IndianInstituteofForeignTrade,Delhi

Programme:MBA(IB)

CourseName
CourseCo-ordinator:Dr. Asheesh Pandey
Email:asheesh@iift.edu
Term: IV Credits: 2

CourseIntroduction:
Thiscoursecoversthetheoriesandanalyticaltoolsusedforvaluingvariousfinancialassetsmainly
eqities, and for making investment decisions. Mostly thiscourse deals with the issues
related to both individual and portfolio of financial securities.All the issues include the
market efficiency, risk and return associated with the stocks
andbonds,fundamentalandtechnicalanalysis,assetpricingmodels,financialmarketanomalies,
constructionofoptimalportfolio,portfoliomanagementstrategiesetc.

CourseObjectives:
 Tofamiliarizethestudentswiththefinancialinstrumentsavailableforinvestments
 Todeterminetheintrinsicvalueofthefinancialsecurities
 Tofamiliarizethetoolsused fortesting marketefficiency
 Toanalyzethefactorsconsideredforinvestmentsinequityandbondmarkets
 Todiscussvarioussingleandmultifactorasset pricingmodels
 Todiscussthemodelsusedfor constructionofoptimalportfolios
 Toexplorevariousportfoliomanagementstrategies

ProgrammeLearningGoalscoveredthroughthisCourse
 InnovativeThinkingwithCriticalAnalysis
 Managingcomplex,uncertainbusinesssituations

Pedagogy:

Lectures,ProjectWorkandCasestudies
 §
Linkages withOtherCourses(optional- mayrelatedirect/indirectlinkages)

EvaluationComponents:
One Quiz 20

One Mid-termTest(Quiz)*: 20

Assignment*: 20

EndTermExamination: 40

(EndTermshouldbe40% andnosinglecomponentcanbemorethan30%.Theevaluationcomponent/swhich
provideadirectmeasureofoneormoreprogrammelearninggoalsmaybemarkedwith*andatleastonesuch
componentshouldbeindicated)

TextBook/
ReferenceTextTextBook:

InvestmentsbyZviBodie,AlexKane,AlanJ.Marcus,PitabasMohanty,10thEdition,Publisher;M
cGrawhillEducation.

ReferenceText:

Aswath Damodaran, Investment Valuation, Wiley India, Delhi (2012, 3rd Edition)

ModernPortfolioTheory:Foundations,Analysis,andNewDevelopmentsbyDongcheolKimDo
ngheolKimJackClarkFrancis,Publisher:Wiley
AnalysisofInvestmentsand
ManagementofPortfoliosbyReillyandBrown,10thEdition,Publisher:CengageLearning
SessionPlan:

Session TopicandSubtopics ReadingRef

erence/Cases

1 The Investment Environment and asset classes TEXT BOOK:BKM CH-1

 Reals Assets versus Financial Assets
 Asset Classes and Financial Instruments
 The Investment Process

2 Understanding Securities Market TEXT BOOK: BKM

 The Stock Markets, CH-2
 New Issue Market and
 Secondary Market

 Derivatives
3 Cost of Capital TEXT BOOK: BKM
 Cost of Equity
CH-2
 Cost of Debt
 Determination of Beta

4 FundamentalAnalysis: EIC Analysis Chapters-12, 13, 14

(TextBook)

5 Dividend Discount Model Handouts to be given

 Stable Growth model through Aswath
 Two Stage Model Damodaran book on
 Three Stage Model Valuations

6 Free Cash Flow to Equity model (FCFE) Handouts to be given

through Aswath
Damodaran book on
Valuations
7 Efficient Market Theory TEXT BOOK: BKM CH-
17

8 Technical Analysis Guest Session

9. Relative Valuation Handouts to be given

through Aswath
Damodaran book on
Valuations
10 Risk and Risk Aversion TEXT BOOK: BKM
 Risk, Speculation and Gambling CH-6
 Risk Aversion and Utility Value
 Risk Tolerance and asset allocation
11 Portfolio of Two Risky Assets TEXT BOOK: BKM CH-
 Risk and return of two risky portfolios 7
 Excel based calculation of risk and return at
various correlation levels

12 Optimal Risky Portfolio TEXT BOOK: BKM

 Optimal Risky Portfolio with two risky assets and CH-7
risk free asset
 13 PortfolioPerformanceEvaluation Chapter-25(TextBook)

AnyOtherDetailedInstructions/Information (optional)
Otherrequiredreferencesandcaseswillbeprovidedintheclass.

AdditionalReadings/Journals(optional)