Financial analytics is critical for any employer to live applicable withinside the aggressive marketplace with the proper techniques to examine and enhance the employer’s past, present, and destiny position. Financial analysts’ paintings with the subsequent analytics to examine the growth in organizations:

• Predictive sales analytics makes use of correlation and beyond traits to make precious predictions.

• Product profitability analytics determine person product profitability in preference to the enterprise as an entire to make certain precision and the proper profitability insights.

• Client profitability analytics analyses every customer institution to recognize which of them make contributions to the enterprise via way of means of bringing income and which fail to do so.

• Cash flow analytics is a massive part of monetary analytics, assessing the real-time coins waft of a commercial enterprise with the aid of using deploying real-time signs with equipment like regression analysis, dealing with contemporary coins management, and destiny waft.

• Shareholder fee analytics works with sales and earnings analytics to tally the returns it gives to the shareholders, making an investment within the agency and its fee.

• Value-pushed analytics determine the fee ‘levers or the important thing factor, positive to deliver worthwhile results. After comprehending their fee to cutting-edge and destiny goals, these key factors are intricately designed.

Significance of Financial Analytics

Just like a map made from the previous revel in and viable effects is higher to navigate unexplored territories, economic analytics courses the way to make economic selections in any enterprise. Businesses cannot virtually run-on intuition.

The financial analytics goal is to leverage credible insights via superior technical tools. With innovative start-ups taking areas withinside the market, surviving through the opposition is sort of impossible. The exceptional manner to live vigilant together along with your area withinside the marketplace is with the aid of using the usage of inherited data. Financial evaluation presents agencies the present of insightful statistics, narrating ancient developments and predicting destiny ones to preserve up with risky markets. Financial analytics alter the coins waft to guide enterprise desires at the same time as keeping its balance as opposed to restricting itself to an organization’s accounting, taxing, and making an investment domain. In addition, an economic analyst calls for each technical and commercial enterprise history skill.

A career in Financial Analytics

Financial analytics is one of the maximum sought-after, in-call for profession options. While it has no strict academic requirements, applicants have to have the essential qualifications to get commenced:

• Bachelor’s diploma in an applicable area is essential for buying commenced withinside the economic analytics domain. A main in finance, economics, statistics, accounting, or maybe engineering is essential.

• In addition to academic qualifications, problem-fixing talents, analytical thinking, communique talents, management process, and technical talents show precious additions to the role.

• Not mandatory, however, a master’s diploma in an associated area can enhance your possibilities of having hired. The diploma encourages newbies to discover their maximum crucial factors and search for applicable roles whilst searching out jobs.

• Try your hand at interning as an economic analyst for companies. A candidate with the revel in is extra precious than one with a hoard of degrees. Real-existence operating revel can simplify many things, even the ones now no longer taught in college. In addition, revel in facilitates enhancing your method toward topics and skillsets simultaneously.

• Additional certifications to enhance a resume can in no way cross wrong. Pursue licensed guides targeted in your region of specialization. Added credentials display your willingness to examine and discover.

Types of Financial Analytics

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Functions of Capital Market

While from a broader perspective, Capital Markets is considered as a marketplace of monetary belongings with long or endless maturity, it actually performs a totally critical function in mobilizing assets and allocating them to effective channels. So it is able to be stated that the technique of monetary boom of a rustic is facilitated through the Capital Markets. The critical capabilities and importance of the markets were mentioned below: –

1. Economic Growth: Capital Markets assist to accelerate the procedure of financial increase. It displays the overall condition of the economy. The capital Market enables withinside the right allocation of sources from the humans who’ve surplus capital to the folks that are in want of capital. So, we will say that it enables withinside the enlargement of enterprise and change of each public and personal sector-main to balanced financial increase withinside the country.
2. Promotes Saving Habits: After the improvement of Capital Markets, the taxation system, and the banking establishments offer centers and provisions to the buyers to store more. In the absence of Capital Markets, they could have invested in unproductive assets like land or gold or may have indulged in needless spending.
3. Stable and Systematic Security costs: Apart from the mobilization of funds, Capital Markets assist to stabilize the costs of stocks. Reduction in speculative sports and presenting capital to debtors at a decrease hobby price assist withinside the stabilization of the safety costs.
4. Availability of Funds: Investments are made in Capital Markets on a non-stop basis. Both the customers and dealers have interaction and change their capital and property thru an internet platform. Stock Exchanges like NSE and BSE offer the platform for this and accordingly the transactions withinside the capital marketplace grows to be easy.

