This is the transcript for the video Finance Major
Dr Scott Walker 0:00
Good afternoon, everyone. Thanks for joining us at the UTS Open Day 2021. My name is Scott Walker, as you can see from the title slide, and I’m in the Finance Discipline Group. So what I’ll be talking to you today about the Finance majors specifically. First of all, it is very important that we make an Acknowledgement of Country. So I would like to acknowledge the Gadigal people of the Eora nation, upon whose ancestral lands our campus now stands. I would also like to pay my respects to the Elders both past, present and emerging and acknowledging them as the traditional custodians of knowledge for this land.
So, really, I guess you’re here because you want to know, what is Finance? Well, because I’m going to explain to you about the Finance major, you want to know what Finance is, and really what finance is, it’s all about managing money. A good example of this that many of you may be familiar with, is the issue with Lionel Messi, the football player who had to leave Barcelona, which is where it basically started his football career when he was 14 or 15. Why did Messi have to leave Barcelona? Because the club had financial difficulties. So what was happening was that basically Barcelona could not afford him. Because the revenues that the club was earning have been decimated because of the pandemic. So like any business, once their costs get to be larger than the income, then of course, you’ve got a what’s called cash flow problem. And finance is all about cash flow. And if a company has cashflow difficulties, or even a football club like Barcelona, then of course they can’t, they’ve got to manage those costs. And so of course, they had to let Messi go to ensure the long term survival of the club. Now, of course, to ensure the long term survival of the club that had to deal with that cashflow problem, and they did that by involving an investment bank. And this is a huge part of what finance is about, which is about getting some capital or money. So Barcelona needed some capital, they got the help of Goldman Sachs, to help borrow some money. And that will hopefully see Barcelona through the next probably eighteen or two years and they’ll come out stronger on the other side. So really finance is; this is just one small example of what finance is all about just taking the case of a famous example, with Barcelona. And so we can talk about it more broadly. But in essence, it’s about managing that money, managing that cash flow, to ensure a company’s long term success.
Of course, there are some incredibly successful companies in this world and in finance, we measure success by value, more specifically, stock market value. So for instance, we know out of these companies I’ve got listed here, well, we know that the most valuable company in the world is Apple, obviously, being an online event, I don’t have that interaction with you. It’s much more fun when we’re face to face on the beautiful UTS campus, which you can see my background is Building 8, which is where I’m based, and many of your classes would also be held. And I would be telling you, asking you questions, you’d be sitting comfortably with free food and drinks at the campus on the if the Open Day was on campus. And I’d been asking you questions, and you’d be answering them and I’d be giving away free, free food, etc. Obviously, we lose that interactivity, which is fine.
So for instance, we know Apple is the most valuable company in the world, it’s worth more than $2 trillion (and that’s measured in US dollars). In Finance we’ll talk about okay, look, why is a company like Apple been so successful? How do they achieve that success and why they’ve been so rewarding for their shareholders who are the owners of the company. And everyone’s always thinking of what’s going to be the next Apple? Well, again, I can’t tell you because either, in fact, I can’t give you a recommendation because I don’t have an Australian Financial Services license. So I’m not licensed to give investment advice. But of course, a large part of finance is trying to identify what makes a company successful. Everyone’s always on the lookout for the next Apple. I mean Apple, for instance, is listed on the stock market, which of the stock markets is Apple listed on? Well it’s definitely not the ASX; it is the NASDAQ. And Uber is another fairly successful company. Again, people are wondering, well is Uber going to be the next Apple? Is their price going to keep rising? I mean, Uber is on the New York Stock Exchange. So that’s the Stock Exchange. NASDAQ is another US stock exchange. In Australia, we’ve mainly got the Australian Securities Exchange, which is where CSL and Airtasker, are listed, just two Australian companies I’ve picked. Obviously, CSL is in the news at the moment is in manufacturing vaccines.
So a lot of finance is all about what’s the role of finance in a company, whether it’s a public company on a stock market like this, or whether it’s the Barcelona Football Club, or even whether it’s a government or government entity, they all need to manage their finances. And that’s a large part of what a Finance major is all about. Obviously, UTS is not a stock market, that’s just the UTS logo.
