The purpose of Introduction to Finance module is to provide an overview of the financial system, instruments, markets and related theoretical concepts and debates.
Module aims
The aim is to give students an understanding of financial processes and underlying analytical principles. The module will first consider the structure and role of the City of London - the complex network of financial markets located in London's Square Mile - which will be analysed in the context of the UK and international markets. The syllabus covers a range of current topics within the finance field such as the relationship between risk and return, as well as the concept of present value in the context of bond markets. The link between interest rates, bond prices and notions of risk is also investigated, and students are required to develop an understanding of the role of present value models in capital markets as the basis for discussing the Efficient Markets Hypothesis. Finally, the use of financial options will be discussed.
Learning outcomes
After completing this module students should be able to:
1. Discuss the various traditions, concepts and techniques within finance as a subject discipline
2. Describe the major features of the financial system including markets and institutions
3. Understand the relationship between risk and return and the concept of diversification
4. Understand the role of present value in bond and equity valuation models and describe the role of derivative markets
5. Have an appreciation of the issues underlying the efficient market hypothesis and the role of the City of London
Syllabus
1. Introduction to financial markets and instruments
2. Investment companies
3. Risk and return
4. Diversification
5. Capital asset pricing model (CAPM)
6. The Efficient market hypothesis
7. Behavioural Finance and Technical Analysis
8. Fundamental analysis
9. Bonds
10. Financial options
Assessment
Formative:
Past test paper practice
Summative:
In order to pass this module, you must pass the final exam with at least 40% and the aggregate (coursework and exam) module mark with at least 40%. The coursework weighting is 50% and the exam weighting is 50%.
Coursework consists of:
In-class test 1: week 32 (40%). Feedback will be provided in week 35.
In-class test 2: week 36 (60%). Feedback will be provided in week 39.
A final 2 hour exam.
Module aims
The aim is to give students an understanding of financial processes and underlying analytical principles. The module will first consider the structure and role of the City of London - the complex network of financial markets located in London's Square Mile - which will be analysed in the context of the UK and international markets. The syllabus covers a range of current topics within the finance field such as the relationship between risk and return, as well as the concept of present value in the context of bond markets. The link between interest rates, bond prices and notions of risk is also investigated, and students are required to develop an understanding of the role of present value models in capital markets as the basis for discussing the Efficient Markets Hypothesis. Finally, the use of financial options will be discussed.
Learning outcomes
After completing this module students should be able to:
1. Discuss the various traditions, concepts and techniques within finance as a subject discipline
2. Describe the major features of the financial system including markets and institutions
3. Understand the relationship between risk and return and the concept of diversification
4. Understand the role of present value in bond and equity valuation models and describe the role of derivative markets
5. Have an appreciation of the issues underlying the efficient market hypothesis and the role of the City of London
Syllabus
1. Introduction to financial markets and instruments
2. Investment companies
3. Risk and return
4. Diversification
5. Capital asset pricing model (CAPM)
6. The Efficient market hypothesis
7. Behavioural Finance and Technical Analysis
8. Fundamental analysis
9. Bonds
10. Financial options
Assessment
Formative:
Past test paper practice
Summative:
In order to pass this module, you must pass the final exam with at least 40% and the aggregate (coursework and exam) module mark with at least 40%. The coursework weighting is 50% and the exam weighting is 50%.
Coursework consists of:
In-class test 1: week 32 (40%). Feedback will be provided in week 35.
In-class test 2: week 36 (60%). Feedback will be provided in week 39.
A final 2 hour exam.