Finance Industry is the main branch of the money market that decides the various developments in the financial sector. A vital and fundamental understanding of the concepts of finance is key for businesses, big, medium and small.

It is money that makes the world go round. Anyone who understands this is a winner in life and in their chosen line of work. “Never spend your money before you have it,” said Thomas Jefferson. To quote the president-elect of the United States, Joe Biden, he says, “Don’t tell me what you value, show me your budget, and I’ll tell you what you value.

In short, one has to be aware of every penny or a rupee that one makes as someone wisely said, “A small leak can sink a big ship.” This is how the great financial minds think. And it is exactly with such wisdom that major businesses operate. And the same ethic can be emulated by small and medium businesses and individuals while making their investments.

“Knowledge is the key for financial success” says Entrepreneur and Thought Leader Hirav Shah.

A study of the finance industry that gives an individual the wherewithal to understand the workings of various industries and also how life functions in general. Understanding money like education is an on-going process and the better equipped one is in handling one’s finances, one can have greater control over life.

Financial freedom is a mental, emotional and educational process, says Robert Kiyosaki.

While financial freedom is a relative term, business analyst, strategist, corporate consultant and astro strategist Hirav Shah opines that taking care of your finances can be made easy if one knows what their financial future is likely to be. It helps in diverting funds, taking major decisions in business, investing at the right time for best results and withdrawing assets when the time is not right – these are just a few issues that Hirav Shah deals with in depth with his clients.

Today, let’s check out some key FAQs in the finance industry…

  1. What do you mean by finance to begin with?

Finance is a broad term that describes activities associated with banking, leverage or debt, credit, capital markets, money, and investments. Finance also encompasses the oversight, creation, and study of money, banking, credit, investments, assets, and liabilities that make up financial systems. So you can gauge how important study of finance can be.

Finance is a study which deals with how people and businesses and groups make and use money. It can include thinking about how to control money to make profit, studying how to take chances in projects that make money. As a verb, finance is to provide money for business or a venture.

  1. What are the three areas of finance?

Finance consists of three interrelated areas –
1) money and credit markets that deal with securities markets and financial institutions.
2) Investments that focus on the decisions made by both individual and institutional investors.
3) Financial management, which involves decisions made within the firm regarding the acquisition and use of funds.

  1. What is the purpose of finance?

The purpose of finance is to help people and businesses save, manage and raise money. It’s vital that the purpose of finance is clearly articulated and accepted.

  1. What are the basic principles of finance?

  • Principles of risk and return.

  • Time value of money.

  • Cash flow principle.

  • Profitability and liquidity.

  • Principles of diversity

  • Hedging principle.

  1. What are the four elements of financial management?

The major elements of financial management include
1) planning
2) controlling
3) organising and directing and
4) decision making.

  1. What are the rules of wealth building?

For starters, spend less than you earn, invest your surplus wisely (at least 10 percent of your income) and last but not the least, leave it alone so it can grow.

  1. What are the three areas of finance?

  • Corporate finance

  • Investments

  • Financial markets and institutions.

  1. What are the sources of finance?

Sources of finance for business are equity, debt, debentures, retained earnings, term loans, working capital loans, letter of credit, euro issue, venture funding, etc. These sources are based on time period, ownership and control and their source of generation.

  1. What are the principles of personal finance?

The list has been taken from the ten principles of personal finance by Arthur J Keown from his book Personal Finance, Turning Money into Wealth.

Knowledge is power.

Nothing happens without a plan.

The time value of money.

Risk vs Return.

Taxes matter.

Life happens – the importance of liquidity.

The power of budgeting.

  1. What are the principles of financial planning?


Financial success is measured by progression towards one’s goals and is as much a product of good habits, diversification, managing risks and staying the course by making successful investment selections. But the key for any financial success is discipline. The foundation for any successful financial plan is budget.

  1. Why is finance crucial for businesses?

Firms need finance to start up a business, for example, to pay for premises, new equipment and advertising. Run the business, for example, having enough cash to pay staff wages and suppliers on time. Expand the business, for example, having funds to pay for a new branch in a different city or country.

  1. What is the worth of the global finance industry?

Global bond markets outstanding value increased by 5.4% to $105.9 trillion while global equity market capitalisation increased by 23.8% year-to-year to $95.0 trillion in 2019.

  1. How much is India’s stock market worth?

India’s ranking has improved two, notches in the league table of the world’s biggest stock markets. Currently, India ranks seventh with a market cap of $2.1 trillion (2018).

  1. What are the best stocks to invest in, in 2021?



Price (Rs.)


United Drilling Tools



Gujarat State Petrone



Nestle India





“Finances are key to secure the future” concludes Business Strategist, Business Astrologer and Entrepreneur Hirav Shah.