Postgraduate Courses
GFIN
Global Finance
- GFIN 5010Foundations of Investments[2-0-0:2]DescriptionThis course provides an introduction to modern asset pricing theory. We begin by briefly reviewing portfolio theory. We then move on to discussing current determinants of asset prices such as cash risk and liquidity. One of the course's goals is to apply asset pricing theories to investment decision-making. A second goal is to prepare students for upcoming courses. A third goal is to build a fundamental knowledge of fixed income and derivatives products.Intended Learning Outcomes
On successful completion of the course, students will be able to:
- 1.Apply the concept of duration and use various financial instruments to hedge the interest rate risk in a fixed-income portfolio.
- 2.Apply the concepts of diversification and use Markowitz portfolio selection model to search for an optimal risk-return profile for a risky portfolio.
- 3.Apply capital asset pricing model to earn risk-free profits from the identification of mispricing securities and to magnify profits from leverage.
- 4.Price different kinds of derivative securities and create synthetic financial instruments to achieve desired payoff structures.
- GFIN 5020Foundations of Corporate Finance[2-0-0:2]DescriptionThe aim of the course is to provide students with a comprehensive overview of the financing and investment decisions made by firms. It covers capital budgeting, dividend policy, financing policy and managerial incentives.Intended Learning Outcomes
On successful completion of the course, students will be able to:
- 1.Apply the concept of time value of money to measure the net present value in capital budgeting decisions.
- 2.Apply the method of discounted cash flow to value bonds and stocks.
- 3.Apply Modigliani-Miller theory and trade-off theory to optimize a firm’s debt-to-equity ratio in capital structure decisions.
- 4.Apply basic valuation techniques to estimate the value of projects and firms.
- 5.Apply valuation techniques to quantify the impact of strategic decisions on value creation.
- GFIN 5040Derivatives Markets[2-0-0:2]DescriptionThis is a course in derivatives markets: structure, valuation and strategies. It builds on the content of the course GFIN 5010 Foundations of Investments and combines theory, empirical findings and practical applications. The main applications include the equities, foreign exchange and commodities markets. The key derivatives instruments discussed include forwards, futures and options. Cases and examples include the 1987 crash, LTCM, Metallgesellschaft, Amaranth, etc.Intended Learning Outcomes
On successful completion of the course, students will be able to:
- 1.Apply cost-of-carry model to price forward contracts and futures contracts.
- 2.Use forward contracts and future contracts to hedge enterprise risk.
- 3.Apply the binomial model and the Black-Scholes-Merton model to price options.
- 4.Measure, manage and hedge the risk exposure in an option position.
- 5.Manage risk exposure in structured products and use volatility derivatives to manage portfolio risk.
- GFIN 5050Applied Corporate Finance and Valuation[2-0-0:2]DescriptionThis course focuses on the valuation of companies and the creation of shareholder value by looking at the interplay of corporate strategy and finance. The course exposes participants to valuation frameworks that can readily be applied to improve business and strategic decision-making.Intended Learning Outcomes
On successful completion of the course, students will be able to:
- 1.Illustrate how firms create value by restructuring debt, managing financial distress, and determining optimal leverage.
- 2.Measure value of assets and liabilities by applying direct valuation methods such as discounted cash flow analysis.
- 3.Measure value of assets by applying relative valuation methods such as comparable companies analysis.
- 4.Quantify the impact of decisions to restructure assets on firm value.
- 5.Identify sources of value creation in mergers and acquisitions and decide on the method of payments.
- GFIN 5080Fixed Income Instruments and Markets[2-0-0:2]DescriptionThe course addresses fixed income financial instruments and their derivatives, covering the types of debt instruments, interest rate structures and building the yield curve, the valuation of debt securities, debt default and related topics. There is also consideration of fixed income instruments in portfolio strategies, as well as the role of financial structures, options and derivatives such as credit default swaps.Intended Learning Outcomes
On successful completion of the course, students will be able to:
- 1.Analyze the interconnected roles of the markets for bonds, swaps, repos, fixed income options, and mortgage-backed securities in the global financial system.