So why come to us to study Finance or remember that we don’t have a Bachelor of Finance degree? Sure, there’s a Bachelor of Economics, Bachelor of Accounting, etc. But the Finance major is part of the Bachelor of Business. So if you choose a Finance major, you’ll be taught by a team of people in the Finance group. And we’re world recognized for our teaching, sorry, for our research areas, in particular things like ethics and sustainability, we’ve got a strong team, doing research in that area, but we’ve got a very strong team and well known people in the area of research in the banking industry, also corporate finance; so what are the finance decisions made by companies, both whether they are companies on the stock market or private companies. And also market microstructure, which is looking at the liquidity and how easy it is to buy and sell stocks in a stock market. Also got part of market microstructure, we’ve also got a very well regarded team of people looking at cryptocurrencies as well. And we’ve been successful very recently with one of our professors looking into digital finance and that’s a big part of what our department does as well. We’ve also got very strong industry connections, and a lot of your classes in finance, we will bring in finance practitioners to talk about how certain financial activities are conducted in industry. So we’ve got a really strong link with a number of organizations, such as these listed here, and we’ll often bring in guest speakers from these industries, just to show you potentially what kind of a career you’d be doing and the finance activities how it relates to what you’re studying. Again, because of our location, is very useful as well being so close to the city. And we’re close to a lot of entrepreneurial hubs and innovation hubs, as well.
So again, as I said before, the Finance major is one of the majors that we offer as part of the Bachelor of Business. So remember the basic structure of the Bachelor of Business, there’s the first year, which is a group of eight core subjects that everyone must do in the Bachelor of Business. And once you’ve had a taste of those eight subjects at the end of the first year, you’ll then decide on what majors you want to choose. Now, hopefully, one of those will be the Finance major. So in the first year, there’s one in the first year of eight core subjects there’s one finance subject, there’s a couple of accounting subjects, there’s one or two management and marketing subjects. The one finance subject that everyone must do is called Fundamentals of Business Finance, that’s a first year subject, and that’s one that I teach along with a colleague of mine as well. In that subject, we show you the basic building blocks of finance, and hopefully based on that subject, you’ll have a good taste, and you’ll start to enjoy finance and you’ll choose Finance as a major.
The Finance major; the structure is there’s five core subjects. So the first four of these subjects you would do in second year, so remember, in first year, everyone does the same. everyone comes into the Bachelor of Business doing the same eight subjects. They’re the core subjects in the Bachelor of Business. Then, if you do a Finance major, then there’s four subjects you’ll do in second year, and then maybe you might do another major. So The Financial System is talking about the financial markets, the participants in the financial markets, financial metrics for decision making. You’ll use financial data and analyze that data to make good financial decisions. Investment Analysis, you’ll look at analyzing particular stocks, and then putting those stocks together in, for instance, a portfolio of shares. And that’s the principle known as diversification. You do a bit more detail in Corporate Finance, which is again, looking at the finance decision within a company. Generally, all those decisions are made to increase the value of the company for the shareholders. And then the fifth core subject in the Finance major is a Capstone subject where you bring all of your knowledge together in one subject, right at the end of your Finance major. And then of course, there’s three electives as well. So based on those subjects you’ve done here, you might get a flavor for, let’s say, Commercial Bank Management, because you’ve done a little bit of banking in The Financial System. And you might choose to do that as one of your three electives. Maybe you might want to do a little bit more in Derivative Securities, which is looking at security, such as options or futures. So the five core subjects based on that, you then might choose one of these other three subjects to pursue. And again, you pick three, so all up is eight subjects in the Finance major. And again, the Finance major is one of the majors that you can choose as part of the Bachelor of Business. I really enjoy teaching it. I love the subject, particularly a first year subject where I get to really try to inspire you about finance and really generate an interest and show you why I love it so much and hopefully some of that enthusiasm will rub off on you.
