Another business decision concerning finance

Another business decision concerning finance is investment, or fund management. An investment is an acquisition of an asset in the hopes that it will maintain or increase its value. In investment management - in choosing a portfolio - one has to decide what, how much and when to invest. In doing so, one needs to

• Identify relevant objectives and constraints: institution or individual - goals - time horizon - risk aversion - tax considerations
• Identify the appropriate strategy: active vs passive - hedging strategy
• Measure the portfolio performance Financial management is duplicate with the financial function of the Accounting profession. However, Financial Accounting is more concerned with the reporting of historical financial information, while the financial decision is directed toward the future of the firm.