This module extends MA1801 Finance I (Financial Markets and Corporate Financial Management) and focuses on financial markets, investments and instruments. The key topics include investment risk/returns, portfolio analysis, capital asset pricing model (CAPM) and arbitrage pricing theory (APT), Efficient Market Hypothesis (EMH), equity dynamics and valuation and bond valuation (e.g. duration analysis, term structure determination and yield spreads).         

Prerequisite Module: MA1801 Finance I: Financial Markets and Corporate Financial Management

On completion of this module students should be able to;

1. Critically interpret and assess portfolio theory, risk and return;
2. Evaluate asset pricing model/theory, common factor models and performance measures;
3. Assess equities dynamics and evaluate equity valuation techniques and risk analysis;
4. Evaluate and compare the features of fix-income instruments such as bonds and implement bond valuation techniques, duration analysis and yield spreads.

Modules will be delivered through blended learning. You will be guided through learning activities appropriate to your module, which may include:

• Weekly face to face classes (e.g. labs, lectures, exercise classes)
• Electronic resources that you work through at your own pace (e.g. videos, exercise sheets, lecture notes, e-books, quizzes)

Students are also expected to undertake self-guided study throughout the duration of the module.

Skills:

Abilities to apply asset pricing models in real cases and fundamental understanding of portfolio theories as well as return & risk; evaluation skills to valuate equities and bonds; Analytical skills for risk analysis.

Transferable Skills:

• Numerical analysis skills
• Modelling skills
• Critical thinking
• Problem solving skills
• Collaborative skills
• Time management

• Investment Risk and Returns
• Portfolio Theory
• Capital Asset Pricing Model (CAPM)
• Common Factor Models (including momentum) & Performance Measurement (Sharpe Ratio etc., Asset allocation)
• Arbitrage pricing theory (APT)
• EMH
• Equity Valuation
• Bond Valuation
• Financial derivatives as investment vehicles