Simply stated, there are two main functions in the financial world: buying and selling. businesses require funding, therefore, they either sell equity shares in their companies (stocks), or fixed-interest-payments securities (bonds). The investment community values these securities and buys and sells them.
The theoretical basis for financial analysis is the risk/reward equation, in which higher risks are associated with higher returns. Returns are calculated by determining the amount and the timing of cash flows.
the guiding principle of financial management is to maximize the firm's value by financing cash needs at the least cost possible, at a level of risk that management can live with.
Finance and Accounting are different. Finance -strategy decision. Accounting- Information. trends facts.topic in finance:(1) External- Investment: Valuation and Cash flow.(2) Internal-Financial Management:Dividend and Merger and acquisition.
Tuesday, May 11, 2010
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