|This course offers the financial theory and quantitative analytical tools necessary for understanding how stock, bond, and option prices are determined, and provides the skills required to make sound investment decisions. Topics covered include the following: the term structure of interest rates; portfolio selection based on mean-variance analysis; models of risk and return (including the CAPM and multifactor models); performance evaluation of mutual funds and hedge funds; market efficiency (including asset pricing anomalies and behavioral finance); derivative security pricing (including options, futures, forwards, and swaps); and international investment.
The theoretical concepts and intuition presented in the course are applied on real-world data and problems, both in class and in homework assignments. An array of analytical and statistical skills will be developed throughout the course.
|The main texts used for the course are Bodie, Kane, and Marcus, Investments; and a CoursePack.
Suggestions: Malkiel, Burton G., A Random Walk Down Wall Street, and Siegel, Jeremy J., Stocks for the Long Run.
|Based on 5-6 homework assignments, a case write-up and discussion, a mid-term, and a final. Cannot be taken pass/fail. No auditors.|
|Business 30000, 33001, and 41000 or 41100. Students must be comfortable with statistics, linear and matrix algebra, calculus, and microeconomics at the level of the above courses. Familiarity with a spreadsheet package such as Excel is vital.|
|Sample Exam Questions/Problem Sets:|
|Sample questions are available to registered students in Chalk.
Description and/or course criteria last updated: 07/2012
|Course Conditions and Course Related Items:|