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MODULE CODE: BUU33680 Investments

Lecturer(s)

Professor Brian Lucey 

E-mail: blucey@tcd.ie

     

Module Content/Outline

Investing for the future is a matter of major concern to many individuals and institutions, especially as the risk associated with pension provision continues to increasingly shift from the company to the individual.   In this course we examine the theories of investment, how prices are expected to behave in equilibrium and how they behave in reality. 

We cover topics such as the measurement of risk and return, diversification benefits both domestic and international, asset allocation and portfolio performance.  Throughout this module, students will become familiar with the fundamental concepts and theories of investments used in the academic literature and the financial services industry.

LECTURING AND TEACHING APPROACH:
This module is structured around a series of lectures, tutorials and readings.  Students will be expected to prepare homework in advance of and to contribute to discussions in tutorials. Lecture and tutorial attendance is strongly advised.  Attendance will be taken at tutorials.

LEARNING OUTCOMES:

Having successfully completed this module, the student should be able to:

  • Assess the main concepts of investment theories and their applicability to individuals, financial firms and companies.
  • Compare the main categories of financial assets, and their role in allocating consumption over time. 
  • Evaluate the relationship between risk, return and the covariance of asset returns, and how these contribute to overall portfolio risk and performance.
  • Use financial mathematics to calculate the optimal allocation of investment capital between risky assets. 
  • Critique the theory underlying asset pricing models such as the Single Index Model, the CAPM etc.

RECOMMENDED TEXTS/KEY READING
The recommended textbook for this module is:

Bodie, Kane & Marcus (10th Ed):  Investments, McGraw-Hill.

Some material from Elton et al (9th Ed): Modern Portfolio Theory and Investment Analysis is also used in the course.

Any recent edition either of these textbooks will suffice.  The college library contains many other excellent textbooks on Investments which may also be consulted.

General Supplemental Readings:

Additional readings will also be assigned throughout the course and will be posted on Blackboard

PRE-REQUISITE

BUU22550 Introduction to Finance (SF Year)

ASSESSMENT
Assessment for this course will be based as follows: 

· 30% Continuous Assessment (Project) 

· 70% Exam 

The project is a group project. Each group will have a maximum of four members. You may choose your own group and self-enrol your group on blackboard. Further details on the project will be available in the assignments folder on blackboard. 

A penalty for late submission will apply. Students unable to submit an assignment for medical reasons must produce a medical certificate to the School of Business Studies office within three working days of the missed submission date. Certificates received after that time will not be accepted.