EASTERN MEDITERRANEAN UNIVERSITY
FACULTY OF BUSINESS AND ECONOMICS
DEPARTMENT OF BANKING AND FINANCE
SPRING 2009-2010
FINA425
Investments
Area Core
LECTURER
CREDIT VALUE
Assoc.Prof.Dr. Cahit Adaoğlu
3 Credit Hrs.
ECTS VALUE
PREREQUISITES
I expect that everybody is familiar with basic financial concepts (FINA301) and knows how to use a
financial calculator. We will be using the financial calculator extensively.
COREQUISITES
DURATION OF COURSE
None
One Semester (15 weeks)
ROOM AND TEL. NO.
BE 261 (FBE Building II), 630 2116 or 630 1475 (Secretary)
Mondays 15.30-16.20/Wednesdays 10.20-12.20 or feel free to contact for an appointment at other
times e-mail: cahit.adaoglu@emu.edu.tr
Ms. Inidi Hafizi, BE144 (FBE Building II) 630 2494, e-mail: inidi2005hafizi@yahoo.com
http://www.emu.edu.tr/~cadaoglu (Instructor Web Link)
Visit htttp://www.mhhe.com/bkm and click on Essentials of Investments 7th edition (Textbook Web
Link)
OFFICE HOURS
TUTORIAL ASSISTANT
WEB LINKS
COURSE LEVEL
1st Semester / 4th Year (Undergraduate Course)
COURSE CODE
COURSE TITLE
COURSE TYPE
6
CATALOGUE DESCRIPTION /AIMS & OBJECTIVES
The last decade has been one of rapid, profound, and ongoing change in the investment industry. The main objective of the course is to give
students an introductory understanding of capital markets and financial instruments. We will focus on three modules which are equity markets,
fixed income markets, and derivative markets (options and futures).
GENERAL LEARNING OUTCOMES (COMPETENCES)
On successful completion of this course, all students will have developed knowledge and understanding of:
Elements of Investments
Security Analysis
Fixed-Income Securities
Derivative Assets
On successful completion of this course, all students will have developed their skills in:
Identifying major participants in financial markets and global financial instruments with recent trends
How securities are traded
Understanding the risk-return tradeoff
Investment analysis using the practical applications of investment theory
Equity Valuation and Bond pricing
The use of options and futures
On successful completion of this course, all students will have developed their appreciation of and respect for values and attitudes regarding
the issues of:
Investment analysis and security valuation
The complexities and required skills in finance
The importance of investments as a core personal skill in their future careers
RELATIONSHIP WITH OTHER COURSES
This course lays the foundation for all other finance related courses and must be taken by students interested in finance
LEARNING / TEACHING METHOD AND ASSIGNMENTS
Class sessions will be devoted to the discussion of readings, chapter assignments and video presentations. In order for everyone to derive the
maximum benefit from the classes, it is important to do the assigned reading and chapter problems before the class. The only way to master this
material is by solving problems. Written work for the course will consist of chapter problems, a midterm and a final exam.
METHOD OF ASSESSMENT
Midterm exam
40%
Final exam
40%
Quizzes
15%
Class Participation
5%
If you do experience difficulty in this course, please contact me as soon as you sense you are having trouble. I will be glad to help you.
ATTENDANCE
Attendance is compulsory. Students are strongly advised not to miss lecture hours since success is closely related with attendance. Unexcused
absence for more than twelve lecture hours will result in grade "F." If the unexcused absence is on a continual basis, the ‘ NG’ grade will be
given.
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TEXTBOOK/S
Bodie, Z., A. Kane, & A. J. Marcus. Essentials of Investments, 7th edition, Irwin McGraw-Hill, 2008.
INDICATIVE BASIC READING LIST
I strongly recommend that you regularly follow daily financial newspapers such as Dünya (in Turkish) and The Wall Street Journal Europe or
The Financial Times.
EXTENDED READING LIST
NONE
SEMESTER(S) OFFERRED
2009-2010 Fall & Spring Semesters
CONTENT & SCHEDULE
Lectures will be held on Tuesdays (09.30-11.20/BEA3) and Thursdays (09.30–10.20/BEA3). The tutorial hour is on Thursdays (10.3011.20/BEA3). The lecture and tutorial topics are as in the following schedule:
Lec.
Week
Dates
Subject
Topics
1
23/02/2010
25/02/2010
Investments: Background and Issues (Chp. 1)
Tutorial: Introduction
Real Assets; Financial Assets; Securities;
Investment Process; Recent Trends
2
02/03/2010
04/03/2010
Asset Classes and Financial Instruments (Chp. 2)
Tutorial: Chp.1 Assignments
Money Market; Bond Market
3
09/03/2010
11/03/2010
Asset Classes and Financial Instruments cont’d
(Chp. 2) Tutorial: Chp.2 Assignments
Equity Securities; Indexes; Derivatives
4
16/03/2010
18/03/2010
Securities Markets (Chp. 3) Tutorial: Chp.3
Assignments
Security Offerings; Security Trading
5
23/03/2010
25/03/2010
Securities Markets (Chp. 3) cont. Tutorial: Chp.3
Assignments
Exchanges; Mechanism of Trading
6
30/03/2010
01/04/2010
Bond Prices and Yields (Chp. 10) Tutorial: Video
Show
Bond Characteristics; Pricing & Yields
7
06/04/2010
08/04/2010
Bond Prices and Yields (Chp. 10) cont. Tutorial:
Chp.10 Assignments
Prices over Time; Default Risk; Yield Curve
10-21/04/2010
Midterm Examinations
8
22/04/2010
27/04/2010
29/04/2010
Macroeconomic & Industry Analysis (Chp. 12)
Tutorial: Chp.12 Assignments
Equity Valuation (Chp. 13)
Security Analysis; Global and Domestic
Economy Business Cycles and Industry
Analysis
9
04/05/2010
06/05/2010
Equity Valuation cont. (Chp. 13) Tutorial: Chp.13
Assignments
Intrinsic Value; Balance Sheet Valuation
10
11/05/2010
13/05/2010
Equity Valuation cont. (Chp. 13) Tutorial: Chp.13
Assignments
Dividend Discount Methods; Price-Earnings
Ratios; The Aggregate Stock Market
11
18/05/2010
20/05/2010
Options Markets (Chp. 15) Tutorial: Chp.15
Assignments
Option Contract
12
25/12/2010
27/12/2010
Futures Markets & Risk Management (Chp. 17)
Tutorial: Chp.17 Assignments
Futures Contract; Mechanics of Trading
Futures Market Strategies; Financial
Futures
31/05-15/06/2010
Final Exams
PLAGIARISM
This is intentionally failing to give credit to sources used in writing regardless of whether they are published or unpublished. Plagiarism (which
also includes any kind of cheating in exams) is a disciplinary offence and will be dealt with accordingly.
MAKE-UPS
Students who have valid excuses will be allowed to take make-up examinations for all exams. There are no make-ups for quizzes, but you will
have to chance to omit the lowest grade quiz or not to take a quiz at all.
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