| Learning objectives |
To achieve the grade 12, students should meet the
following learning objectives with no or only minor mistakes or
errors: Upon completion of the course the student should be able
to:
- Explain the concepts, theories, models, and methods for
portfolio selection, risk measurement and management, the
risk-return tradeoff, and the pricing of stocks, bonds, and
derivative securities as discussed during the course.
- Discuss the theoretical and empirical validity of the central
theories and models developed in the course.
- Apply the theories and models to realistic problems.
- Implement relevant models using Excel or similar computational
tools
- Discuss the role of capital markets, the efficiency of capital
markets, and theories about investor behavior
|
| Examination |
|
Capital Market
Theory:
|
| Exam
ECTS |
7,5 |
| Examination form |
Written sit-in exam on CBS'
computers |
| Individual or group exam |
Individual exam |
| Assignment type |
Written assignment |
| Duration |
4 hours |
| Grading scale |
7-step scale |
| Examiner(s) |
One internal examiner |
| Exam period |
Winter |
| Aids |
Limited aids, see the list below:
The student is allowed to bring - USB key for uploading of notes, books and compendiums in a
non-executable format (no applications, application fragments, IT
tools etc.)
- Any calculator
- Books (including translation dictionaries), compendiums and
notes in paper format
The student will have access to - Access to CBSLearn
- Access to the personal drive (S-drive) on CBS´ network
- Advanced IT application package
At all written
sit-in exams the student has access to the basic IT application
package (Microsoft Office (minus Excel), digital pen and paper,
7-zip file manager, Adobe Acrobat, Texlive, VLC player, Windows
Media Player). PLEASE NOTE: Students are not allowed to communicate
with others during the exam :
Read more about exam aids and IT application
packages here |
| Make-up exam/re-exam |
Same examination form as the ordinary exam
If the number of registered candidates for the make-up
examination/re-take examination warrants that it may most
appropriately be held as an oral examination, the programme office
will inform the students that the make-up examination/re-take
examination will be held as an oral examination
instead.
|
|
| Course content and structure |
|
The objective of the course is to develop a deeper understanding
of the role and inner workings of financial markets and financial
instruments such as stocks, bonds, and derivatives. We will place
particular emphasis on helping you develop a systematic way of
thinking about and making investment decisions.
The topics we will explore include the following:
• the basics of risk and return
• the investment process and the importance of asset allocation
• how financial markets operate
• portfolio theory and how to form optimal portfolios
• index models, alphas and betas
• equilibrium models of security prices, including the Capital
Asset Pricing Model
• security price anomalies such as the size, book-to-market, and
momentum effects in stock returns
• the behavioral approach to finance and its role in understanding
price anomalies
• the role of fixed income securities in the portfolio
• the use and valuation of derivatives
|
| Teaching methods |
| Lectures with exercices. |
| Feedback during the teaching period |
| Feedback will be provided either as part of group
works or discussions in the class. |
| Student workload |
| Preparation for and participation in lectures |
77 hours |
| Preparation for and participation in exercise classes |
108 hours |
| Preparation for and participation in exam |
21 hours |
|
| Expected literature |
|
Bodie, Kane and Marcus, Investments and Portfolio
Management, McGraw-Hill, 9th edition
Lecture notes
|
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