|This course offers the financial theory and quantitative tools necessary for understanding how stock, bond, and option prices are determined, and how financial assets are used for 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; market efficiency and the random walk hypothesis; asset pricing anomalies and behavioral finance; derivative security pricing (including options, futures, forwards, and swaps); and international investment.|
|The main text used for the course is Bodie, Kane, and Marcus, Investments; and a selection of readings which will be posted in Chalk.|
|Based on 5-6 homework assignments, a case write-up and discussion, a mid-term, and a final.|
|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.
Description and/or course criteria last updated: 08/20/2013
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