Investment Management

This subject has the following teaching availabilities in 2016:

Estimated total time commitment of 120 hours per semester

OR:

None

None

None

For the purposes of considering request for Reasonable Adjustments under the Disability Standards for Education (Cwth 2005), and Student Support and Engagement Policy, academic requirements for this subject are articulated in the Subject Overview, Learning Outcomes, Assessment and Generic Skills sections of this entry.

It is University policy to take all reasonable steps to minimise the impact of disability upon academic study, and reasonable adjustments will be made to enhance a student's participation in the University's programs. Students who feel their disability may impact on meeting the requirements of this subject are encouraged to discuss this matter with a Faculty Student Adviser and Student Equity and Disability Support: http://services.unimelb.edu.au/disability

This subject is designed to equip students with the tools necessary to enable them to make the core investment management decisions that managers face on a daily basis as well as the knowledge as to where they can find the information necessary to apply those tools. This subject is an introduction to investment analysis, with emphasis on equity securities and fixed income securities. The topics covered focus on issues fundamental to financial managers, money managers, risk managers, financial advisors and regulators. These topics include fundamental ideas in asset pricing; modern portfolio theory and its applications; equilibrium theories of asset pricing; portfolio performance evaluation; and key issues in the pricing and portfolio allocation of fixed income assets.

On successful completion of this subject, students should be able to:

• Discuss core concepts in investment management, including risk, return, risk premium and risk aversion;
• Analyse the portfolio selection problem, with emphasis on the mean variance framework;
• Explain the benefits of diversification and the main drivers of those benefits;
• Critically evaluate alternative theories of asset pricing and their application in the valuation of securities;
• Develop techniques to evaluate the performance of portfolio managers;
• Analyse critical issues in the valuation of fixed income securities and the management of fixed income portfolios;
• Critically evaluate the theories of the term structure of interest rates and their application to fixed income portfolio management.

• Two 1-hour mid-semester examinations, the first examination held within weeks 4-6, the second examination held within weeks 8-10 (40% total);
• A 3-hour end-of-semester examination (60%).

You will be advised of prescribed texts by your lecturer.

This subject is not available as a breadth subject.

On successful completion of this subject, students should have improved the following generic skills:

• High level of development: have an in-depth knowledge of financial markets; interpretation and analysis; critical and creative thinking; engagement in meaningful public discourse.
• Moderate level of development: written communication; problem solving; synthesis of data and other information; evaluation of data and other information; receptiveness to alternative ideas; interpersonal and decision-making skills.
• Some level of development: oral communication; collaborative learning; team work.