued or overvalued securities

• Factors considered include financial statements, industry trends, management quality, and macroeconomic conditions

• Example: analyzing a company's revenue growth, profit margins, and debt levels to determine its true value

• The goa...read more

5G offers faster speeds, lower latency, increased capacity, improved reliability, and support for more devices.

• Faster speeds compared to 4G, enabling quicker downloads and smoother streaming

• Lower latency for real-time communication and better gaming experiences

• Increased capacity to handle more connected devices in crowded areas

• Improved reliability for mission-critical applications like autonomous vehicles

• Support for emerging technologies like IoT and virtual reality

It is not possible to cut a cake into 8 pieces with only 3 cuts.

• To cut a cake into 8 pieces, you need at least 7 cuts.

• Each cut divides the cake into 2 pieces, so 3 cuts can only divide the cake into 4 pieces.

• To get 8 pieces, you need to make 7 cuts by cutting the cake into halves and then quarters.

Use 3L and 5L buckets to measure exactly 4L in a third bucket through a series of filling and pouring steps.

• Fill the 5L bucket completely.

• Pour from the 5L bucket into the 3L bucket until the 3L bucket is full, leaving 2L in the 5L bucket.

• Empty the 3L bucket.

• Pour the remaining 2L from the 5L bucket into the 3L bucket.

• Fill the 5L bucket again completely.

• Pour from the 5L bucket into the 3L bucket until the 3L bucket is full (which already has 2L), leaving exactly 4L in the 5L bu...read more

Accrued expenses are liabilities that have been incurred but not yet paid for.

• Accrued expenses are recorded on the balance sheet as a current liability.

• They represent expenses that have been recognized but not yet paid for.

• Examples of accrued expenses include salaries payable, interest payable, and utilities payable.

• Accrued expenses are typically recorded through adjusting entries at the end of an accounting period.

ESG stands for Environmental, Social, and Governance. It is a framework used to evaluate a company's sustainability and ethical practices.

• ESG factors are used by investors to assess a company's long-term financial performance and risk.

• Environmental factors include a company's impact on climate change, natural resource depletion, and pollution.

• Social factors include a company's impact on human rights, labor practices, and community relations.

• Governance factors include a compan...read more

If cigarettes are banned by the government in India, it would have significant social, economic, and health implications.

• Reduction in smoking-related health issues and diseases

• Decrease in tobacco-related deaths

• Positive impact on public health and healthcare costs

• Potential increase in illicit tobacco trade

• Loss of revenue for the government

• Impact on tobacco farmers and related industries

• Changes in social behavior and cultural practices

Balance sheet, income statement, and cash flow statement are three key financial statements used to assess the financial health of a company.

• Balance sheet provides a snapshot of a company's financial position at a specific point in time, showing assets, liabilities, and equity.

• Income statement shows a company's revenues, expenses, and profits over a specific period of time.

• Cash flow statement tracks the flow of cash in and out of a company, detailing operating, investing, and...read more

The exact number of street lights in Pune is not available.

• There is no official data available on the exact number of street lights in Pune.

• The number of street lights may vary depending on the area and population density.

• The Pune Municipal Corporation is responsible for the maintenance of street lights in the city.

• The number of street lights may have increased over the years due to urbanization and population growth.

The question asks about calculating cumulative sum of an array and frequency of each word in a sentence.

• To calculate cumulative sum of an array, we can use a loop and keep adding the current element to a running sum variable.

• To calculate frequency of each word in a sentence, we can split the sentence into words and use a dictionary to keep track of the count of each word.

• We can use built-in functions in programming languages like Python to perform these tasks efficiently.

Enterprise Value is the total value of a company's equity and debt.

• Enterprise Value = Market Capitalization + Total Debt - Cash and Cash Equivalents

• It is used to determine the total value of a company, including its debt

• EV is often used in financial analysis to compare companies with different capital structures

• Example: If a company has a market cap of $100 million, total debt of $50 million, and cash and cash equivalents of $10 million, its EV would be $140 million

Calculating FCF, EBITDA, adjusted EBITDA, funding FCF deficit, and adjusting debt for off balance sheet leases in research analysis.

• To calculate Free Cash Flow (FCF), subtract capital expenditures from operating cash flow.

• EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) is calculated by adding back interest, taxes, depreciation, and amortization to net income.

• Adjusted EBITDA is EBITDA adjusted for non-recurring expenses, gains, or losses.

• To fund FCF de...read more

As a research analyst, I would systematically approach the case using structured methodologies and analytical tools.

• Define the research question clearly to understand the scope and objectives.

• Gather relevant data from credible sources, such as academic journals or industry reports.

• Analyze the data using statistical tools or software to identify trends and insights.

• Interpret the findings in the context of the research question and draw actionable conclusions.

• Communicate the re...read more

Quantitative analysis involves numerical data while qualitative analysis involves non-numerical data.

• Quantitative analysis deals with measurable data and statistical methods.

• Qualitative analysis deals with non-measurable data and subjective methods.

• Quantitative analysis is used to test hypotheses and make predictions.

• Qualitative analysis is used to gain insights and understand complex phenomena.

• Examples of quantitative analysis include surveys, experiments, and statistical mo...read more

Provision is a liability that is uncertain in timing or amount, while reserve is a portion of profits set aside for specific purposes.

• Provision is a liability that is recognized in the financial statements when there is uncertainty about the timing or amount of an obligation.

• Reserve is a portion of profits that is set aside by a company for specific purposes, such as future investments, contingencies, or dividends.

• Provisions are made for known liabilities, such as bad debts, ...read more

An equity stock holder is an individual or entity that owns shares of a company's stock.

• Equity stock holders have ownership in a company and are entitled to a portion of its profits.

• They can vote on important company decisions and attend shareholder meetings.

• Examples of equity stock holders include individual investors, mutual funds, and pension funds.

Financial statements are formal records of the financial activities and position of a business, person, or entity.

• 1. Balance Sheet: Shows assets, liabilities, and equity at a specific point in time. Example: A company with $500,000 in assets and $300,000 in liabilities.

• 2. Income Statement: Reports revenue, expenses, and profit over a period. Example: A company earns $1 million in revenue and incurs $800,000 in expenses, resulting in a $200,000 profit.

• 3. Cash Flow Statement: T...read more