What to Learn After Financial Modeling

Take a deep dive into financial modeling and learn how it provides critical insights into a business's performance based on various financial outcomes. Discover the importance of advanced Excel skills and investment strategies in constructing effective financial models and making sound business decisions.

Key Insights

  • Financial modeling is a critical process that estimates a business or project's financial performance by considering growth and risk assumptions and relevant factors.
  • It is a valuable tool used in various industries to aid in business growth, mitigate risk, and increase profits by performing detailed analyses of possible financial outcomes.
  • Advanced Excel skills, such as working with INDEX and MATCH, What-If Analysis for Goal Seek and Data Tables, and creating macros, are integral in constructing sound financial models.
  • Financial modeling is crucial in investment banking and private equity, aiding in making more sound investment decisions and opening up opportunities for Sophisticated Investors.
  • Noble Desktop offers comprehensive courses in financial modeling, including a Financial Modeling Bootcamp and a Financial Analyst Training Program, both incorporating hands-on training with Excel.
  • Financial models are not only used to solve problems but also to make future outcome decisions like estimating a company's projected growth, organizing its budget, and deciding between acquisition or merger.

Financial modeling is estimating how a business or project will perform financially by considering growth and risk assumptions, as well as each relevant factor. This process can provide a concise overview of the different variables involved with a financial forecast and their impact. If you already know how to use financial modeling, you might consider learning advanced Excel skills and investment strategies. We’ll cover these skills below so you clearly understand what skill you want to tackle next. 

What is Financial Modeling?

Financial modeling is the process of evaluating a company’s past performance to predict the likelihood of various financial outcomes. Those who create financial models rely on financial forecasts to do so. The assumptions in a forecast are played out using the organization’s financial statements to predict how various statements may look in the future. Since these models are based on financial statements, they are typically generated monthly, quarterly, or yearly. It’s common for financial models to be constructed using manual data entry in an Excel spreadsheet. 

Financial modeling is a valuable tool for estimating how a business or a specific project will perform based on relevant factors, as well as risk assumptions and growth, then evaluating their impact. This process helps to present a concise understanding of the variables used to make financial forecasts. Those who create financial models either build them from scratch or work with existing models, making changes based on newer data that’s become available since its creation. Because financial situations are complex and can change quickly and rapidly, financial modeling helps to create a detailed understanding of the different components.

Read more about what financial modeling is and why you should learn it

What Can You Do with Financial Modeling?

Without well-executed financial modeling, any business operation would be analogous to a ship floating aimlessly in the sea with no navigation system. Although one could use gut instinct to steer the ship in the correct direction, there would be no guarantee that this course would be accurate. The more sound a financial model is, the less unnecessary risk a business will likely encounter. And the less likely it will be to drift aimlessly. 

Financial modeling has numerous applications across industries. Strong financial models are the backbone of many businesses and are a critical component to help them continue to grow and mitigate risk. Financial models provide a way to perform a detailed analysis of all possible financial outcomes of a business decision. These models seek to avoid loss as well as increase profits.

Financial modeling is a powerful tool for a range of financial analysis tasks. It can help an organization budget for the future and analyze the company’s performance against goals and targets. It also can be used for business valuation. Financial models allow individuals to compare one company’s performance against its competitors. It is often used to analyze financial statements, ratios, and capital structure, as well as to estimate financial metrics for new projects. Not only are these models imperative for solving problems, but they are used to make decisions about future outcomes. Some of the many decisions financial models can help with are estimating a company’s projected growth, organizing its budget, choosing investments, deciding between acquisition or merger, and deciding which projects should be prioritized.

Advanced Excel Skills

Because financial modeling relies heavily on Excel knowledge, the more training you have with advanced Excel functions, the easier it will be to create sound financial models. Some advanced Excel skills that can help you with financial modeling are advanced database functions like INDEX and MATCH and What-If Analysis for Goal Seek and Data Tables. Learning to create macros and work with Excel’s built-in programming language, VBA, are valuable skills to help with modeling tasks.

Noble Desktop includes advanced Excel training as part of its in-person and live online Financial Modeling Bootcamp. Those who only need to study advanced Excel techniques can instead enroll in Noble’s Excel Level 3: Advanced course.

Advanced Investment Strategies

Financial modeling is crucial in helping Investment Bankers and Private Equity Associates make more sound investment decisions. Those who have already learned to create reliable financial models and have acquired sufficient capital may consider pursuing additional investment opportunities. Sophisticated Investors are an investor classification that signifies the individual has the necessary net worth and capital to perform advanced forms of investment. With their extensive market knowledge, these investors are sometimes eligible for specific investment opportunities that aren’t offered to other Investors. Sophisticated Investors typically don’t need to liquidate investment assets in the short term; they can also handle an investment loss without significantly damaging their net worth. 

Learn Financial Modeling with Hands-on Training at Noble Desktop

Noble Desktop offers several excellent learning options for those interested in studying financial modeling. Noble’s Financial Modeling Bootcamp covers the basics of accounting, finance, and corporate valuation. Those enrolled in this hands-on class work with Excel to create a discounted cash flow model. Students who don’t have a background in accounting or finance will be sent a short guide on terminology before class starts. All participants should have intermediate Excel proficiency as a prerequisite.

Noble’s Financial Analyst Training Program provides learners with instruction on pertinent corporate and financial concepts and how to create a full valuation model. This intensive program teaches core Excel skills, like how to work with PivotTables and shortcuts, as well as advanced Excel techniques, including cash flow projection tools and Goal Seek. All students will create an integrated, three-statement financial model based on current financial data.

Noble also offers financial modeling training courses in-person and live online. Those interested in learning more about how to use Excel for modeling can attend the Excel Bootcamp. In addition, FinTech courses such as Python for Data Science Bootcamp, Algorithmic Trading With Python, and FinTech Bootcamp are also available. Noble’s FinTech Bootcamp provides hands-on training from expert instructors in creating machine learning models, using programming languages like SQL and Python to analyze financial data, and working with various types of data, such as integers, strings, and floats. One-on-one mentoring and the option of a free course retake is included for all participants. 

Key Insights

  • Financial modeling is a powerful tool that provides insights into how a company or project will perform financially in the future.
  • Strong financial models have applications across industries. They help companies mitigate risk and continue to grow and increase profits.
  • Once you’ve learned how to create financial models, you may consider learning more advanced Excel skills, such as INDEX and MATCH, or considering advanced investment strategies.
  • Suppose you want to learn more about how you can work with Excel to create financial models. In that case, Noble Desktop’s financial modeling courses are a great learning opportunity.

How to Learn Financial Modeling

Master financial modeling with hands-on training. Financial modeling is a technique for predicting the financial performance of a business or other type of institution over time using real-world data.

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