Areas of Finance Education You Should Know

Finance is a broad term referring to things about the management, generation, allocation, and planning of funds and investments. The field is vast and involves many specific fields. The most famous among them are investment banking, venture capital, real estate and insurance. Finance also has many subtopics such as risk management, market pricing, asset pricing, credit, derivatives, foreign exchange, money management and financial markets. There is also much less commonly known branch of finance called non-financial finance.

Bank financing is required for banks to function. The term is used in place of banks. Banks do not actually engage in the business of making loans, but they do make loans through legal procedures. Finance is required to ensure that bank loans are repaid. Other types of commercial finance includes: mortgages, lines of credit, commercial mortgage loans, merchant cash advances, business mortgages, business finance, business loans, and industrial cash advances.

Finance is required to understand the financial systems of a country. It includes the total income of a nation’s producers and the total expense of its consumers, both fixed and variable. There is a constant link between production and costs of production and the level of employment. Finance is also required to ensure the smooth functioning of the financial sector. There are two main branches of the financial system, namely economic growth and financial system.

Accounting is one branch of finance that most people have heard of even if they have not studied finance. Accounting studies financial records to determine the performance of a company or an institution. Many organizations now conduct their accounting on computers and with the aid of modern software. There are also several versions of accounting such as information systems, assurance systems, portfolio analysis, management systems and financial models.

Finance study is required in all countries. Finance graduates usually go to business schools to find out more about the capital markets and banking systems of their countries. These students may decide to specialize in either one or two fields depending on their interests. Banking specialists go on to get jobs as bank regulators, economists, investment managers or treasurers.

Investment is the best way to make money quickly and easily. Some people make money through the sale of stocks and shares or by building private capital. All the forms of investments need financing and there are different types of funds available for different purposes. Hedge funds, venture capital funds, pooled investment funds are some examples of the various kinds of funds that finance the economy.

Finance education focuses on the use of financial tools to determine the viability of investments. There are many books, articles and videos that discuss the topic of finance. One can also take part in finance workshops organized by banks and other financial institutions. The first step towards understanding the finance is to get a basic understanding of the capital markets and how they work. This will give a good foundation for understanding the different investments and their return on investment.

Finance graduates with an MBA in finance can go on to become investment bankers, fund managers and financial analysts. Those who have finance degrees can also work as financial planners or actuaries. They can also work as chief financial officers for large corporations. Whatever the choice of profession is better with financial education than without it.

Accounting is the second aspect of the finance curriculum that students should be familiar with. Accounting gives a detailed picture of financial transactions and the activities associated with them. Examples of accounting procedures are: financial reporting, internal control, taxation, financial risk management etc. Financial accounting includes a wide range of activities like: financial analysis, budgeting, policy planning and investment strategy, measurement of risks, valuation of securities etc.

Wealth management is another important part of finance education. The wealth manager manages a set of assets or accumulated funds. It is the task of a wealth manager to protect the wealth or to increase its value. Some examples of wealth management strategies include asset allocation, estate planning, charitable donations, investments, retirement plans etc. A wealth manager is required to have extensive accounting knowledge as well as vast knowledge of the stock market and the stock exchange market. For those who want to make a career as wealth managers, a two-year postgraduate degree in accounting is a must.

The third area of finance curriculum that is important to understand is investment. Investment refers to the purchase of securities (including shares) in order to earn a return. Most people invest in stocks, bonds, mutual funds and other securities to gain returns. In order to achieve the best investment returns, investors need to carefully choose their funds and consider their risk/reward balance. Learning about investment strategies, mutual funds and other instruments is an important part of one’s financial planning and development.

Author: Patrick Robinson