FINANCIAL MARKET - QUALIFICATION
Learning outcomes of the course unit
The first part of the course aims to examine the principles which should guide the investment choices, the evaluation criteria and the operational techniques. The analysis concerns bonds, equities and financial derivatives.
Finally, in the second part, the course will examine the principles which should guide the choices of composition and management of financial portfolios. At the end of the course, students will have acquired:
a. the knowledge necessary to understand the technical characteristics of financial instruments and techniques for the management and evaluation of a financial portfolio;
b. the ability to apply the acquired knowledge to critically analyze the financial instruments and make aware investment choices that are consistent with the needs of a potential investor;
c. the critical capacity (independent judgment) to evaluate independently the problems associated with financial investment analysis and selection;
d. the ability to use a consistent technical language appropriate to communicate with financial market operators, such as private bankers and, more generally, financial advisors;
e. the ability to learn through a logical method, which consists of identifying the problems and critical analyzing the adopted solutions.
Course contents summary
• Financial markets and securities intermediaries: institutional and regulatory principles
• The primary market
• The organization and functioning of the secondary market
• The analysis of investments in fixed-coupon bonds
• The term structure: theoretical elements, measurement methods and interest rate forecast
• Corporate bonds
• The analysis of equity investments: principles of fundamental analysis
• Financial investment analysis. The Technical Analysis
• The Markowitz's Portfolio Selection Theory
• The Capital Asset Pricing Model
• Management strategies of equity and bond portfolios: the extension of risk and performance indicators from the single security to portfolio
• Benchmarks: Functions and main characteristics.
• The active and passive portfolio management.
• Performance evaluation: the measurement of performance and risk.
• Risk-adjusted performance indicators
• Portfolio hedging techniques using futures
• Portfolio hedging techniques using options
• The analysis of management styles.
Gandolfi G., Scelta e gestione degli investimenti finanziari, Bancaria Editrice, Roma, 2009.
Knowledge and understanding: lectures
• Applying knowledge and understanding: exercises
• Making judgements: during this module, students will be encouraged to identify strengths and weaknesses of financial instruments and intermediation models
• Learning skills: each topic will be addressed first, explaining the problem to be solved, and then critically analyzing the adopted solutions
• Communication skills: the teacher will illustrate the meaning of the most common terms used by the financial community.
Assessment methods and criteria
Written or oral test (chosen by the student).
The final score relative to the course is equal to 30/30 and will be calculated as follows:
The knowledge will be tested with 2 closed-ended questions, that will be assessed up to 2 points each
The ability to apply knowledge will be verified with 1 exercise, that will be assessed up to 8 points
The ability to communicate with technical language will be tested through 2 closed-ended questions about the meaning of terms used by financial market experts, that will be assessed up to 2 points each
The autonomy of judgment and the ability to learn will be verified with 2 open-ended questions, that will be evaluated up to 7 points each.