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 are 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.

• Other information

  Use of laptop: the laptop can only be used for the Internet to download and upload the Excel file in WISEflow and for Excel to work with the downloaded Excel file. The exam will include Device monitor.

• 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/