Introduction To Finance

Jun 25 2014 Published by under General

As a brief introduction to finances, I will talk about different classifications of Finance within which I will touch topics more profoundly in coming articles. Finance bascicamente are known as:-personal finance. They involve obtaining credits and loans for the purchase of a House, car, etc., yields on investments for our future or our children, planning our retreat, etc., in order to live financially free. -Corporate finance. They are their own business.

We must be clear that the aim of our business is maximizing its value to make it profitable for us shareholders. How to do that? Minimizing costs, using our resources effectively to increase profits, knowing the best ways of financing and investment, and everything that has to do with the money of the company management. That’s finances corporate. A big company would more or less so (omitting other departments):-stock market finance. Will help us to get to know the financial products that are traded in the market of values, which we can use for some financing, obtaining liquidity (have the money on hand for immediate use), expansion, or even investment to obtain yields on interest, dividends (portion of the company’s profit distributed to shareholders), or (gain by buy cheap and sell expensive) capital gains. -Public finances. They are the finances of the State, which is responsible, through fiscal policy, obtain income of individuals and companies who pay taxes, and use that money (spending) for the prosperity of the country, encouraging saving, consumption, investment, the creation of employment, etc. Although do not touch us this Chamba for us as business people, is important to know the public finances since this macroeconomic environment affect our company or even our personal finances.

Therefore, if we understand how the Government is handling the country’s economy, we can anticipate, plan and make decisions to get out, or when less, not to see us affected. -International finance. Since every time we are more globalized, we can already enjoy financial instruments in other countries, to different currencies. Learn about international finance, will help us with the objective of our company, which as we have already said, is to maximize its value to make us profitable. Because in this way we, for example, obtain a credit in France, denominated in pounds sterling, or obtain a loan in United States, denominated in euros, to finance our company in the best possible way. This was a brief explanation of the objectives of the different areas in finance. I want you to know that We will cover all these issues to the extent that is possible.

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