In order to better understand the term ‘finance’, it is very useful to understand it with two related activities that are intimately connected to the term. One is the exact method to acquire the needed money. The second is the knowledge of the ways through which, funds can be managed. In a more comprehensive definition: it is a branch of economics dealing with the system and study of financial instruments, and financial activities such as borrowing, lending, paying, and so on.
Giving examples of activities that finance includes is the easiest way of describing the term finance. The allocation of assets & liabilities are elements that are concerned with finance and those assets are not free from risks. The outcome can be seen over time and space. You have to go through uncertainty and risk. It is important to understand the process of finance, which is all about learning how to deal with or handle different ways that are tried and tested ones by expert economists and business owners.
Under this process, a student of finance has to understand the way groups, companies, economist and other groups active in money management. It is not all about managing money but it is also connected with money making. So, finance is a subject to teach you how to make money through money including making a loss, making a profit and making money. Managing money efficiently can only prove to be something that can help you make money.
Managing money randomly without planning is like playing gambling leading to either win or loss. In business, you are not supposed to take such a big risk because you have the means to go ahead with your own platform. So, better be safe than sorry! Managing money efficiently is the key definition of ‘finance’ at its most basic level. Hopefully, you like it!