Four Main Specialties of Finance
Finance is a large and often confusing term. It refers to several areas of financial activity that are concerned with managing and investing money. People who practice or have experience in the field of finance are called finance professionals. There are many careers in finance and all of them have something in common: they all deal with financing and making investments in order to make a profit.
Corporate Finance deals with the funding of companies. Corporate finance includes the funding of companies through a variety of financial activities such as borrowing, leasing, credit facilities, mergers and acquisitions, and other types of investments. The main goal of corporate finance is to provide growth and liquidity to a company. Some of the more common types of corporate finance include: private equity | venture capital | venture | businesses} Venture Capital is used to finance early-stage businesses. A venture capital firm buys a business at a price that is less than the value of the business. Later, the venture capital firm reuses some of its buying power to finance additional, more mature businesses. Many venture capital firms seek to fund start ups by using a combination of private equity and capital from banks and other investors. Many venture capitalists specialize in one or a few types of businesses.
Investment Banking In the investment banking industry, banks lend money, buy and sell financial assets, and perform mortgage loans. Banks are separated into two major categories: commercial and savings. Commercial banking aids larger corporations with larger transactions; while savings banks are smaller and focus on lending to individuals. Investing banks make loans more focused on individual needs rather than businesses as a whole. A few examples of investment banks are PNC Bank, Wachovia Bank, Chase Bank, and Wells Fargo.
Accounting Finance involves the collection, maintenance, allocation, and distribution of financial information that affects the value of a company’s stock market investments. Accountants create reports and financial statements that allow business owners to make decisions based on current and historical information. Accounting is divided into two main categories: Public Accounting and Private Reporting Securities.
bonds and Quotes The main function of bonds and quotes is to provide collateral for financial investments. They earn interest that is paid to the investor on a set date. The most well known financial institutions use long-term bonds and short-term quotes to provide long term financing and to spread risks associated with large financial investments. Examples of bonds and quotes are mortgage backed securities, corporate bonds, junk bonds, municipal bonds, and corporate note holders.