Types of Capital Market:

The capital market is mainly categorized into:

• Primary Market: The primary marketplace specifically offers new securities which are issued withinside the inventory marketplace for the primary time. Thus it’s also referred to as the brand new trouble marketplace. The essential characteristic of the number one marketplace is to facilitate the switch of the newly issued shared from the organizations to the public. The essential buyers in this kind of marketplace are monetary institutions, banks, HNIs, etc.
• Secondary Market: It is the marketplace wherein the buying and selling of the securities without a doubt takes place, for that reason it’s also known as the inventory marketplace. Here the shopping for and promoting of securities take place, The present traders promote the securities and new traders with the aid of using the securities.

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With the support of ERP software and finance management system with functions such as accounting information system, asset management, and revenue recognition, financial management permits the company with a long-term insight. This business insight helps in vital decision-making on matters pertaining to investment, profitability, liquidity, and business expansion.

Financial managers are extremely insightful and skilled corporate finance experts who maintain the financial health of an organization. This is achieved by creating financial reports, planning and tracking investments, developing financial strategies, and designing short and long-term financial goals. 

Scope of Financial Management

For a sound fiscal implementation in a company or an organization, financial management plays a dynamic role. From strategizing the capital structure, capital budgeting, dividend structure, and scenario planning to vital decision making such as mergers, acquisitions, franchising, and business growth – financial management is the backbone that manages the fundamental resource, i.e., Capital.

Finance management also manages budget allocation to each department and principals the way for the entire organization to meet the short and long-term financial goals. 

Nature of Financial Management 

Financial Management demands main attention on wealth maximization, applying financial management values to manage the company’s financial resources or the organization. 

Financial Management has a centralized and comprehensive nature with administrator functions. It is the mainstay of commerce and industry as it basically includes a risk-return trade-off. Risk management is too one of the dynamic functions of financial management. 

The Nature of Financial Management can be explained as

1. Capital Requirement Estimation

Anticipating fund requirements can be one of the most vital features of financial management. Specialized finance managers estimate the capital requirement for a company or a project and prepare the budget considering all incomes and expenses. Correct cost estimates are vital for the survival and success of a project or a company.

2. Capital Structuring

Ideal capital structure needs vital decision-making about securities subdivisional proportion and combination of equity and debt. The correct balance among debt securities, equity securities, derivative, and hybrid securities reduces the cost of capital.

3. Funding Source Selection

When it comes to selecting the source of funds, financial management again plays a dynamic role in defining the suitable sources, including owner investment, issuing of shares, bonds and debentures, venture capital, retained income, etc. The principle behind selecting the funding source mostly sticks to capital cost reduction, low-risk involvement, and convenience.

4. Raising Shareholder Value

To increase the overall value of shareholders, financial management works on cost reduction and profit maximization to rise return on investment to shareholders. Finance management focuses on not only fundraising but also fund investments on behalf of the company they work for, not only for the company’s profits but also for the shareholders who have devoted in their company.

5. Cash Management

The complete cash inflows and outflows are tracked, monitored, and managed by financial management. This balances the cash surplus and deficit for the profit and financial security of an organization. Cost overrun is one of the primary reasons of project failure, and financial management efficiently maintains sufficient cash flow and reduces liabilities to meet the short and long-term financial goals and responsibilities.

Scope of Financial Management

To know the scope of financial management, these below-mentioned factors are the vital decisions taken by the financial management. It is valid in finance and non-finance institutes, stock markets, ministries, corporate houses, etc.  

1. Investment Decisions

Financial managers are responsible for selecting the correct set of investments for an organization. Short-term investment decisions are linked to fund provision in current assets in the short run. Investment decisions in the long-term are investment proposal selection based on many financial factors and is often referred to as Capital Budgeting.

2. Financing Decisions

Another vital decision that comes under the possibility of Financial Management is the financing decision. Finance management is accountable for raising the capital for the company. Correct from designing the company’s capital structure and selecting the funding source to accomplish the process, the financial manager takes the company’s financing decisions. 

