Finance thesis writing guide

Defining the finance thesis

Finance refers to the management of money, typically for commercial ends, but also for public policy purposes. Finance is conceptually close to accounting, but differs in being a more creative activity. Whereas accounting is tightly constrained by such factors as regulatory regimes and generally accepted accounting practices (GAAP), finance is an open pursuit. Money can be raised, and managed, in a bewildering variety of ways, making the crafting of a finance thesis a rather more open-ended pursuit. Howsoever it develops, a finance thesis must focus tightly on the more creative aspects of money management.

Researching your finance thesis

There are two kinds of finance thesis: the finance thesis that is closer in spirit to an academic thesis, and the finance thesis that exists in the world of practice. It is worth taking some time to understand this distinction, because the path taken in researching your finance thesis will depend upon it. The academic finance thesis has a strong theoretical component while the practical finance thesis is more concerned with depicting and analyzing finance as it takes place on the ground. For example, the academic finance thesis may draw extensively upon theoretical concepts such as the business cycle or game theory whereas the practical finance thesis will remain empirically grounded in the activities of actual finance experts or companies. Research procedures differ accordingly, with the academic finance thesis utilizing statistical research, market information, and other such data while the practical finance thesis may draw more closely upon interviews or case studies. That said, it is worth noting that many academic finance theses draw upon empirical support for the theories under discussion.

Structuring your finance thesis

The first question to answer is: what kind of finance thesis are you writing? Have you been drawn by the theory of finance, or are you more fascinated by the practice of finance? Answering this question allows you not only to take the best path in structuring your finance thesis but also in deciding what is likely to interest your audience. The academic finance thesis will appeal strongly to theoreticians, and should this follow the accepted format of a business thesis: a problem/introduction statement followed by a literature review, methodology, argument, conclusion, and references. The practical finance thesis, however, will proceed in a different way. It need not be constrained by academic conventions. It is perfectly valid to structure a practical finance thesis in the more general form of: introduction, argument, conclusion, and references, leaving out the literature review and methodology. For example, if your practical finance thesis is a study of how one company raised money for its new product development cycle, the point is to focus in tightly on that company’s finance practices, not overwhelm the reader with unnecessary allusions to academic literature, or to dwell on a complex methodology. In this way, structuring your practical finance thesis is largely a matter of adopting the format that is best suited to telling your story.

Financial thesis possibilities

As in economics, accounting, and other subjects, it pays to be creative when researching, structuring, and writing your finance thesis. Bear in mind that finance is not simply an esoteric way in which large enterprises and banks raise money for business. Finance is universal. Household finance—the ordinary budget—is a kind of finance that all of us practice. Government finance, driven by taxes and presided over by politicians, is also something that impacts everyone. If your aim is to write a finance thesis with maximum appeal to non-insiders in finance, pursue a thesis to which a large number of readers can relate. Don’t think of finance as an enshrined set of practices but as a basic human activity and you will be on the right track!

Along these lines, remember that, even from a business view, finance is not as narrowly defined as you may believe. Consider that merger and acquisition (M&A) activity is fertile ground for financial thesis possibilities. M&A, a set of financial transactions, can trigger all kinds of fascinating business repercussions: layoffs (which have massive personal and public policy implications), executive turnover, and the rise and fall of companies. Business decisions rooted in finance are not limited in impact to ledgers and rows of numbers; rather, they touch everyone within a company, from ordinary workers to CEOs, and can even impact entire communities and countries. Finance underlies much of what any business does, so just about any business thesis can in some way be made relevant to finance.