How do investment analysts decide where it's best for your money to go?

The Money Show's Stephen Grootes is joined by Mbasa Mrwetyana from Mazi Asset Management and Differential Capital's Musa Malwandla.

Financial analysts are regularly featured on The Money Show to offer their specialised insights on a range of investment topics.

But how do these analysts themselves decide where your money should go (and justify earning their commission)?

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Research on the companies being considered for investment is key, says Mbasa Mrwetyana, Deputy Head of Research at Mazi Asset Management.

"We collect information, we analyse that information, and we generate actionable insights. That's how we come up with a recommendation which is either to buy or sell."

Mbasa Mrwetyana, Deputy Head: Research - Mazi Asset Management

This recommendation is at the core of their work for the client, Mrwetyana says.

The backdrop to what they advise includes a financial model and all the insights the analysts have collected, which requires, or should require, a lot of checks.

"These insights can come from the financial information that the company discloses, including an annual report. It can also involve speaking to industry experts along with getting information from management teams themselves."

Mbasa Mrwetyana, Deputy Head: Research - Mazi Asset Management

Hear more about what it takes to be a good financial analyst in the interview audio at the top of the article