What Does a Quantitative Risk Analyst Do?

D. Grey
D. Grey
Businessman with a briefcase
Businessman with a briefcase

A quantitative risk analyst determines and defines the risk posed by human behavior and natural disasters to government organizations, businesses, and individuals. An analyst takes all available data into account and calculates the likely effect of these events. He or she may be required to sift through a great deal of information before being able to make an accurate prediction.

For governments, quantitative risk analysts examine data regarding specific areas within the government. They might examine many sectors of an organization and calculate the effects of events on an even larger scale. Many military operations take into account the advice of a quantitative risk analyst. In this case, the risks being assessed might relate to an operation being carried out, expected casualties, or potential threats that jeopardize the success of the mission.

In the business sector, quantitative risk analysts perform a function similar to that of their governmental counterparts. Their job duties reflect the needs of the businesses they work for, with a focus on uninterrupted production and the continued profitability of the business. The analyst might assess the potential risk of financial investments or security threats. For example, an analyst might provide data to a private company on the likelihood of theft or fraud. The analyst will incorporate data from various public and private sector resources and tailor their risk assessments to the specific concerns of the businesses for which they work.

Risk analysts working for individuals determine the risk that certain events pose to these individuals, and examine detailed data about what this risk could mean. Security teams or bodyguards providing personal protection for an individual might have an analyst examine potential threats based on the location the client is going to. When working for individuals, analysts usually focus solely on the individual's concerns and likely risk outcomes, whether for personal safety or financial investments. While individual needs may not be as expansive as those of a business or government, the quantitative risk analyst's job duties may be just as complex.

In all sectors, public, private, and individual, quantitative risk analysts often use data that is already available in their analysis of likely outcomes. To do this job, risk analysts absorb data in many formats on relevant subjects. A financial risk analyst investigating an investment that his or her client is considering might examine a great deal of data other than just the primary investment. This might include the impact other companies have on the investment or may be expected to have in the future. Environmental or social concerns might also be involved in the analysis.

Anyone employed as a quantitative risk analyst will have to work with data from sources all over the world. The global nature of risk analysis may require the incorporation of foreign language information and data obtained in formats that are not globally standardized. In these cases, quantitative analysts may be called upon to verify the sources before adding the information to their overall analysis data.

Quantitative risk analysts gather relevant data and process it into meaningful information. They usually create a combined analysis of this data for further study. After estimating what the effect of a given risk will be, the analyst may propose methods to lessen or eliminate the risk.

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      Businessman with a briefcase