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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) Class test 20%
  2 hour examination (Summer) 80%
VA (Visiting students only) 100% assessed for visiting/exchange students (1) 40%
  100% assessed for visiting/exchange students (2) 60%
15 CATS (Module code: IB253-15)
D1 (Assessed/examined work) Class test 20%
  2 hour examination (Summer) 80%
VA (Visiting students only) 100% assessed for visiting/exchange students (1) 40%
  100% assessed for visiting/exchange students (2) 60%

Module availability

This module is available on the following courses:

Core

N/A

Optional Core

N/A

Optional
  • Undergraduate Chemistry with Management (F1N1) - Year 3
  • Undergraduate Chemistry with Management (with Intercalated Year) (F1N2) - Year 4
  • Undergraduate Physics and Business Studies (F3N1) - Year 3
  • Undergraduate Physics and Business Studies (with Intercalated Year) (F3ND) - Year 4
  • Undergraduate Mathematics (BSc) (G100) - Year 3
  • Undergraduate Mathematics with Intercalated Year (G101) - Year 4
  • Undergraduate Mathematics (MMath) (G103) - Year 3
  • Undergraduate Mathematics (MMath) (G103) - Year 4
  • Undergraduate Master of Mathematics (with Intercalated Year) (G105) - Year 3
  • Undergraduate Master of Mathematics (with Intercalated Year) (G105) - Year 4
  • Undergraduate Master of Mathematics (with Intercalated Year) (G105) - Year 5
  • Undergraduate Mathematics (MMath) with Study in Europe (G106) - Year 3
  • Undergraduate Mathematics (MMath) with Study in Europe (G106) - Year 4
  • Undergraduate Mathematics and Statistics (BSc MMathStat) (G1G3) - Year 3
  • Undergraduate Mathematics and Statistics (BSc MMathStat) (G1G3) - Year 4
  • Undergraduate Mathematics and Business Studies (with Intercalated Year) (G1N2) - Year 4
  • Undergraduate Mathematics and Business Studies (G1NC) - Year 3
  • Undergraduate Master of Mathematics,Operational Research,Statistics and Economics (G300) - Year 3
  • Undergraduate Master of Mathematics,Operational Research,Statistics and Economics (G300) - Year 4
  • Undergraduate Master of Mathematics,Operational Research,Statistics and Economics (G30A) - Year 3
  • Undergraduate Master of Mathematics,Operational Research,Statistics and Economics (G30A) - Year 4
  • Undergraduate Master of Mathematics,Operational Research,Statistics and Economics (G30A) - Year 5
  • Undergraduate Master of Mathematics,Operational Research,Statistics and Economics (G30B) - Year 3
  • Undergraduate Master of Mathematics,Operational Research,Statistics and Economics (G30B) - Year 4
  • Undergraduate Master of Mathematics,Operational Research,Statistics and Economics (G30B) - Year 5
  • Undergraduate Master of Mathematics,Operational Research,Statistics and Economics (G30C) - Year 3
  • Undergraduate Master of Mathematics,Operational Research,Statistics and Economics (G30C) - Year 4
  • Undergraduate Master of Mathematics,Operational Research,Statistics and Economics (G30C) - Year 5
  • Undergraduate Master of Mathematics,Operational Research,Statistics and Economics (G30D) - Year 3
  • Undergraduate Master of Mathematics,Operational Research,Statistics and Economics (G30D) - Year 4
  • Undergraduate Master of Mathematics,Operational Research,Statistics and Economics (G30D) - Year 5
  • Undergraduate Master of Mathematics,Operational Research,Statistics and Economics (with Intercalated (G30E) - Year 3
  • Undergraduate Master of Mathematics,Operational Research,Statistics and Economics (with Intercalated (G30E) - Year 4
  • Undergraduate Master of Mathematics,Operational Research,Statistics and Economics (with Intercalated (G30E) - Year 5
  • Undergraduate Master of Mathematics,Operational Research,Statistics and Economics (with Intercalated (G30F) - Year 3
  • Undergraduate Master of Mathematics,Operational Research,Statistics and Economics (with Intercalated (G30F) - Year 4
  • Undergraduate Master of Mathematics,Operational Research,Statistics and Economics (with Intercalated (G30F) - Year 5
  • Undergraduate Master of Mathematics,Operational Research,Statistics and Economics (with Intercalated (G30G) - Year 3
  • Undergraduate Master of Mathematics,Operational Research,Statistics and Economics (with Intercalated (G30G) - Year 4
  • Undergraduate Master of Mathematics,Operational Research,Statistics and Economics (with Intercalated (G30G) - Year 5
  • Undergraduate Master of Mathematics,Operational Research,Statistics and Economics (with Intercalated (G30H) - Year 3
  • Undergraduate Master of Mathematics,Operational Research,Statistics and Economics (with Intercalated (G30H) - Year 4
  • Undergraduate Master of Mathematics,Operational Research,Statistics and Economics (with Intercalated (G30H) - Year 5
  • Undergraduate Computer and Management Sciences (G5N1) - Year 3
  • Undergraduate Computer and Management Sciences (with Intercalated Year) (G5NA) - Year 4
  • Undergraduate Mathematics and Statistics (BSc) (GG14) - Year 3
  • Undergraduate Mathematics and Statistics (with Intercalated Year) (GG17) - Year 4
  • Undergraduate Computer and Business Studies (GN51) - Year 3
  • Undergraduate Computer and Business Studies (with Intercalated Year) (GN5A) - Year 4
  • BSc Engineering and Business Studies (HN11) - Year 3
  • Undergraduate Economics 3 Year Variants (L100) - Year 2
  • Undergraduate Economics 3 Year Variants (L116) - Year 3
  • Undergraduate Economics 4 Year Variants (L117) - Year 4
  • Undergraduate Economics, Politics and International Studies (LM1D) - Year 2
  • Undergraduate Law and Business Studies (MN32) - Year 4
  • Law and Business Four Year (Qualifying Degree) (MN34) - Year 4
  • Undergraduate Law and Business Studies with Intercalated Year (4+1) (MN36) - Year 5
  • Undergraduate Law and Business Studies (Qualifying Degree) with Intercalated Year (MN37) - Year 5
  • Undergraduate Philosophy, Politics and Economics (V7ML) - Year 2
  • Undergraduate Philosophy, Politics and Economics (V7ML) - Year 3
  • Undergraduate Philosophy, Politics and Economics (with Intercalated year) (V7MM) - Year 4
  • Undergraduate Philosophy, Politics and Economics (V7MP) - Year 2
  • Undergraduate Philosophy, Politics and Economics (V7MP) - Year 3
  • Undergraduate Philosophy, Politics and Economics (with Intercalated year) (V7MQ) - Year 4
  • Undergraduate Philosophy, Politics and Economics (V7MR) - Year 2
  • Undergraduate Philosophy, Politics and Economics (V7MR) - Year 3
  • Undergraduate Philosophy, Politics and Economics (V7MR) - Year 4
  • Undergraduate Philosophy, Politics and Economics (with Intercalated year) (V7MS) - Year 4
  • Undergraduate Mathematics,Operational Research,Statistics and Economics (Y602) - Year 3
  • Undergraduate Mathematics,Operational Research,Statistics,Economics (with Intercalated Year) (Y603) - Year 4