| Learning objectives |
To achieve the grade 12, students should meet the
following learning objectives with no or only minor mistakes or
errors: 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 aim of the course is that students after having followed the
course are 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 |
|
Financial
Markets & Instruments:
|
| 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 |
Autumn, The regular exam will be held in January.
The make-up/re-exam takes place in February or March. |
| 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 topics we will explore include the following:
- the basics of risk and return
- the investment process and the importance of asset
allocation
- how markets operate
- portfolio theory and how to form optimal portfolios
- equilibrium models of security prices
- 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 term structure of interest rates
- the use and valuation of derivatives
Course status
This constitutes a basic course in capital market theory and
instruments and forms the basis for second semester course in risk
management.
|
| Teaching methods |
| Lectures with exercises. |
| Feedback during the teaching period |
1) Online concept checks at the beginning or end
of classes using "Socrative"
2) Self-paced quiz'es with built-in feedback (LEARN)
3) Mid-tern paper with pair-wise student feedback and optional
teacher feedback. |
| Student workload |
| Lectures |
33 hours |
| Preparation for Lectures |
66 hours |
| Exercises |
18 hours |
| Prepartion for Exercises |
45 hours |
| Exam |
4 hours |
| Preparation for Exam |
40 hours |
|
| Expected literature |
|
Bodie, Kane & Marcus: Investments, Global 10th
edition, McGraw Hill,
ISBN - 9780077161149.
Slides, spreadsheets, articles (Uploaded on LEARN).
|
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