- 2.Derive the term structure of zero rates, forward rates, annuity rates, and prices of any securities with fixed cash flow from the yields of newly issued government coupon bonds or swap rates.
- 3.Apply the concepts of duration and convexity to measure and manage interest rate risk of fixed income portfolios.
- 4.Construct an interest rate model to price and manage risk of fixed income derivatives, callable bonds, and mortgage-backed securities.
- GFIN 5090Risk Management in Financial Institutions[2-0-0:2]DescriptionThe course covers the state-of-the-art and new developments in major areas of risk management in financial institutions and business firms in general - credit risk, market risk, liquidity risk, operational risk, sovereign risk, strategic risk, and reputational risk. Emphasis is placed on risk integration.Intended Learning Outcomes
On successful completion of the course, students will be able to:
- 1.Identify national and global financial architectures, creating a lens that can be used to interpret and analyze changes in financial technologies, the regulatory environment, and strategic and tactical initiatives of individual competitors.
- 2.Evaluate systemic risks and weaknesses in the global financial architecture that can trigger serious losses and systemic damage associated with financial crises.
- 3.Assess the “classic” forms of risk facing financial firms – market risk (including foreign exchange risk), credit risk and liquidity risk, and the metrics and tools available to analyze and address each of them, including inter-risk linkages such as market risk hedging that gives rise to counterparty credit risk, and the key role of liquidity.
- 4.Discuss the more difficult risk domains, notably operational risk including cyber risk, sovereign risk and reputational risk – where risk metrics are less easily and reliable calibrated, and focus on best practice in the financial industry in addressing such complex risks.
- 5.Integrate systemic risk and the six functional risk domains into a composite view of enterprise risk by superimposing the risk contours onto a financial firm’s competitive profile.
- GFIN 5100Financial Markets and Corporate Finance in China[2-0-0:2]DescriptionThis course provides an overview of China's financial markets, the reform of financial institutions and corporate risk management. Students will gain an understanding of the recent developments in financial services and corporate practices in China.Intended Learning Outcomes
On successful completion of the course, students will be able to:
- 1.Interpret macroeconomic releases issued by the Chinese Government.
- 2.Assess the impact of macroeconomic releases on business opportunities in China.
- 3.Identify investment opportunities and risks of domestic and foreign investments in China.
- 4.Identify capital sources such as informal banking and private equity in China.
- GFIN 5200Global Macro & Asian Markets[2-0-0:2]DescriptionThis course introduces students to macroeconomic forces that affect global and Asian financial markets. Students will discuss various global macroeconomic concepts, the influences of global finance on long-run economic growth, and the structure/size of foreign exchange markets. This course will also cover recent developments in global/Asian financial markets, macroeconomics in a post-crises world, and exchange rates.Intended Learning Outcomes
On successful completion of the course, students will be able to:
- 1.Discuss key macroeconomic indicators including gross domestic product, employment and unemployment, inflation, balance of payments, and the level and growth rate of productivity.
- 2.Evaluate macroeconomic performance using key concepts such as real GDP, aggregate demand, Phillips curve, growth accounting, and total factor productivity.
- 3.Apply concepts such as covered interest rate parity, uncovered interest rate parity, purchasing power parity, international price competitiveness, and real exchange rates to explain the developments in foreign exchange markets.
- 4.Analyze the roles and effects of government fiscal, monetary, and foreign exchange policies as influences on national and global macroeconomic performance.
- 5.Examine contemporaneous domestic and global challenges in the realms of financial markets and financial investments facing China and other Asian economies.
