MSc Finance

The module aims to equip students with the necessary tools to conduct independent empirical research in finance.

This includes:

• An in-depth look at the relevant research methodologies in empirical finance
• Training in programming and quantitative analysis
• Introduction to various data sources available at or through WBS.

Gain an in-depth understanding of basic probability and distribution theory, statistical estimation and inference, and econometric models with applications to finance. In particular, the module covers classical multivariate linear
regression models, models for limited dependent variables, panel data, and time-series modeling.

Explore the fundamental relationships between investors’ decision-making in the presence of uncertainty (“risk”) and the cross-sectional and inter-temporal properties of prices and returns of financial assets. This module lays down the theoretical and methodological foundations on which the more specialised finance modules are built.

The goal of this module is to equip you with the skills to apply state of the art ideas of modern Corporate Finance theory as well as the quantitative tools to solving the types of problems faced by CFOs and other business executives who must make investment, financing, risk management, and payout decisions taking account of flexibility and discretion under uncertainty, tax consequences, and financing effects.

You will also be able to trace the effects of considerations such as corporate and personal taxes, bankruptcy costs, information signaling, and conflicts of interest on investment decisions and on financial structure decisions. Finally, you will understand the use of option- pricing techniques in corporate finance to evaluate corporate securities and investment projects.

This module is closely linked with the parallel core module “Asset Pricing”. While the latter develops the theoretical framework to understand and analyse the trade-off between risk and return, this module focuses on the operationalization of this framework.

The module aims to provide you with an in-depth understanding of and key skills in:

• How to manage the trade-off between maximising expected return and minimising risk for portfolios of securities.
• valuation of bonds and equities, selection of securities and optimal portfolio strategies through time, and portfolio performance measurement and attribution
• Issues relating to the institutional details of trading in difference asset classes will also be discussed.

While the theoretical underpinnings will not be neglected, the emphasis of the course will be on implementation of the theory i.e. investment management in practice.

The module provides the tools for the empirical analysis of financial time series and their application. It aims to provide you with an understanding of:

• the theory and tools used in financial econometrics and the ability to carry out empirical analysis of financial time series using packages such as STATA or EVIEWS
• a range of empirical stylised facts drawn from the analysis of financial markets; the rates of efficiency, models of equity returns, the yield curve and exchange rates
• volatility and risk modelling.