How Does Corporate Finance Differ From Investment Banking

Corporate Finance and Investment Banking, both form very essential divisions of any firm, dealing in the field of Finance. According to Investopedia, the most basic difference between these two is, that Corporate Finance deals with the management of a company’s finances, whereas Investment Banking deals with the financial growth of the company. Regardless of their differences, it has been seen that these two fields make for great, promising careers for finance aspirants. A professional working in either of these fields, has to deal with similar kind of challenges and prospects. Corporate Finance, is like a blanket term, used to refer to all things finance, including every vertical that deals with financial activities. In a very broad sense, Investment Banking can also be called a type of corporate finance, which makes their differentiation slightly difficult. While corporate finance can be used more like a general term, Investment Banking is a more of a niche concept.

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The field of corporate finance, is concerned with all the day-to-day financial activities of a firm. The main objectives herein are, to take decisions regarding investments, raising capital, maximizing the value of the company, distributing the resources throughout, issuing of securities, analyzing and identifying areas, where it would be necessary to raise capital. Investment Banking, by and large deals with the process of making a firm grow. This is done mainly through, the process of mergers and acquisitions, issuing of securities and various other functions, through which the capital can be raised. Investment Bankers are the professionals, who carry out these activities for a firm and are hired for their specialized knowledge and approach. Investment Bankers are known for their abilities to steer a company out of financial turmoil on to calm waters, this why in spite of being a sub-field, Investment Banking is still considered to be a separate field.

The education requirement for Corporate Finance is a background in either economics, business, or any other finance related field. A degree in accounting makes for a lot in this field due to the nature of the job. As this field covers a lot of job profiles, the skills required here are, good analytical abilities, thorough knowledge about corporate theory, financial analysis, strong communications skills and familiarity with other related concepts of finance. Investment Banking requires a more specific set of skills, but a base in finance, investments and other areas is expected. A lot of Investment Bankers complete their MBA degrees and a few other certification courses, which gives them expert knowledge about the field of Investments. Lately a lot of companies have begun looking for candidates with exceptional resumes, which is the reason for the increasing number of people doing certification courses.

There are eminent institutes like, Imarticus Learning, which offer certification programs specializing in both of these field. Their courses are available both in the classroom as well as online format and can be done by professionals who already have a job. While both of these fields are equally challenging and rewarding, Investment Banking has become a front-runner choice for a career in finance; while on the other hand, Corporate Finance offers a variety in terms of career roles. Differences apart, both the fields have great perks and opportunities to offer.