Finance is freedom, not a burden, if cycled properly

Dear Readers, I am much grateful to you all for going through my previous article in which I’ve shared my articleship and industrial training experience. I’m gain here to take you through this esoteric topic on “Areas in Finance”.

I would not start with a traditional definition of Finance instead I would ask you to think of this word called “Freedom”, yes “Freedom”. Finance is something that would bring anybody the freedom to be financially free. Finance is simply a key ingredient in order to start something with. Yes, it is easy to understand. The only thing required is a simple brain to get things into. Now, I would ask you all to keep the word “Freedom” in mind till the time you finish reading.

As everything has a starting and an ending point, so does finance has. Finance is a huge subject to learn that has many branches and it really requires thinking from multiple perspectives. I will now take you through various areas that are there for all and one needs to critically assess and identify where one fits. Remember “Freedom”………………………

Let me start with an organization which will require a certain amount of funds or money or monetary resource of Finances to run itself. Are you able to relate it with freedom? I’m sure you all will be able to. Finance gives freedom for a smooth running. And we call this professionally something as “Corporate Finance”. Corporate finance is actually internal finance management, it’s an Inside-Out perspective. When the internal personnel works on finance for the organization.

Then comes the outsiders who are again looking for finance i.e. Freedom and we call it “Investment”, which the above organization requires to run and these outsiders require income or some other purpose. This simple term Investment brings into picture the whole structure of raising funds by an organization, assessing the financial viability of the organization (equity, valuation), complying with all the regulatory requirements, role of “Financial Markets” in making the whole process smooth with all the transparency and finally can be related to national and international levels. “Freedom” can be related to each and every point that I have mentioned above.                                                              

Corporate finance covers assessing the financial health of the organization for its day to day functioning as well as the ability to survive in the long run. It’s the outsiders who are interested in getting the correct valuation of the organization as they are the ones who will be going to infuse their funds in order to generate returns on their investments. For this purpose, certain professionals are required who do all these tasks of valuation and make projections as well on the running of the business by taking various assumptions based on internal, industry, economy and various other local and global factors. We call these professionals as Investment Bankers who further helps the organization in fund raising by handling all the compliance-related work as well. All this is carried out through a system that we call Financial Markets which in turn gets affected by numerous factors like political, industry-specific, geographical, and many more. And finally, the international terms come into picture like FDI, FPI, II, various international level institutions like the IMF which is again there to intimate the nations on their financial and growth perspectives.

I will now sum up this reading by asking you all for thinking about each area in depth and widen the knowledge base to identify your area of interest.

If any of you want to discuss this in detail, please write to me at singhal.shaifali1@gmail.com 

Thank You!!!! J