Student guide Facoltą di Economia A.A. 2010/11

Financial investment & pricing
Aim of the course
The course aims to provide the student with a theoretical and practical background in the field of securities instruments and related markets. It provides a description of the characteristics of the main financial instruments clarifying their risk return profile and the mechanics of the markets where they are traded. It also offers a preview of portfolio theory and asset pricing discussing how investors build their investment portfolios and how the main types of securities are priced. The course is intended for students who want to become a money manager, an investment professional or who just want to be a wise investor. Within a rigorous analytical framework, the course offers plenty of real world examples and favors the “hands on” approach.
The student should possess spreadsheet skills and a good working knowledge of college algebra and statistics as well as be familiar with the concepts of present value, future value and net present value.
1. The Investment Environment     
2. Asset Class                                               
3. How securities are traded                     
4. Mutual funds & Inv. Companies 
5. Yield structure                      
6. Bond Prices and Yields 
7. Equity valuation models 
8. How do investors choose?
9. How do investor choose ?
10. Optimal risky portfolios            
11. Simple pricing of risky assets
12. Options & Futures Markets 
The grades are determined by the performance on one long problem-set. Students must certify in writing that they fully complied with the LIUC Code of Honor (no cheating, no free riding, no shirking). Grades are revised upward or downward according to the result of a short closed book test to be taken in class to control for any opportunistic behavior.  
Reading list
Required: Investments, 7th (or 6th or 8th) Ed., Z. Bodie, A. Kane, A.J. Marcus, Irwin/McGraw. Previous edition may also be ok if “rationally” used.
Recommended: The Wall Street Journal, The Financial Times (Il Sole24ore, MF)