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Module Specifications

Archived Version 2003 - 2004

Module Title Securities and Investments
Module Code EF504
School DCUBS

Online Module Resources

Level 5 Credit Rating 5
Pre-requisite None
Co-requisite None
Module Aims
To familarise students with the types and characteristics of the major classes of investment securities in use in domestic and international financial markets and the theory and practice of valuing those securities. This course is taught from the perspective of the investment manager

Learning Outcomes
Students will be familiar with a broad range of securities and derivative instruments along with the environment in which they have been developed and used.

Indicative Time Allowances
Lectures 48
Tutorials 0
Laboratories 0
Seminars 0
Independent Learning Time 27

Total 75
Assume that a 5 credit module load represents approximately 75 hours' work, which includes all teaching, in-course assignments, laboratory work or other specialised training and an estimated private learning time associated with the module.

Indicative Syllabus
The nature and characteristics of financial instruments. - Financial intermediaries and international securities markets. - National and international money markets and institutions. - The fundamental nature and characteristics of the following classes of financial assets will be examined in terms of risk, return, valuation, marketability and performance evaluation. The appropriateness of each class in practical investment decision making is stressed together with the principle features of each market. Equities Characteristics: Risk, market features, performance. Valuation: Present value approach, earnings, dividends, assets. Fixed Interest Securities (including convertible and index-linked securities) Characteristics:Risk, market features, performance, types of fixed interest security. Valuation: Yields, term structure of interest rates. Cash Instruments Characteristics: Types of instrument, risk, market features. Valuation: Yield calculations in different cash instruments, money market yield curve. Options, warrants and futures contracts Each of these instruments will be introduced to the extent that students will be familiar with the key features of the products, their valuation and uses and the markets in which they are traded. Advanced usage for hedging/speculation etc. is dealt with in the second-year courses in Treasury and Portfolio Management. Currencies The effect of currency risk on return and local market risk, spot and forward exchange rates, swap points, triangular arbitrage, features of the forex market.
Continuous Assessment25% Examination Weight75%
Indicative Reading List
Course material is drawn from a number of different texts. Recommended reading includes: Cutherbertson, K. Quantitiative Financial Economics: Stocks, Bonds and Foreign Exchange, Wiley 1996 Solnik, B., International Investments, 3rd edition Addison Wesley 1991 Watsham, T. Options and Futures in International Portfolio Management Harman Hall 1992
Programme or List of Programmes
MITMSc in Investment and Treasury