What is finance?
Finance is a broad and complicated subject, made up of complicated mechanisms and skills but accessible if you have the willingness to learn and dedicate the right amount of time and sweat. Nothing is simple in this field, but understanding what goes on behind the scenes is basic to having a good method of investment and economic growth. It is time to understand the words and numbers given by the news on TV.
Finance is the economic discipline that study process and choices for investing. Investing is the financial activity that any individual who wish to increase his capital does, with the aim of increasing any monetary resources or to acquire other resources of different kinds.
Otherwise, financing is a transfer of money for economic activity that will lead to the repayment of the sum even increased.
Financial studies are concerned with the technical aspect of these processes, that is, the creation of prices, assett valuations and everything related to the strategies adopted to hedge risk, in technical terms defined hedging
When we talk about valuations we are referring to economic-financial analysis and planning to determine the feasibility and return on various investments by a person working in the market.
When we speak generically of finance, we immediately associate financial instruments, that is, products and instruments with which money exchanges take place between individuals, states and businesses, in places that are called financial markets.
These places, which were once physical like Wall Street in New York but now become mostly digital, have precise rules and authorized operators. There are regulators regarding compliance with market rules and there are companies that organize the market in this regulatory scheme that varies from state to state. In fact, these rules allow for the creation or not of different financial instruments.
These different financial instruments create different financial markets. If we talk about debt, we will have the bond market. If we talk about stocks we will have the stock market, if we talk about the currency market we will have forex, and so on down to commodities.
Always remember that being a market, we will have a seller and a buyer, in this case a large number of both. In between them are the financial brokers.
Every crypto exchange is a financial market.