Pursuing Corporate Finance Professionally
Part of the Corporate Finance For Dummies Cheat Sheet
You've decided that a career in corporate finance is absolutely your life's calling, so what do you do next? You need to bone-up on some essential mathematical and computer skills that not everyone warns you about when you first begin your journey into corporate finance.
Whether you're pursuing your college degree or a professional certification, these skills tend to be sorely neglected, leaving many completely unprepared for the workplace. Going to college can give you the research and problem-solving skills you'll need, but it frequently doesn't give you the specific applied skills needed for the labor market. In addition to your education, supplement by getting some entry-level on-the-job experience, or doing an internship/apprenticeship under an experienced professional. You'll be glad you did!
Corporate finance uses, more than anything else, a lot of math. The majority of it is quite simple, but it's still math, so corporate finance is particularly ideal for those who are numerically inclined. Specifically, you need to excel at a few fields of math:
Arithmetic: You'll constantly use addition, subtraction, multiplication, and division.
Algebra: You need to be able to find X, because you'll need to do so quite frequently.
Statistics and Probability: Be certain you know this stuff — the math of uncertainty — if you want any hope of analyzing investments or risk. You won't see statistics and probability in entry-level jobs, but you'll definitely need these skills to get promoted.
Calculus: You'll see calculus less frequently than the other fields, but it's a crucial component to maximization and optimization equations, plus many forecasting analyses. In other words, you'll need calculus if you plan to become an analyst.
Even if you become the best mathematician in the world, unless you have some specific computer skills, you're still useless in the field of corporate finance. The reason is simply that the amount of data that must be recorded, processed, and communicated is absolutely massive. It's definitely possible to keep track of all this data with pen and paper, but it would take prohibitively huge amount of time. As a result, pretty much every finance job on the planet requires you to have a minimum of specific computer skills.
You should know how to use all of the following:
Any Internet browser
Any e-mail client
You also need to learn at least one software package of the following types:
Data analytics software (SPSS, SAS, and Microsoft Excel)
Accounting software (Quicken, Sage, and Peachtree)
Financial management software (JD Edwards, Hyperion, and Quantrix)
Database software (MySQL, Access, and Oracle)