FIE400E Investments

• Topics

  This course introduces students to the main concepts and models in the area of asset pricing and their applications to investment problems. The course covers three blocks of topics:

  1. Analysis in connection with the three main types of financial instruments:

  • Stocks
  • Interest rate instruments (bonds/bills)
  • Derivatives (options, futures and forwards)

  2. Further development of "standard portfolio theory":

  • Portfolio analysis
  • Capital Asset Pricing Model (CAPM) and new variants
  • The efficiency characteristics of financial markets
  • Investment analysis and portfolio management
  • New management principles

  3. Discussion of

  • Pricing and valuation
  • Management and strategies
  • Institutional conditions

• Learning outcome

  Upon course completion, the students will be able to:

  Knowledge

  • Understand the principles of pricing and valuation of financial instruments such as stocks, derivatives and fixed income securities.
  • Explain portfolio theory and its relation to the capital asset pricing model (CAPM) and variants of the model.
  • Understand the principles of asset allocation and strategies, as well as performance evaluation of portfolios.

  Skills

  • Apply the theory and models on practical problems of relevance for investors through in-depth knowledge of the financial markets and rigorous analytical thinking.
  • Solve financial problems using Microsoft Excel.

  General competence

  • Address investment decisions in a systematic manner focusing on financial theory and empirical evidence.
  • Communicate the knowledge to investment professionals and carry out extensive independent work on investment analysis.
  • Provide insights to a wider audience about the differences among the basic types of securities and how they fit in the total portfolio picture.
  • Form an opinion about current issues and debates covered by media and finance journals.

• Teaching

  Lectures and problem sets.

• Recommended prerequisites

  It is recommended that students have taken courses like BED3 / BED030 Investment.

• Credit reduction due to overlap

  FIE400E course can not be combined with FIE400N, which is the Norwegian version of the same course.

• Compulsory Activity

  Approved problem sets, groups of up to 5 students.

  Compulsory activities (work requirements) from FIE400N is valid for FIE400E.

• Assessment

  4 hour school exam conducted digitally and with pen and paper.

  The students will have access to Excel.

• Grading Scale

  A - F

• Literature

  • Bodie, Z., A. Kane & A.J. Marcus: Investments. International Student Edition, 13th Edition, McGraw-Hill, 2024.

• Permitted Support Material

  Calculator 

  One bilingual dictionary (Category I) 

  All in accordance with Supplementary provisions to the Regulations for Full-time Study Programmes at the Norwegian School of Economics Ch.4 Permitted support material https://www.nhh.no/en/for-students/regulations/https://www.nhh.no/en/for-students/regulations/