Course Description: Examination of theories and evidence on the investment decision process including operations of equity securities markets, market efficiency, financial asset prices, and portfolio management. Prerequisites: BSAD 181; Business Administration major or minor; Minimum Junior standing. Co-requisite: BSAD 280.
Section Description: This course is an introduction to the field of investments. Topics covered will include a survey of the types of financial instruments, the study of how they are bought and sold, and an introduction to how they are valued in the marketplace. Valuation topics will include, the basics of portfolio theory, models of asset pricing, and an introduction to the pricing of options and futures contracts. I will emphasize issues relating to market efficiency (do asset prices accurately reflect public information), and the valuation of derivative securities. The former is important because it is an extremely useful organizing paradigm. The latter is important because the absence of arbitrage principle on which option pricing theory is based provides the framework for modern finance (this material will also provide important background material for International Finance and other advanced finance courses). I will not stress fundamental analysis (using forecasts of earnings and interest rates to determine company valuations). This material is covered in BSAD181 and BSAD 288. I will focus on the fundamental concepts underlying the management and analysis of investments in a portfolio context. Specifically, when you successfully complete this course you will: 1) Understand the purposes served by the wide-range of traded financial assets 2) Understand the concept and practice of efficient diversification 3) Be able to use capital market theory to estimate asset risk premiums 4) Understand the basics of how derivatives are priced and used 5) Appreciate both the compelling logic in favor of market efficiency and some of the evidence against it 6) Understand the basics of portfolio analysis and management
|M||17:05 - 20:05||KALKIN BUILDING 003|
Instructor(s): Andrey Dmitrievich Ukhov
Meeting Dates: 26 Aug 2019 - 06 Dec 2019