Knowledge Base: Finance

“Finance” is a very broad term that refers to the study of money, currency, and capital assets (according to Wikipedia).

Within fields such as investment banking and private equity, “finance” usually refers to concepts such as the time value of money (money today is worth more than money tomorrow because you could invest it in and earn something by tomorrow), the present value of an asset, and the net present value.

These all concern what an asset or company that generates cash flows is worth, and what you might be willing to pay for it based on these future cash flows.

Other key finance concepts relate to a company’s capital structure (i.e., its mix of debt, equity, and other funding sources), its dividend policy (i.e., how much in after-tax profits it distributes to its shareholders), and its capital budgeting process.

We present below several tutorials on these and other “miscellaneous” concepts within finance: