Finance and Investment with a Year in Industry - BSc (Hons)

This module will cover the key concepts of microeconomics and theories related to the individual, firm and industry in the short and long run, underpinned by existing evidence on past and current economic trends in the UK, Europe and the rest of the world.

• Key microeconomic concepts such as opportunity cost and equity versus efficiency

• Supply and demand; elasticity

• Cost and revenues

• Profit maximisation under different market structures

• Input markets; labour and capital

The aim of this module is to give students a solid grounding in key statistical techniques required to analyse effectively business data and data relevant for business. Indicative content:

• Maths and statistical skills for business; revision of algebra and basic mathematical functions.

• Summarising data with histograms, bar charts, frequency distributions, measures of central tendency and dispersion.

• Spreadsheets: features and functions of commonly-used spreadsheet software including: workbook, worksheet, rows, columns, cells, data, text, formulae, formatting, printing, , charts and graphs, data management facilities,

• Probability: The relationship between probability, proportion and percent, addition and multiplication rules in probability theory and Venn diagrams.

• Common Probability Density Functions.

• Sampling and its use in inference, and applications of sampling in business management.

• Regression and correlation: scatter plots; simple regression; interpreting computer output.

• Forecasting using spreadsheets.

• Hypothesis testing using z-scores and t-scores

• Simulations- random number generation

This module builds on knowledge gained from CB367: Introduction to Data Analysis and Statistics for Business. The module is designed to provide a sound mathematical and statistical foundation for studying finance. Students will learn the key mathematical and statistical tools necessary to analyse effectively financial data.

Topics covered include:

• Basics: algebra, linear equations

• Solving simultaneous linear equations

• Rates of change and Differentiation

• Optimization (minimisation-maximisation)

• Introduction to matrix algebra

• The classical simple and multiple linear regression model (estimation – inference)

This module begins by looking at the role of investments and finance in an organisational context. It then considers the role of financial markets and the links between investors and businesses. Students will learn different investment appraisal techniques used in capital budgeting decisions, such as NPV and IRR. The module also covers the basics of any investment decision, such as the relation between return and risk. In the second part of the module, student will learn about short and long term sources (i.e. capital structure) of finance available to businesses and how to determine the cost and value of each source of long-term finance.

Topics covered include:

- Short-term and long term investment appraisal and capital budgeting techniques

- Estimation of return and risk in the context of portfolio theory

- Short-term finance and working capital management

- Long-term finance and the cost of each source of finance

- Capital structure and weighted average cost of capital

- Interaction of investment and financing decisions

This module introduces students to different financial markets and their role in the economy. These markets include equity, bond/debt/interest rate, foreign exchange and derivative markets. In this module, students will also learn about the trading instruments used in these markets. Moreover, the module offers an exploration of current developments in the world's financial markets and institutions, including innovation, globalization, and deregulation, with a focus on the actual practices of financial institutions, investors, and financial instruments.

Topics covered include:

• The development of financial markets and instruments and their role in the economy

• Money, interest and bond markets and their major instruments

• Equity markets, their functions and instruments

• Derivative markets and their instruments

• Foreign exchange markets

The module will cover various aspects of the changing international business environment, and their impact upon business operations and strategy. It will give students an appreciation of the business difficulties faced; the variety of factors influencing the choices and compromises that have to be made in international businesses, and the implications of those for the future viability and effectiveness of the organisations concerned.

An list of topics is given below:

• Globalisation: Definition, Evolution, Implications for countries, firms and people

• The International Business Environment: World Institutions, Patterns of International Trade and FDI Activities

• The Triad: European Union, United States, Japan - Investment, Trade, Relations

• Developing and Emerging Economies: Opportunities and Challenges

• Cultural Frameworks for International Business

• Entry Modes: Theory and Practice

• Internationalisation Theories

• International Expansion Strategies

• International Stakeholders – Ethical Issues

This module aims to give students a better understanding of the importance of accounting in the modern world and how accounts are produced and regulated to produce meaningful information for all internal and external stakeholders.

This module provides fundamental knowledge of a range of business organisations, business purpose, ownership types and stakeholder influence. It further introduces organisational structures, functional areas and the impact of the external environment on business. Furthermore, this module introduces the many factors that shape the nature of organisations operating in an increasingly complex business environment such as innovation, internationalisation, entrepreneurship, and sustainability. Module participants explore this dynamic nature of business and consider successful existence within modern organisations through studying and applying employability skills such as leadership, teamwork, and resilience.

