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FINC 381: Investment Analysis

Prerequisite: FINC 331

Credit Hours: (3)

This course focuses on the theory and practice of investments, covering the topic areas of capital market structure, valuation, security analysis and portfolio management.  The course is designed to develop a theoretical framework for investing and to provide the student with practice in applying the framework to typical investment decision making.
 

Detailed Description of Course
• Financial Instruments
    o Direct versus Indirect Investing
    o Treasury and Federal Agency Securities
    o Corporate Securities
    o Municipal Securities
    o Mutual Funds
    o Closed-end Funds
    o Exchange Traded Funds
• Financial Markets
    o How Securities are Traded
    o Tax Environment
• Portfolio Theory and Management
    o Risk and Return
    o Diversification
    o Portfolio Optimization and Selection
• Asset Pricing
    o Capital Asset Pricing Model
    o Dividend Discount Model
    o Corporate Valuation Model
    o P/E Multiples
    o Other Asset Pricing Techniques
• Investment Strategies
    o Economic Analysis
    o Industry Analysis
    o Company Analysis
    o Technical Analysis
• Bond Analysis and Investment Strategies
    o Bond Valuation and Yield
    o Bond Price Volatility and Duration
    o Bond Investment Strategies
• Stock Options
    o Fundamentals of stock options
    o Advanced option strategies and considerations
    o Option Valuation

Detailed Description of Conduct of Course

This course is a combination of lecture, case presentation, and discussion.

Goals and Objectives of the Course

Having successfully completed the course the student will be able to:
• identify various investment instruments offered in the financial markets;
• identify various financial markets;
• describe strategies with long-, short-, and leveraged (margin)- investing;
• measure the risk/expected return of individual securities as well as a portfolio;
• construct an optimal portfolio given a set of financial assets;
• differentiate between technical and fundamental analyses in predicting the future performance of assets;
• apply fundamental analysis in predicting the future performance of assets; and
• recognize and implement option strategies for leveraged return and investment hedging applications.

Assessment Measures

Graded assignments may include in-class tests, a final examination, the assignment and presentation of problem exercises, papers, and class preparation and participation.

Other Course Information

None

Review and Approval
DATE ACTION APPROVED BY
February 2010 Reviewed Dr. Dan Davidson, Chair

03/2011