IB253 - Principles of Finance 1
- Module code: IB253
- Module name: Principles of Finance 1
- Department: Warwick Business School
- Credit: 12, 15
Content and teaching | Assessment | Availability
Module content and teaching
Principal aims
The module aims to: introduce you to the workings of the equity and bond markets; equip you with the skills and understanding to use quantitative tools for pricing stocks and bonds; develop your critical understanding of the trade-off between risk and return, and of techniques for exploiting that trade-off to optimal effect; make you aware of key empirical tests of asset-pricing models and of market efficiency, and the implications of those empirical findings; provide you with structured opportunities to practise using the key tools and techniques of Financial Markets theory; prepare you for advanced undergraduate studies in Finance.
Principal learning outcomes
By the end of the module, you should be able to: describe how the equity and bond markets function, and their importance to both individual investors and institutions; use discounted cash-flow techniques to value stocks and bonds, and spreadsheets to test how robust those values are to changes in key inputs; explain how risk can be diversified by forming portfolios of assets, and how to construct an optimum portfolio of risky assets; critically assess both theoretical and empirical relationships between risk and return; formulate different hypotheses for the term structure of interest rates; calculate spot and forward rates of interest from observed prices of calibration bonds, and use those rates to price other bonds and identify arbitrage opportunities; define the different forms of market efficiency, and interpret the results of key tests of the Efficient Markets Hypothesis; write informed critiques of key issues in asset valuation and empirical testing of asset-valuation models; analyse brief case-studies and construct arguments to support a particular solution; use web-based resources to find and retrieve financial-market data, and spreadsheets to process that data; explain and interpret financial-market data.
Timetabled teaching activities
2 x 1 hour lectures per week, 1 x 1 hour seminar per week
Departmental link
http://www.wbs.ac.uk/students/undergraduate/
Module assessment
Assessment group | Assessment name | Percentage |
---|---|---|
12 CATS (Module code: IB253-12) | ||
D1 (Assessed/examined work) | Assessed Course Work | 20% |
Examination - Main Summer Exam Period (weeks 4-9) | 80% | |
Assessed Course Work | 40% | |
Assessed Course Work | 60% | |
15 CATS (Module code: IB253-15) | ||
D1 (Assessed/examined work) | Assessed Course Work | 20% |
Examination - Main Summer Exam Period (weeks 4-9) | 80% |
Module availability
This module is available on the following courses:
Core
N/A
Optional Core
N/A
Optional
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