This module advances the topics learnt in Fundamentals of Finance and Investments. In this framework, the module considers the impact of inflation, capital rationing, and taxation in capital budgeting decisions along with the understanding and use of sensitivity analysis in the context of risk in project appraisal. It then proceeds to introduce risk free asset in portfolio formation and concludes with learning about Capital Asset Pricing Model. Students also learn about the impact of taxes on capital structure and weighted average cost of capital. The module also covers another (in addition to investment and financing decisions) major financial management decision, that is, the dividend policy of the firm. Finally, the students also learn about mergers and acquisitions in the context of corporate restructuring. In sum, this module aims to cover the following topics:

- Impact of inflation, capital rationing and taxation on investment appraisal and capital budgeting techniques

- Risk free rate, portfolio theory, and Capital Asset Pricing Model

- Impact of taxes on costs of different sources of finance

- Capital structure and weighted average cost of capital in the presence of taxes

- Dividend based valuation and factors affecting dividend decision

- Mergers and acquisitions

This module is concerned with derivative securities used by the investors for hedging (risk management), speculation and arbitrage purposes. In this module students learn about various derivative instruments such as forwards, futures and options contracts on a range of different underlying assets. These underlying assets could be physical assets such as commodities (gold, oil, etc.) or financial securities (currencies, stocks, etc.). Students also learn about how these derivative instruments are valued. The main focus behind the use of these derivatives would be from risk management perspective. More specifically, this module aims to cover the following topics:

- Types of derivative instruments and their characteristics

- Forward contracts and their valuation

- Futures contracts and their valuation

- Options contracts and their valuation

- Uses of derivatives in portfolio management

The module aims to give students a solid understanding of the basic econometric tools that are often used in the empirical finance literature. The module also develops the IT skills of the students so that students are able to implement sophisticated statistical techniques to model, analyse and forecast financial data by means of Eviews (econometric software). Students will also improve their ability to critically evaluate the use of econometrics in the academic finance literature.

Topics covered include:

• Dummy variables in linear regression models

• Time series models (ARIMA models)

• Forecasting

• Unit root tests

• Simulation analysis

The module aims to provide students with a thorough understanding of the financial accounting techniques at an advanced level and gain an appreciation of the regulatory and social environment within which financial reporting takes place. They will also be able to analyse corporate financial statement information and to make performance evaluations and investment decisions.

Topics covered include:

• Conceptual framework of financial reporting

• Financial Reporting environment

• Off Balance sheet financing

• Group Accounting

• Ratio analysis

• Economics of valuation and valuation models

• Financial reporting model

In the wake of the largest economic crisis in recent times many causes have been proposed for the turmoil. At the centre of the argument is banks' excessive risk-taking behaviour, especially through abundant lending, over-leveraging and dramatic expansion in the usage of credit transfer products in the years leading up to the crisis. On the policy side, incompetence of regulators overseeing the banking system is voiced. Therefore, understanding the banking business and regulation from an international perspective is of paramount importance to prevent future economic crises that may be caused by banks. In this perspective, the module examines the different types of banks, their financial features and risk in banking. It introduces several international banking activities that link national financial markets globally. Particular focus is placed on the importance of regulation from an international perspective through Basel accords.

Topics covered in this module include:

• Introduction to financial intermediation

• Activities of International Banks and relationship banking

• Banks’ balance sheet and income statement

• Perceptions of the global banking before/after 2007/08 financial crisis

• Income structure and balance sheet of banks and bank risks: Retail vs. Investment banks

• International activities of banks: Syndicated lending and asset securitisation

• Bank regulation and supervision: Basel I, II and III

• The 2007/2008 global banking crisis: Causes, the aftermath and implications for banks and regulators

The module will introduce students to the investment environment providing an explanation of the major types of markets in which the securities trade, the trading process and the main players in these markets. It will then follow with a detailed discussion of asset classes, such as stocks, bonds, real estate, commodities and so on. The module will also include a discussion on the asset pricing theories (capital asset pricing model, arbitrage pricing theory and multifactor models). It will mainly focus on the valuation techniques of financial securities, in particular stocks, bonds, and derivative contracts. The module will also introduce students to the CFA Institute Code of Ethics and Standards of Professional Conduct.

