Postgraduate taught 

Quantitative Finance MSc

Investment, Finance and Asset Prices ECON5068

  • Academic Session: 2020-21
  • School: Adam Smith Business School
  • Credits: 20
  • Level: Level 5 (SCQF level 11)
  • Typically Offered: Semester 1
  • Available to Visiting Students: No
  • Available to Erasmus Students: No

Short Description

Investment variation in fixed capital and to some degree other productive assets (e.g. inventories) by companies is a key driving factor of economic cycles. This variation in investment typically goes hand in hand with variation in asset prices, as the new capital affects companies' valuation in bond and stock markets. Moreover, companies' investment policy depends on finance-its source, price and availability. The course provides a rigorous analysis of various theories of firm level investment with an emphasis on the relationship between the finance and investment decisions.

Timetable

Timetable: 10 weekly lectures in 2h blocks and 5 bi-weekly tutorials/computer labs in 1h blocks.

Excluded Courses

None

Co-requisites

None

Assessment

Students are assessed on the basis of a written take-home examination in March (25% of final grade for course) and a written examination in May (75% of final grade for course). For the take-home exam, students are given a 24-hour period in which to complete the exam. The paper consists of two compulsory questions, and is expected to take around 2-3 hours to complete. The final examination takes the form of a two-hour paper. Students will answer two questions out of a choice of four.

Main Assessment In: April/May

Course Aims

The course objectives are (a), to provide students a foundation in technical methods to be able to analyze problems of a dynamic nature, such as firm level investment and (b), to provide students all the relevant theories of investment in capital with an emphasis on the nexus between investment, finance and asset prices. In relation to (b) students will also be introduced to various empirical tests that seek to discriminate between alternative investment theories.

Intended Learning Outcomes of Course

By the end of this course students will be able to:

 

■ formulate economic dynamic problems in a logically coherent fashion

■ apply advanced technical and analytical methods to the solution of dynamic economic problems

■ demonstrate knowledge of alternative investment theories and explain how they are tested empirically

■ reason logically and work analytically

■ communicate effectively and clearly in written and oral form

Minimum Requirement for Award of Credits

Students must submit at least 75% by weight of the components (including examinations) of the course's summative assessment.