EXC 3612 Investment Analysis
EXC 3612 Investment Analysis
This course’s objective is to provide a deeper understanding of the financial markets, the securities that are traded on these markets and choices and issues of concern to all investors. We focus on three elements. (a) The investment environment: the different securities traded in the markets, where they are traded and how they are traded. (b) Security valuation: what drives the value of the different securities and how to account for these. (c) Investment process: how should investors select and construct their investment portfolio.
Upon completion of the course, students shall comprehend key concepts investment and portfolio management, including
- Expected returns and idiosyncratic as well as portfolio risks
- The concept of diversification
- Determinant of bond value and risk
- The concepts of duration and convexity as well as interest risk management
- Determinants of option values and option strategies (if time permits)
Upon completion of the course, students are required to master tasks such as;
- Calculating estimates of expected return and risk from a series of past returns
- Applying modern portfolio theory for finding optimal investment portfolios
- Calculating required rates of return and risk based on various asset pricing models
- Calculating yields to maturity, duration and convexity on bonds
- Construct option strategies to hedge equity risk
- Implement portfolio optimization and bond valuation in Excel or R
- Value options with the binomial valuation model (if time permits)
- Upon completion of the course, the students shall be able to ask critical questions and reflect on crucial assumptions and theories within the field of financial investments.
- Bond Valuation
- The Term Structure of Interest Rates
- Stock Valuation models
- Risk and Expected Return
- Modern Portfolio Theory
- Equilibrium in Capital Markets
- Market Efficiency
- Performance evaluation
- Introduction to derivatives: options and futures (if time permits)
The course will include a combination of lectures, tutorials where solutions to exercises will be explained, and online assignments.
Specific Information regarding any aspect of performance assessment will be provided in class. It is the student’s responsibility to obtain any information provided in class that is not included on the course homepage/itslearning or in the textbook. Homepages and/or itslearning are not designed for the purpose of students who choose not to attend class.
To add practical values to the course, digital tools such as Excel or R are used in many examples. Such digital tools, however, are not allowed at the examination.
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Higher Education Entrance Qualification
Disclaimer
Deviations in teaching and exams may occur if external conditions or unforeseen events call for this
EXC 2910 Mathematics, EXC 2904 Statistics, EXC 2110 Basic Financial Management, or equivalent.
| Assessments |
|---|
Exam category: School Exam Form of assessment: Structured Test Exam/hand-in semester: First Semester Weight: 100 Grouping: Individual Support materials:
Duration: 3 Hour(s) Exam code: EXC36121 Grading scale: ECTS Resit: Examination every semester |
| Activity | Duration | Comment |
|---|---|---|
Teaching | 39 Hour(s) | |
Feedback activities and counselling | 3 Hour(s) | Review of assignments in plenary |
Prepare for teaching | 48 Hour(s) | |
Group work / Assignments | 30 Hour(s) | |
Student's own work with learning resources | 80 Hour(s) |
A course of 1 ECTS credit corresponds to a workload of 26-30 hours. Therefore a course of 7,5 ECTS credit corresponds to a workload of at least 200 hours.