Seminar International Finance IMM

Course Objectives Understanding Financial Markets; Defining the Risk of Price Change in Asset Markets and Understanding the Theoretical Underpinnings thereof; Understanding the Idea of Hedging and the Application of Hedging Instruments; Digression: Defining and Managing Credit Risk Contents of the course 1. Basic Concepts of Financial Markets 1.1 The Functions of Capital Markets 1.2 The Structure of Capital Markets 1.3 Interest Rates 1.4 Assets and -Return Profiles 1.5 Financial Instruments 1.6 Globalization of Financial Markets 1.7 Efficiency and Inefficiency of Capital Markets 1.8 Sources Of Instability of Financial Markets 1.9 Risk Management 1.10 Motives for Engaging in Capital Markets Why are employees important? 2. Elements of Portfolio Theory 2.1 Striving for an Optimal Structure of Assets 2.2 The Central Role of Risk and Return 2.3 Covariance of Asset Returns and the Gains from Diversification 2.4 Three Steps to Portfolio Selection 2.5 The Portfolio Selection Model of Harry ;. Markowitz: A Critique 3. Elements of Capital Asset Pricing Theory 3.1 The Scope of Capital Asset Pricing Models 3.2 Elements of the Standard Capital Assedt Pricing Model (CAPM) 4. The Hedging of Systematic Risk through Derivatives 4.1 Basic Motives Behind Financial Market Transactions 4.2 Derivative Hedging Instruments 5. Digression: Defining and Managing Credit Risk 1. Stöttner, R.: Managing Financial Risk with Derivate Instruments, mimeo, Kassel 2008. 2. Eckl, S., Robertson, J.N., Thomas, D.C: Financial Engineering, A Handbook of Derivative Products, B. Blackwell, Oxford 1990. 3. Hull, John C.: Options, Futures and Other Derivatives, seventh edition, Prentice Hall, Upper Saddle River, New Jersey, 2008. LeistungsnachweisWritten examination in class (90 minutes) OR paper & presentation FB 07 Wirtschaftswissenschaften Uni Kassel SS 2008 Wirtschaftswissenschaften Univ-Prof. Stöttner Rainer