2024/2025
Investment analysis and portfolio management
Type:
Minor
Delivered by:
Department of Finance
When:
1, 2 module
Open to:
students of all HSE University campuses
Instructors:
Vasilisa A. Makarova
Language:
English
ECTS credits:
5
Contact hours:
60
Course Syllabus
Abstract
The course focuses on different investment techniques. We will examine the fundamentals of portfolio investment, the basics of technical and fundamental analysis, as well as the methods of risk management in the financial market.
Learning Objectives
- Provide comprehensive knowledge on managing an investor's financial portfolio and evaluating the effectiveness of this management
Expected Learning Outcomes
- Student knows global issues.
- Explain the intuition behind the pecking order theory of finance
- Students are able to critically evaluate current research in this field.
- Students are familiar with empirical evidence which support or reject hypothesis and predictions of a theory.
- Students know how and when finance theory can be applied to achieve a desired goal.
- Students know mathematics of finance theory and methodology of financial decisions.
- Students understand specific questions the theory addresses.
- Students are able to apply CAPM to estimate cost of equity in different frameworks; to calculate the value of stock using DDM; to calculate the cost of debt; to evaluate different types of bonds; to assess the corporate debt; to calculate value of convertible bond and common shares.
- Students understand pinciples of portfolio approach, derivation of CAPM, its constraints; alternative models principles, principles of stock valuation, principles of bonds valuation.
- Student is familiar with empirical evidence, which support or reject hypothesis and predictions of a theory, able to critically evaluate current research in this field.
- Student understands specific questions the theory addresses, understands that finance issues are not isolated from each other, knows how and when finance theory can be applied to achieve a desired goal.
- Student understands time value of money, patterns of financial decision making in increasing complexity of financial environment, knows mathematics of finance theory and methodology of financial decisions.
- Student understands, which theory is applicable in these circumstances and what are its practical limits.
- - Learn different types of financial markets & financial instruments (stocks vs. bonds);
- Students should be able to discuss the main theoretical and empirical drivers of stock valuation.
- Know the concept of uncertainty and risk in the modern theory of finance. Understand capital asset pricing model. Understand arbitrage theory of asset pricing. Can compare call and put options
- Knowledge of techniques used for stock valuation
- Learn the concept of CAPM & APT
- Knowing the steps of the asset allocation process, understanding the discussion on market efficiency and price predictability, its reasons and consequences.
- - to obtain the skills to create financial models related to investments; - to know how to use various information and data sources to analyze and process data for economic and financial estimations; - to collect, process and present information on various national financial markets;
- Discuss stock valuation. Apply dividend discounting model. Describe financial multipliers, apply them for stock valuation. Discuss bond valuation. Calculate bond fair price. Define yield to maturity. Calculate yield to maturity.
- - explain benefits of securitization for economies and financial markets;
- Be able to evaluate financial assets and form portfolios of assets
- Explain the specification of asset classes in relation to asset allocation
- Distinguish between the methods of accounting for investments in an equity portfolio and an associate
Course Contents
- The Asset Allocation Decision
- Industry Analysis. Company Analysis and Stock Valuation
- Macroeconomic and Market Analysis
- An Introduction to Portfolio Management
- Stock Market Analysis
- Selecting Investments in a Global Market
- Equity Portfolio Management Strategies
- Efficient Capital Markets
- 1. Asset Allocation Problem and Utility Curve
- Organization and Functioning of Securities Markets
Bibliography
Recommended Core Bibliography
- Alexander, G. J., Sharpe, W. F., & Bailey, J. V. (2012). Fundamentals of investments. Slovenia, Europe: Prentice Hall. Retrieved from http://search.ebscohost.com/login.aspx?direct=true&site=eds-live&db=edsbas&AN=edsbas.C1BEBDC4
- Capital markets. Institutions and instruments, Fabozzi F.J., Modigliani F., 1996
- Fabozzi, F. J., & Peterson, P. P. (2003). Financial Management and Analysis (Vol. 2nd ed. Frank J. Fabozzi, Pamela P. Peterson). Hoboken: Wiley. Retrieved from http://search.ebscohost.com/login.aspx?direct=true&site=eds-live&db=edsebk&AN=91823
- FAMA, E. F. (1970). Efficient Capital Markets: A Review of Theory and Empirical Work. Journal of Finance (Wiley-Blackwell), 25(2), 383–417. https://doi.org/10.2307/2325486
- Financial economics : a concise introduction to classical and behavioral finance, Hens, T., 2010
- Fixed income mathematics : analytical and statistical techniques, Fabozzi, F. J., 2006
- Fixed income securities, Fabozzi, F. J., 2002
- Foundations of financial markets and institutions, Fabozzi, F. J., 2014
- Foundations of financial markets and institutions., Fabozzi, F.J., 2014
- Investment management, Fabozzi, F. J., 1995
- Peterson Drake, P., & Fabozzi, F. J. (2010). The Basics of Finance : An Introduction to Financial Markets, Business Finance, and Portfolio Management. Hoboken, NJ: Wiley. Retrieved from http://search.ebscohost.com/login.aspx?direct=true&site=eds-live&db=edsebk&AN=335336
- Quantitative equity portfolio management : an active approach to portfolio construction and management, Chincarini, L. B., 2006
Recommended Additional Bibliography
- Capital Markets : Institutions and Instruments, Fabozzi, F. J., 1996
- Fabozzi, F. J., & Markowitz, H. (2011). The Theory and Practice of Investment Management : Asset Allocation, Valuation, Portfolio Construction, and Strategies (Vol. 2nd ed). Hoboken, N.J.: Wiley. Retrieved from http://search.ebscohost.com/login.aspx?direct=true&site=eds-live&db=edsebk&AN=364873
- Fabozzi, F. J., Modigliani, F., & Jones, F. J. (2014). Foundations of Financial Markets and Institutions: Pearson New International Edition (Vol. Fourth edition Fabozzi, Modigliani, Jones). Harlow, Essex: Pearson. Retrieved from http://search.ebscohost.com/login.aspx?direct=true&site=eds-live&db=edsebk&AN=1418493
- Financial management and analysis, Fabozzi F.J., Peterson P.P., 2003
- Richards, T. (2014). Investing Psychology : The Effects of Behavioral Finance on Investment Choice and Bias. Hoboken, New Jersey: Wiley. Retrieved from http://search.ebscohost.com/login.aspx?direct=true&site=eds-live&db=edsebk&AN=759584