Topics to be included in this module are as follows:

- Investment Environment

- Asset classes and financial instruments

- Trading of Securities

- CFA Institute Code of Ethics and Standards of Professional Conduct

- Review of Equilibrium in Capital Markets (Capital Asset Pricing Model, Efficient Market Hypothesis, Arbitrage Pricing Theory, Multifactor models)

- Technical and Fundamental Analysis

- Security Analysis: Macroeconomic and industry analysis

- Equity Valuation Models

- Financial Statement Analysis

- Bond prices and yields

- Term structure of interest rates

- Derivative contracts

This module will cover the core principles of macroeconomics; including the measurement of key macroeconomic variables and limitations to existing practices. Students will consider competing theories related to the macro economy in the short and long run and their overall consequences for the business environment. This will be underpinned by existing evidence on past and current levels of macroeconomic indicators in the UK, Europe and the rest of the world. Indicative topics are:

• The Macro economy – as a system: the circular flow (including injections and withdrawals), national income measurement, economic growth and international comparisons

• Macroeconomic variables: GDP, unemployment, inflation, money supply and balance of payments

• The open macro economy; including imports and exports; the role of exchange rates and trade theory.

• Macroeconomic theories: including the classical approach, the Keynesian demand management approach and monetarism

• Macroeconomic policies: demand versus supply side economic management

The aim of the module is to develop an understanding of corporate social responsibility (CSR) and sustainability informed by ethical theory and stakeholder perspectives. Students will have the opportunity to familiarise with essential readings and cases in CSR to enable them to recognise key issues raised by stakeholder groups. such as shareholder activism; socially responsible investment; employee discrimination; working conditions; ethical issues in marketing; management; consumer protection; gifts/ bribes; accountability; collaboration with civil society organisations, and corruption of governmental actors. The module will therefore contribute in building an understanding of contemporary social issues in business by highlighting the importance of a collaborative approach with internal and external stakeholder groups.

Indicative topics are:

- Business Ethics

- Corporate Social Responsibility

- Sustainability

- Social responsibilities of sectors and industries

- Stakeholders of organisations, including:

Employees

Suppliers

Competitors

Shareholders

Civil society

Government

- Implementation of socially responsible and sustainable programmes and initiatives

The Year in Industry experience provides you with a structured opportunity to combine work experience or entrepreneurial activity with academic study.

The Year in Industry allows students to develop and reflect on managerial and/or professional practice in real and often complex situations, and to integrate this with the study of the relevant subject(s) of your main degree programme.

Where relevant, students develop, reinforce and apply professional and/or technical expertise in an employment or entrepreneurial context. The placement portfolio requires students to document their experiences in relation to both their university studies as well as to a wide range of employability skills.

In addition, the portfolio allows demonstration of professional development through the collection and presentation of relevant evidence.

To be able to undertake this module it is necessary for the student to secure a placement or to have validated a Business Start-Up during Stage 2.

The Business Start-Up should build on the student's planned business activity as developed and validated by the ASPIRE Business Start-Up Journey.

The particular combination of the student’s degree programme and choice of modules together with the great variety of increasingly diverse Year in Industry situations make the "curriculum" of the Year in Industry essentially unique.

This module documents and assesses the evidence of Year in Industry learning being achieved.

The module begins with motivations for risk management in general and then covers the practice of risk management. In particular, students are introduced to the current thinking on governance and regulatory systems, followed by industry practices for managing certain common types of risk. Critical evaluation of these practices is incorporated where applicable.

Topics covered in this module include:

- Introduction to general risk management theory, how and why it generates value

- A taxonomy of risks, including Market Risk, Credit Risk, Liquidity Risk, Operational Risk, Model Risk, Regulatory Risk, Legal/Contract Risk, Tax Risk, Accounting Risk, and Political Risk.

- Introduction to Governance and Regulation

- Standard measures of risk

- Risk measurement for security portfolios

- Hedging techniques using financial derivatives

- Evaluation of hedging performance

The curriculum considers the alternative investment techniques available in the global financial markets. Portfolio analyses will be extended to include focuses on commodities, real estate, private equity and hedge funds. The module will include an investigation of the underlying rationale for such investment types as well as providing an understanding of the construction and management of relevant strategies.

