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Finance is a term for matters regarding the creation, management and study of money and investments. Savers and investors have money available which could earn interest or dividends if put to productive use. Individuals, companies and governments must obtain money from some external source, such as loans or credit, when they lack sufficient funds to operate. Finance is the process of channeling money from savers and investors to entities that need them. Specifically, it deals with how and why an individual, company or government acquires the money needed – called capital in the company context – and how they spend or invest that money.Finance has also been defined as the study of how to determine the value of assets such as stocks, bonds, loans, commodities, and by extension entire companies. Accurately determining value is crucial to sound business decisions. In some cases, such as one company acquiring another or entering a new line of business, judgements about asset values can make or break the investor. Finance encompasses: the operations of financial markets and the financial services sector, which enable the flow of money within the economy via banking, investments and other financial instruments; investment management, securities trading and stock brokerage; investment banking; financial engineering; and risk management.It is often split into the following major categories: corporate finance, personal finance and public finance. Given its wide scope, finance is studied in several academic disciplines, and there are several related professional qualifications that lead to the field.
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