- GFIN 5300FinTech[1-0-0:1]DescriptionThe course will introduce the current state of FinTech and discuss how financial institutions and their stakeholders are being affected by new technologies. Students will understand how traditional business models are being impacted by the application of new technologies and how financial innovation impacts money and payment systems. The course offers a combination of case studies, lectures, and guest speaker sessions, and will identify current trends and opportunities within the FinTech ecosystem.Intended Learning Outcomes
On successful completion of the course, students will be able to:
- 1.Describe the FinTech ecosystem and its impact on global financial market.
- 2.Identify opportunities and threats that FinTech disruptions may bring to the financial market.
- 3.Discuss how disruptive technologies can be applied to real-life finance issues and investment strategies.
- 4.Identify the privacy and regulatory challenges that FinTech presents for risk management in the financial industry.
- GFIN 5400Asset Allocation[1-0-0:1]Exclusion(s)GFIN 5030 (Prior to 2019-20)DescriptionThe course builds on GFIN 5010 Foundations of Investments to provide students with tools and knowledge in global asset allocation. Topics include major investable markets and players, asset allocation, performance evaluation, strategies and performance of hedge funds, and factor models.Intended Learning Outcomes
On successful completion of the course, students will be able to:
- 1.Apply strategic asset allocation and tactical asset allocation to select the optimal asset allocation.
- 2.Determine asset allocation by using factor models to optimize the factor structure and to improve portfolio performance.
- 3.Manage risk of a portfolio using derivative securities and calculate the optimal hedge ratio.
- 4.Evaluate the performance of a portfolio in terms of measurement of returns, attribute return differences to investment decisions.
- GFIN 5500Behavioral Finance[1-0-0:1]Exclusion(s)FINA 5420 (prior to 2020-21)DescriptionA growing strand of research suggests that the standard economic paradigm - rational investors in an efficient market - does not adequately describe behavior in financial markets. Behavioral finance combines the latest findings of behavioral and cognitive psychological theory with conventional economics and finance to provide alternative explanations of financial market behavior. We will examine how psychology of decision making under conditions of risk and uncertainty affects the traditional paradigm, while paying attention to practical applications for portfolio and investment management.Intended Learning Outcomes
On successful completion of the course, students will be able to:
- 1.Identify the differences between traditional finance and behavioral finance frameworks.
- 2.Apply the technical tools required to analyze issues in behavioral finance.
- 3.Illustrate the psychological concepts in financial markets and financial decision-making.
- 4.Compare and contrast the behavioral and non-behavioral explanations of outcomes in financial markets.
- GFIN 6010Topics in Financial Markets and Governance[1-0-0:1]DescriptionA capstone course covering advanced topics in finance, the selection of which will depend on market developments and students' interest. The course builds on material covered in the other courses in the program, and is taught at the research-driven frontier.Intended Learning Outcomes
On successful completion of the course, students will be able to:
- 1.Identify connections between various corporate governance provisions and shareholder value.
- 2.Make intelligent investment decisions regarding highly risky entrepreneurial ventures and buyouts.
- 3.Structure investments with a view to incentivize and motivate the entrepreneur or CEO while minimizing the investor’s downside risk.
- 4.Apply the concepts of financial engineering and measure the effect of credit derivatives trading on the underlying firms.
- GFIN 6980Integrative Project in Global Finance[4 credits]DescriptionThe aim of the project is to enable students to apply what they have learned in each course unit and to draw on their practical experience in the global banking and financial markets. Students are assigned to work in groups on a team project throughout the year and will culminate with a presentation to a panel of faculty.Intended Learning Outcomes
On successful completion of the course, students will be able to:
- 1.Apply critical thinking to identify and analyze a suitable topic.
- 2.Use relevant financial knowledge and skills assimilated throughout the program to evaluate or propose solutions to real-life finance issues.
- 3.Conduct research, perform analysis and recommend solutions/proposals to contemporary finance issues using scientific research methods.
- 4.Collaborate and communicate effectively with team members of diverse backgrounds.
- 5.Present findings and proposals on current finance issues in the form of written report and verbal presentation.
