The aim of the course is to provide students with a thorough understanding of core concepts and methods of financial economics. The course will also offer an introduction to active areas of research in finance that students may consider for further study and independent research.
In particular, the course will focus on asset pricing and portfolio theory. The course is divided into two parts. The first part discusses models in which market participants have the same information. The second focuses on models where market participants can have different information. It also briefly discusses models of behavioural finance. In the first part, we will cover topics such as Arrow-Debreu securities, complete and incomplete markets, mean-variance analysis, capital asset pricing model (CAPM), arbitrage pricing theory (APT). In the second part, we will offer an introductory study of market microstructure, asymmetric information, rational expectations models, sequential trade models, market efficiency, no trade theorems and behavioural finance. We will discuss how these models can help us understand herd behavior, financial crises, booms and crashes.
Topics in Money and Finance
Module information video presented by Antonio Guarino
|Taught by:||Antonio Guarino|
|Assessment:||2 hours of lectures per week and 4 problem classes with written assignments. The course will be examined by a 2-hour written exam in Term 3.|
|Suitable for:||Graduate students|
|Prerequisites:||ECON0066 or ECON0093|