3. Liquidity Decisions

When it comes to productivity and access to capital, financial management confirms that the company’s assets and securities continue liquid, i.e., available to the management as and when required. Finance managers confirm effective management of current asset investment and protect the company against illiquidity risks. 

4. Dividend Decisions

The financial manager chooses the profit distribution policy for the company. Whether the company selects to distribute the revenue among shareholders in the form of dividends or focuses on profit retention, financial management plays a pivotal decision-making role. 

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1.  Industrial Employment (Standing Orders) Act 1946  – it requires things like work hours, dismissal process etc approved by govt. authority.
   
2.  Contract Labour (Regulation and Abolition) Act 1970 – It regulates employment terms of contract labour and ensures that they get the minimum dues.
   

Wage Regulation –

1. Payment of Wages Act 1936 – it states wages to be paid in money and not in kind among other provisions.
   
2.  Minimum Wages Act of 1948 – it has ensured minimum wages across various jobs across the state and central govt ranging from 130 INR to 1130 INR per day.
   
3. Payment of Gratuity Act 1972  – it mandates that at the time of retirement the company pays 15 days salary per year capped at 20 lakhs INR. Applies to an organisation with 10 or more workers.
   
4. Payment of Bonus Act 1965 – Minimum bonus is 8.33 % of salary. Applies to organisations with more than 20 employees.
   
5. Weekly Holidays Act 1942
   
6. Beedi and Cigar Workers Act 1967 
   
7.  Equal Remuneration Act of 1976 – It prescribes equal pay for Males and Females.
   

Health & Safety –

1. Workmen’s Compensation Act of 1923 – it mandates payments to bear medical expenses in case of injuries at the workplace.
   
2. Factories Act 1948 – safety laws to be observed in factories.
   
3. The Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013
   
4. Child Labour (Prohibition and Abolition) Act 1986 – mandates the legal age for children at work – it is above 14 years of age in India.

Pensions and insurance-

1.  Employees’ Provident Fund and Miscellaneous Provisions Act 1952 – it takes approx 12 % of basic salary from the employer and the employee and puts in the EPF fund where an interest rate of 8.65 % approx is provided by the Govt.body.
   
2.  Employees’ State Insurance Act 1948. – It provides medical facility to employees of any org with a salary less than 21000 inr having more than 10 employees at a monthly premium of 1.75% of gross salary from the employee and 4.75% from the employer.
   
3.  Maternity Benefit Act 1961- It deals with granting maternity leave to female employees for a certain period of time.

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The following lists the types of or ways of getting a working capital loan in India –

1. Trade creditor – suppliers usually provide these type of loans by offering supplies at credit, at a premium if the case be.
2. Bank overdraft facility – Banks provide more money than already in the acc based on the credit rating of the acc holder.
3. Account receivable loan – this loan is obtained against confirmed sales order values of a business, based on credit rating of the applicant.
4. Factoring or advances – this is against some periodic payment that has been confirmed and will be received by the business.
5. Short term loans – usually for 6 to 12 months based on credit rating and relationship with the lender without requiring any collateral.
6. Equity funding – funding or investment that somebody puts in in return for interest or some other form of return. This loan is applicable when the credit history of the borrower is not good or below average.

Advantages of Working capital loan –

1. No collateral required.
2. Speed and flexibility
3. Funds at the discretion of the borrower

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2. With an increasing number of platforms like Freecharge etc facilitating mutual fund and other investments like stock trading, online trading will see a big jump in 2020.

3. Cryptocurrency monitoring and other online currencies that will start functioning need to be regulated – all these will require online setup and execution- Fintech will facilitate all these.

4. Mergers and acquisitions require a lot of financial tasks to be executed and coming 2020, with the Indian Govt bringing together Public Sector Banks being just one austerity measures among so many sell-offs and buy-ins /outs, Fintech has a serious role to play in these in order to improve execution and cut losses and expenses.