There’s lots and lots of career paths in Finance; here’s just an example of where some of our recent graduates have ended up at. But again, the best way to get a feel of what finance is all about is have a look at for instance seek.com.au, open up seek.com type in finance. And I just did it this morning. For instance, I saw there was a role for a Finance Trainee at Dreamworld. And one of the things that a Finance Trainee at Dreamworld would be doing would be analyzing the success of what’s known as capital expenditure. So if Dreamworld perhaps builds a new ride, your job would be to analyze if that new ride is financially viable. And that’s just one of the many many roles that are available in finance, just go to seek.com.au, you can have a look at that. There are other roles at Bundaberg Sugar. And even on that very first page, which you can look up yourself there was a financial analyst role at Alinta Energy. So there’s a lot of different career paths for finance, it really depends on what interests you. But particularly once you’ve found something that interests you, then you’ll be much more enthusiastic.
And that is that is my top tip. Find something that interests you. Now we work really hard to make finance relevant and give it real world applicability. And hopefully that way you can see exactly what you’re learning in the classroom is what a finance person would be doing as a career. So enjoy, embrace that embrace this subject. One thing I should make clear is that Finance, this is not a mathematical finance degree. It’s finance as part of a business degree. So the finance, we teach you; sure there’s numbers, but it’s not mathematical finance. It’s much more applied finance. It’s very popular that people who enjoy their numbers to combine finance, with accounting, that is the most popular double major combination that people do as part of the Bachelor of Business. There are some overlaps between finance and accounting, but they are quite definitely separate fields.
If you do want more information, there is the Business Undergraduate Course Guide for 2022. And you can obtain it from that web site (uts.edu.au/business-undergraduate-course-guide). Again, if you’ve got any questions put them into the chat, we can answer them here. Also, don’t forget the general business UTS address one there business@uts.edu.au – there’ll be people there who’ll be able to answer your questions. So that’s it from me. Hopefully giving you a flavor for what the Finance major is all about, again, there’s not a Bachelor of Finance degree. Remember the Finance major is one of the majors that you can pursue as part of the Bachelor of Business. So thank you for your time it’s a shame I can’t see you in person and answer your questions face to face, but pop them into the chat and I’m happy to spend a bit of time now to answer any of your questions. So thank you for listening to me. Now it’s my turn to listen to you.
John Kennedy 15:22
Thanks Scott, I’ve been monitoring the questions, I just thought I’d read them out to you, and you can respond to them live. And so we’ve had a few questions today the first one? Would I choose finance as a major if I’m interested in share trading in the future?
Dr Scott Walker 15:38
Oh, definitely, yeah, because potentially if you’re interested in share trading, you would like to know the skills that will enable you to work out if you should buy a particular share. And again, we do that one of the subjects we do which is the Capstone, which is looking at models of share valuation, and valuing shares, and other assets, like bonds, that is a common theme throughout the entire finance major, so definitely yeah.
John Kennedy 16:11
And then does UTS help open doorways, to be able to help and assist in finding a job while doing a business degree?
Dr Scott Walker 16:19
Well, one of the one of the subjects you can do, I didn’t mention it. But one of the subjects you can do as part of the Finance major is even an Internship. We will give you some help finding a company that you could do your Internship at. But essentially, many of the students as they get through, as they progress through the degree will meet for instance, guest speakers, and they might even have a word to the guest speaker and say, I’m interested in a role of an internship at your organization. Is that a possibility? So there is the internship subject, but also UTS has got a Career Service, where they will give you a lot of skills in preparing for post; preparing for employment after you graduate. So yeah, there’s lots of support we will give you.
John Kennedy 17:09
Yeah, and that Career Service as you’ve just said helps support in many ways. They run many events throughout the year, so you can engage with industry, and there are career evenings as well. And you can access them as much as you want. And, and if I was going to offer a top tip, that’d be something I would say is, you know, don’t be afraid to keep going back to Careers, you know, your ideas may change, and what you want to do may change, and they can help guide you on how you might kind of navigate what you’re thinking in for the future.
Dr Scott Walker 17:36
Yeah, definitely.
John Kennedy 17:38
Could you elaborate on finance being referred to as Applied Finance?
