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MSING028: INVESTMENT MANAGEMENT
Core Module Information:
MSc Management Route B, Finance pathway & MSI PGT affiliate only
2-hour lecture (x 10 weeks) and 1-hour seminar (x 9 weeks)
60% unseen 2-hour examination; 40% coursework
The purpose of this module is to provide students with a theoretical and practical understanding of the principles of investment management in the current and future environments.
We will study the essence of the decision-making and subsequent management processes relating to informed investment decisions concerning stocks, bonds, mutual funds, and other investment securities. We will consider the nature of these investment assets and the management of their relative places within a portfolio. We will also explore the valuation and risk issues and management aspects of commodities as well as derivatives and futures.
To establish a base level of understanding of financial concepts, this module will make use of a required text. However, we will also cover readings from relevant case studies. As the financial industry is dynamic and constantly changing, rather than recommend specific investment strategies in specific circumstances, this module will equip managers with the skills to consider new investment strategies as new circumstances arise.
By successful completion of the module, students should be able to:
- Understand the structure, operation, and regulation of securities markets.
- Understand the nature of the risk/return trade-off and analyse its impact and treatment within the investment management framework.
- Understand and discuss portfolio objectives and the significance of the roles of betas, standard deviations, and the capital asset pricing model (CAPM).
- Understand, assess, and apply the principles of investment management in the context of ordinary shares (common stocks), with particular emphasis on stock valuation.
- Explain the attributes of bonds as fixed-income securities and issues in their valuation and pricing, with particular emphasis on yields and volatility.
- Understand issues in portfolio management, asset allocation, and portfolio returns.
- Understand the nature and characteristics of mutual funds, issues in their valuation and management, and their roles within portfolio investments.
- Apply appropriate investment management principles to derivatives, commodities, and financial futures.
- The investment environment
- Theoretical assumptions in investing
- Quantifying risk and return
- Fundamental valuation of companies
- Stock price analysis
- Fixed-income securities and bond valuation
- Mutual funds
- Portfolio management
- Options: calls and puts
60% is awarded on the basis of your examination result in an unseen, 2-hour paper in the Summer Term. 40% is awarded for coursework comprising a 3,000-word group report (20%) and a group presentation (20%).
Gitman, L., Joehnk, M.D., and Smart, S.B. (2011). Fundamentals of Investing. 11th ed. International ed. Harlow, England: Pearson Education Inc.