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1. The threat of new potential entrants
   
2. The threat of substitute product/services
   
3. Bargaining power of suppliers
   
4. Bargaining power of buyers
   
5. Rivalry among current competitors

Let us delve into each of these factors in detail –

1. The extent to which market entrants’ success is restricted by can be grouped as –
   a. Economies of scale
   b. Brand loyalty
   c. Government Regulation
   d. Customer Switching Costs
   e. Absolute Cost Advantage
   f. Ease in distribution
   g. Strong Capital base
   
2. Competition for market share among already placed companies depends on –
   a. Extent of exit barriers
   b. Amount of fixed cost
   c. Competitive structure of industry
   d. Presence of global customers
   e. Absence of switching costs
   f. Growth Rate of industry
   g. Demand conditions
   
3. Buyers often become powerful as they hold full knowledge of the market, they have options and a lot of other factors come into play that can lead to a company losing sales/market share.
   
4. Suppliers often tend to regulate the production or quality provided they have other business willing to purchase their product/services by say for example highering or lowering costs (if they enter into a diff more profitable agreement with some other competition) and providing discounts to specific buyers.
   
5. Substitute products pose an immense threat to existing products. They can put a hold on the sale of a certain product/service. Maruti Suzuki 800 and TATA Sumo is responsible for the loss of Ambassador’s market share thereby reducing it to zero.

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The period of study is of 24 months – Key highlights –

1. Website organic traffic increased by 1400 % to 15000 visitors per month from a mere 200 hits per month.
2. Revenue from organic growth is estimated to be around 14 M USD.

So how was this achieved? Even now it is on the increase.

West Roofing Company, based out of Cleveland Ohio, in its 40th anniversary, decided to expand further by doing something new.
They partnered with IMPACT to this end.

The strategy adopted by IMPACT & West Roofing Company to get more business-

1. The approach of assignment selling – Each of its salespeople was given the task of reading the educational content from the company that addresses 80% of the queries by the customers/ potential customers before going for a conversation or sales speech.
2. West Roofing Company hired a professional videographer as a full-time employee to create videos regarding their works and post on YouTube.

The Result –

1. Pageviews increased by 820% to23000 in 2017 from 2014.
2. The organic lead generation led to revenue of 14M USD from 14 projects that were possible only because of leads from the website and YouTube traffic.
3. The number of sessions increased from 212 to 11347 in 2017 from 2014.

The post Case 1- How a commercial roofing company increased business? appeared first on Smart Edge.

The Significance

In big or small measures central banks have tried something remotely similar to QE – whenever the CBs decided to pump liquidity into the economy, they have cut the lending rates so that it becomes easier for the borrowers.

However, in the wake of the crisis of 2008, the central banks’ such measures failed even after bringing down the interest rate to zero (liquidity trap) and then they resorted to QE.

The Methodology

The basic principle of QE is that the FED never buys bonds from the market using already extant money, rather at first, it creates money and then purchases bonds, assets etc -in this way it has pumped in new money into the economy thereby boosting economic activity.

Asset Purchase Program

QE involves buying assets from the economy against newly created money by the FED.

As a matter of fact, before 2008 the FED has pumped 880 million USD and by 2015 the figure stood at 4+ million USD. This was done through various purchases.

Fractional Reserve Banking

The FED has been issuing dollars into the American Economy against assets in essence. This liquidity has propelled circulation of more dollars through economic activity yielding returns that were added to the economy.

Quantum of the Issue

The Feds basically bought bonds from any bank that offered them the least rate of purchase.

Ramification

Since every economy is connected to the American Economy is some way, so even now any changes in QE by the FED has huge implications all over the world.

#Helicopter Money – One process wherein the central bank literally prints money and uses that to buy bonds and assets thereby injecting liquidity into the economy.

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There are 2 types of portfolios that are practised –

1. Market Portfolio – Is the weighted average return of all the investment profiles/areas available. It is a theoretical tool that gives results with different proportions of investment through different ‘tools’.

2. Zero Investment portfolio – In this case, the total sum of INR from the portfolio is always kept at zero. For example one sells share worth 1000 INR and uses the sale proceeds to purchase shares of some other company. Thus the money with the investor is zero. One important fact is a ZIF has no weight as the weight cannot be calculated. This is because weight is given by – the value from the portfolio divided by the INR from the portfolio and since the denominator is always zero- the equation cannot be defined.

Types of portfolio management –

1. Active -involves continuous buying and selling of securities to ensure maximum return.

2. Passive -Fixed portfolio designed to meet the current market.

3. Discretionary – the manager trades over the portfolio to yield returns for the client/ customer.

4. Non-discretionary- the manager is restricted to only an advisory role.

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