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NISM-Series-XV: Research Analyst · Introduction to Research Analyst Profession

Role of a Research Analyst in NISM Series XV

Updated 11 October 2026 · Fact-checked

A research analyst studies securities, companies, industries and the economy, then forms a view and communicates it through research reports or recommendations. The work helps investors decide whether to buy, hold or sell. To solve exam questions, identify the function described, who uses the output, and whether the analyst is buy side or sell side.

Understand Role of a Research Analyst

A research analyst collects information, analyses it and turns it into an opinion that helps others make investment decisions. The opinion may be about a company, a sector, a bond, a commodity or the economy. The output is usually a research report or a recommendation.

The role is needed because investors cannot read every balance sheet, industry data set or policy announcement. Analysts do this work, check facts, apply valuation methods and explain what the information means for the price or risk of a security.

The main functions are:

  • Gathering and checking data from company filings, industry sources and economic releases.
  • Analysing the economy, the industry and the company.
  • Valuing the security and estimating its fair value.
  • Forming a view and presenting it, with assumptions and risks, in a clear report.
  • Monitoring the security and updating the view when facts change.

Analysts work on two sides. Sell-side analysts work for brokerages and similar firms. Their research is published to clients and supports the firm's services. Buy-side analysts work for institutions that invest money, such as mutual funds, insurers and portfolio managers. Their research is usually used internally to make the institution's own investment decisions.

Research also supports the market as a whole. It helps prices reflect available information, helps investors compare choices, and improves transparency. In India, persons who provide research analysis or reports to clients are regulated by SEBI, so the profession carries duties of honesty, disclosure and independence.

Key formulas to remember

Core chain of the role
Data → Analysis → Valuation → View → Report → Decision support
Use this to place any function in the right stage.
Sell side vs buy side
Sell side: research published to clients | Buy side: research used internally by the investing institution
Remember who uses the output. That separates the two.
Scope of analysis
Economy → Industry → Company
A top-down view. Analysts look at each level before valuing a security.

How to solve Role of a Research Analyst questions

Use this method for any question on the role of a research analyst.

  1. 1Read the stem and mark the key words: function, user, employer, or purpose.
  2. 2Decide whether the question is about what an analyst does, who uses the work, or why research matters.
  3. 3If employer or user is mentioned, decide buy side (internal investing use) or sell side (published for clients).
  4. 4Match the activity to a stage: data gathering, analysis, valuation, view, reporting or monitoring.
  5. 5Remove options that describe other roles, such as executing trades, guaranteeing returns or managing client money without research.
  6. 6Choose the option that fits the analyst's role of informing decisions, not making guarantees.

Quickest way: Who uses it, and what is it for?

When to use it: Use it when options look similar and you have under a minute.

  1. Ask: is the work informing a decision or executing one? Research informs.
  2. Ask: is the output going to outside clients or staying inside an investing firm? Clients means sell side, internal means buy side.
  3. Reject options that promise returns, certainty or guaranteed outcomes.
  4. Pick the option that mentions analysis, valuation or a view supported by facts.

Common mistakes in Role of a Research Analyst

  • Treating the analyst as someone who guarantees returns.

    Students confuse a recommendation with an assurance.

    Fix: A recommendation is an opinion based on analysis. It carries risk and never guarantees returns.

  • Mixing up buy side and sell side because of the words.

    The names sound like buying and selling securities for clients.

    Fix: Sell side means the research is sold or supplied to clients. Buy side means the institution buys securities for its own portfolio and uses research internally.

  • Thinking research is only about company financials.

    Most study time goes to ratios.

    Fix: Analysts also study the economy, the industry and the business model. Remember economy, industry, company.

  • Confusing the analyst with a trader or dealer.

    All work in the securities market.

    Fix: The analyst produces views and reports. Trading and execution are separate functions.

  • Ignoring the monitoring function.

    Students stop at the report.

    Fix: Analysts update views when results, policy or events change the facts.

Worked examples

Example 1

An analyst at a mutual fund studies a listed company and gives her view only to the fund's portfolio managers, who decide the fund's purchases. Which type of analyst is she?

Show the solution
  1. Identify the employer: a mutual fund, which invests money.
  2. Identify the user: the fund's own portfolio managers.
  3. Internal use for the institution's own investment decisions means buy side.

Answer: She is a buy-side analyst.

Example 2

Which of the following best describes the role of a research analyst? (a) Guaranteeing a minimum return to investors (b) Analysing information and forming a reasoned view to support investment decisions (c) Executing client orders on the exchange (d) Clearing and settling trades

Show the solution
  1. Recall that an analyst's output is an opinion supported by analysis.
  2. Option (a) is wrong because returns cannot be guaranteed.
  3. Options (c) and (d) describe broking and clearing functions, not research.
  4. Option (b) matches the role.

Answer: Option (b).

Exam tips

  • Expect direct questions on functions of an analyst and the buy side versus sell side distinction.
  • Reject any option that promises returns or certainty.
  • For employer-based questions, link the analyst to the user of the research.
  • Use the economy, industry, company order to answer scope questions.
  • Read for words like 'primarily' or 'best describes', then pick the most complete fit.

Practice questions from Introduction to Research Analyst Profession

Role of a Research Analyst in other exams

The same ground in other exams, if you are preparing for more than one or want another angle on it.

Role of a Research Analyst: frequently asked questions

What does a research analyst do in India?

A research analyst studies securities, companies, industries and the economy and forms a view. The view is shared through reports or recommendations that help investors decide. The activity is regulated by SEBI.

What is the difference between buy-side and sell-side analysts?

Sell-side analysts work for firms such as brokerages and publish research to clients. Buy-side analysts work for investing institutions like mutual funds and use research internally for their own investment decisions.

Can a research analyst guarantee returns?

No. A recommendation is an opinion based on analysis and assumptions. Actual outcomes can differ, so risks should be disclosed.

Is this topic important for NISM Series XV?

It sits in the first chapter, Introduction to Research Analyst Profession, which is a small chapter in the exam. Questions are usually direct, so the marks are easy to secure with clear definitions.