The syllabus will typically cover:

• Introduction to Alternative Investments and their characteristics

• Hedge Fund Strategies

• Investing in Commodities

• Real Estate investment instruments

• Private Equity / Venture Capital Valuation

• Formulation and implementation of various active and passive investment strategies, as well as the analysis and management of risks associated with particular strategies.

The world of fixed-income markets is becoming increasingly more complex with debt instruments that have varied payoffs structures and fixed-income derivatives that are growing in size and complexity. As a result of the 2007-2008 global financial crisis many key players in the fixed-income markets either collapsed (Bears Stearns and Lehman Brothers), or were bailed out by governments (Freddie Mac, Fannie Mae, the Royal Bank of Scotland, Lloyds TSB, and HBOS, etc.). Hence, the aim of this module is to provide an introduction of the complex nature of fixed-income markets and securities and a discussion on the forces affecting prices and risks of such instruments. The module will also include a discussion on the appropriate management techniques to hedge the risks associated with fixed-income instruments.

This module will cover the following topics:

- Features of debt instruments and risks associated with investing in these instruments.

- Debt and money markets (participants, operations, trading activities).

- Fixed-income instruments (Government bonds, corporate bonds, credit ratings, high-yield bonds, international bonds, mortgage-backed securities, etc.).

- Money market instruments (Treasury bills, commercial paper, repurchase agreements, bills of exchange, etc.).

- Fixed-income valuation (traditional approach, arbitrage-free approach, yield measures, volatility measures).

- Term-structure of interest rates and classic theories of term structure, derivation of zero-coupon yield curve.

- General principles of credit analysis (credit scoring, credit risk modelling, etc.).

- Fixed-income portfolio construction and management strategies (portfolio's risk profile, managing funds against a bond market index).

This module provides students a solid foundation on key topics of portfolio management, which covers various categories of portfolios and constructing portfolios targeting given objectives. The content includes:

• The Investment Policy Statement

• Modern Portfolio Management Concepts, Asset Classes, and International Diversification

• Management of Individual/Family Investor Portfolios

• Management of Institutional Investor Portfolios

• Economic Analysis, Setting Capital Market Expectations, and Industry Analysis

• Asset Allocation, Risk Aversion and Optimal Risky Portfolios

• Portfolio Construction and Revision, Portfolio Theory and Practice

• Performance Evaluation of Portfolio Management

The law affects the commercial world in many ways. This module focuses on how businesses fulfil their legal obligations to customers, suppliers and their workforce. As well as exploring how businesses are structured and the duties on directors and partners it also considers the legal obligations individuals and organisations have over those to whom they have a duty of care. The module further covers the main laws governing the employment of staff and contractors. By applying the law to real-world business situations students are able to fine-tune their problem solving skills and their ability to construct well-reasoned and persuasive arguments.

The module covers the following topic areas:

• The English Legal System, Legal Process and Dispute Resolution;

• Law of Negligence – including general principles and negligent mis-statement

• Law of Business Organisations - classification of business organisations; main principles applying to general and limited liability partnerships and registered companies, and directors' duties

• Employment Law - the general scope of the legal obligations owed by employers to employees, including the employment contract, discrimination and dismissal

The law affects the commercial world in many ways. This module focuses on the importance of law in governing transactions between individuals and businesses; what is required for legally compliant contracts; what the law expects of organisations in terms of protecting the consumer, and how businesses manage and avoid disputes. By enabling students to become familiar with those parts of the law they are most likely to encounter in their careers and in business the module helps them better understand the obligations that parties have to each other in law.

Indicative topic areas are:

• The English Legal System

• The Legal Process and Dispute Resolution

• Law of Contract – including:

• Formation

• Contract terms

• Vitiating elements, such as misrepresentation and economic duress

• Performance and discharge of contract, including frustration

• Common law and equitable remedies, including damages

• Consumer Protection

A synopsis of the curriculum

• Introduction to Business/Management Projects

• Research Methodologies

• Literature search and Literature Review

• Data collection and questionnaire

• Structuring a Project Report

• Data Analysis

• Presentations