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07 Feb 2022

Why is it important to study International Finance?

Why is it important to study International Finance?


The world of business is at a full-throttle expansion mode as we speak.

As countries around the world come together to foster greater bonding through strong trade and commerce, understanding the nitty-gritty and modalities of international business has become imperative. In the dynamic world of business, there is a growing need for students and professionals to have a grasp on all the aspects related to international business.

International Finance is a segment of International Business, multidisciplinary as it deals with trade, commerce, and cash flow.

What is International Finance?

International finance is defined as a branch of financial economics, dealing with the macro-economic relations between two or more countries and their trade and transactions.

Importance of taking up International Finance

For students and working professionals who wish to understand the global business dynamics, an International Finance degree is very useful. It provides a good idea of how things work across borders and different economies

Scope of International Finance course

A degree in International Finance covers topics related to business transactions between companies across nations. It helps students understand the following aspects of international business:

Foreign Exchange Rates –

In simple terms, foreign exchange is the price of one currency expressed in terms of the units of another currency. Understanding the concept of Foreign Exchange is the first step towards doing any sort of cross-border or international business. This, in turn, helps businesses take important trade or business decisions.

For example, if we know that the Dollar Vs Rupee trading is high, (where the US dollar has more value) then we know that exports can be increased to gain on the dollar movement. The case is just the reverse when the Rupee value goes higher – then, imports can be increased.

Inflation Rates –

Inflation rates help understand the value of goods and services in different countries and economies. Businesses understand the export and import potential concerning a particular economy by observing and studying inflation rates. Businesses can also time their exports and imports based on inflation rates, taking advantage of the existing conditions.

Global Economic Conditions –

International Finance covers major aspects of global economies and their prevailing conditions. It also allows to study, analyse and ascertain the economic conditions of various countries which in turn provide relevant perspectives on the dynamics of each economy.

Great businesses always emphasize a deep understanding of the economic conditions across the world. If a business has to make use of international opportunities, it has to have a good idea of the current economic conditions and their impact shortly.

For students taking up International Finance, it helps gain a lot of knowledge, perspective, and analytical thought process through the deep study and understanding of economic conditions across borders.

Investment in Foreign Markets –

Another area covered by International Finance is Investment in Foreign Markets. The why, how, and when of investing in foreign markets— be it in terms of equities (shares and stocks) or direct investment into businesses (FDI – Foreign Direct Investment) — is dealt with in the study of international finance. Global companies and investment firms study economic, market, and political conditions in foreign markets before taking a call on investments. For example, it is usually not the right time to invest in a country or its businesses, if the news of economic instability or abrupt policy changes is around the corner, which could be unfavourable to the business.

Eco-political landscape –

This is of utmost importance because political conditions have a direct and huge impact on the economy of a nation. The extent of political stability in a country, among other important factors, will determine its economic progress. The more stable the political environment, the steadier the policies and the business setup will be. This, in turn, results in a more conducive and progressive business environment, making it easier for foreign investors and companies to play a key role in the economic collaboration and development of the host nation.

How a degree in International Business can help in your career?

A degree in International business will present you with unique career opportunities in the sense that it allows you to travel and or connect with different people around the world while at the same time play a key role in helping organizations in their various functional departments.

The following are some ways, a degree in International Business can help –

Equip with Skills:

International Business (and International Finance) degree equips students with relevant skills to be able to handle different roles across various departments within an organization. The degree helps to understand various skills and knowledge in the areas of – International Trade, International Investments, Exports and Imports, Foreign Exchange, International Monetary movement, Emerging Markets, and Economies to name a few. A grasp on the aforementioned subjects will open up doors to a good number of career opportunities in both domestic and international companies.

Abundant Job Opportunities:

With economies across the world expanding, many corporations have set up their bases in different countries. These corporations require people well-versed in the area of International Business to help with various roles that continue to emerge and evolve based on business needs.

Apple, IBM, Google, Facebook, Pepsi, Coca-Cola, Unilever are some of these multinational organizations which hire people with experience in International Business.

Good job opportunities are also available within India with companies such as Goldman Sachs, JP Morgan, Credit Suisse with various roles such as trade analysts, business analysts, and financial consultants, etc.

Some of the job roles available through a degree in International Business are – Financial Analyst, Trade Analyst, Business Analyst, Investment Banker, Management Consultant, etc.

International Exposure:

One of the most cherished aspects of a degree in International Business is that it allows for international exposure or exposure to international business environments. Sometimes, professionals get to travel the world on business and meet with clients and customers from overseas and connect with them. This sort of exposure and experience not only adds great value in career terms but also provides the unique opportunity to get to know and assess the business environments of other countries.

Professionals with international business exposure are presented with great many career opportunities and stand a chance to speed up their professional growth.

Salary and Perks:

A good job in one of the many multinational corporations pays good salaries not to mention the various perks and benefits associated with the profile. If you are traveling countries, all your travel, stay and food expenses are usually taken care of by the company. The roles of Investment Banker, Management Consultant, and International Trade Analyst are some of the highest-paid jobs.

As a student, if you are aspiring to understand the global business dynamics and have strong fundamentals in the area of finance and business, a course in International Finance and or International Business is a must. International Finance is not just about understanding the financial aspects of international business, but it goes beyond to provide an analytical view of the global trade and markets.

Online Degree Programs is the perfect opportunity for working professionals who want to upgrade their skills in International Finance or transition to this challenging domain.

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