Dr Scott Walker 17:42
Oh, okay. It’s not, it’s not theoretical finance. So when I say applied, a lot of the work you’ll be doing is conceptual, and explaining certain financial activities. Sure, there is some underlying for instance calculations that you’ll be doing. But a lot of it is being able to put that; put your financial analysis into words and explain to someone why you should choose a particular course of action, whether it’s buying a share, whether it’s; if Dreamworld should build a new ride, ultimately, what underlies a lot of the decisions that companies make is what’s called a financial analysis. And a lot of those skills that you’re learning is give you the ability to make good, what we call investment decisions, or if you like capital expenditure. So sure there’s the underlying financial analysis, then a lot of it is applying it to the real world. And that’s what I’ve said before is that we try to do a lot in our teaching in the Finance major, of really integrating real world finance in your learnings.
John Kennedy 18:51
Great. And I know you’ve touched on this already, but how maths heavy is the major?
Dr Scott Walker 18:56
It’s not maths heavy. It’s not. It’s not mathematical finance .Definitely not. The maths that you need, we teach you as part of the subjects in the Finance major. So there’s no assumed mathematics; there’s no assumed level of mathematics for the Finance major. In fact, I think even to get into the Bachelor of Business, you just need to have done some maths. But yeah, do not by any means think; we teach you the maths that you need to know and it’s not high level mathematics at all, by no means. Because we’re trying to make we’re trying to teach you very applied finance, and it’s not mathematical, so it’s not mathematical finance. It’s much more applied.
John Kennedy 19:46
And I get I think you’ve definitely touched on this in your presentation. But would a major in Finance and a major in Management work well? and just in general, what majors would complement Finance well?
Dr Scott Walker 19:57
Yeah. The Finance and Accounting majors, they complement each other very well. And they are different. They are different. But there are some there are some similarities. But look a Bachelor, sorry, a Finance major with a Management major. That works as well, definitely. But it kind of depends on on you, if you’re interested in finance, but management, you’ve got that ability to choose those two majors. And like I’ve always said, find something that interests you. There’s nothing wrong with combining finance with management. But that may not complement each other, as well as let’s say, finance and accounting.
John Kennedy 19:57
We’ve just had another question through; how far can you take a Bachelor of Business? Can you then move on to your Masters for instance, in finance?
Dr Scott Walker 20:52
Oh, most definitely. In fact we have a number of people that; a number of students that do the finance, sorry, do the Bachelor of Business with a Finance major, and then they will go on to do postgraduate study. So yeah, definitely. In fact UTS has even got recently, we introduced a Masters of Financial Planning. And we’ve had some students who’ve done the Bachelor of Business, and then decide; oh what am I going to do next, I might get into financial planning. And so they’ll do a Masters in Financial Planning. Again, we’ve got a number of postgraduate offerings, but again, yeah. That’s, that’s all postgraduate information. And definitely, you can definitely, definitely take it as far as you want.
John Kennedy 21:45
Yeah. And your thoughts on what you might want to do at a Masters level might change as you go through the Bachelor of Business. So just be aware that you know, you’re not restricted in any way; there are multiple pathways and different Masters you can take once completing the Bachelor of Business. So it’s very flexible in that way, opens a lot of opportunities for further study and career paths.
I don’t know the answer to this one; have the rules tighten about becoming a Financial Planner in Australia?
Dr Scott Walker 22:15
Yeah, they have because the educational standards have been tightened because now they are; financial planners are required to have at least a Bachelors, sorry, have had postgraduate studies. So that’s where a lot of the demand for our Masters in Financial Planning is coming from to meet those higher accreditation standards. Yeah, definitely.
John Kennedy 22:40
Great. That’s good to know. And then, as Scott mentioned, there is a Masters program so you can complete the Bachelors, and then move into that Financial Planning Masters degree afterwards to meet those new standards, if that’s an area of a career that you’re interested in.
Dr Scott Walker 22:54
Exactly right.
Scott, thank you very much for that it was very informative and everyone you can obviously remain in contact with the School we’re here to help you as much as possible. Thank you for attending this session. Scott. Thank you very much, and I hope you all have a good day.
Thank you everyone. And thank you John.