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DRPS : Course Catalogue : School of Mathematics : Mathematics

Postgraduate Course: Finance, Risk and Uncertainty (MATH11088)

Course Outline
SchoolSchool of Mathematics CollegeCollege of Science and Engineering
Credit level (Normal year taken)SCQF Level 11 (Postgraduate) AvailabilityNot available to visiting students
SCQF Credits10 ECTS Credits5
SummaryThis course is available only to students on the 'Financial Modelling and Optimization' and 'Financial Operational Research' Degree Programmes.

- Identify the main building blocks of modern finance theory;
- Use compounding and discounting to evaluate financial proposals;
- Determine the net present value and internal rate of return of investment proposals;
- Explain the merits of the net present value rule as an investment criteria;
- Appreciate the merits as well as the limitations of the internal rate of return as an investment criterion;
- Determine the cost of borrowing and evaluate financing proposals;
- Define and measure risk;
- Evaluate the risk of investment and securities;
- Construct portfolios to reduce risk exposure;
- Differentiate between efficient and inefficient portfolios;
- Develop the capital asset pricing model;
- Explain and critically evaluate capital market theory;
- Understand the role of beta as a measure of risk;
- Undertake the evaluation of capital budget proposals;
- Derive the implications of the capital asset pricing model for security analysis and corporate financial management;
- Explore the behaviour of the prices of financial assets and returns in competitive capital markets;
- Critically appraise the efficiency of the capital market;
Course description Not entered
Entry Requirements (not applicable to Visiting Students)
Pre-requisites Co-requisites
Prohibited Combinations Other requirements MSc Financial Modelling and Optimization and MSc Financial Operational Research students only.
Course Delivery Information
Academic year 2015/16, Not available to visiting students (SS1) Quota:  None
Course Start Semester 1
Timetable Timetable
Learning and Teaching activities (Further Info) Total Hours: 100 ( Lecture Hours 30, Summative Assessment Hours 2, Programme Level Learning and Teaching Hours 2, Directed Learning and Independent Learning Hours 66 )
Assessment (Further Info) Written Exam 70 %, Coursework 30 %, Practical Exam 0 %
Additional Information (Assessment) See 'Breakdown of Assessment Methods' and 'Additional Notes', above.
Feedback Not entered
Exam Information
Exam Diet Paper Name Hours & Minutes
Main Exam Diet S2 (April/May)MSc Finance, Risk and Uncertainty2:00
Learning Outcomes
1. Skills in structuring and taking decisions;
2. An appreciation of the need to evaluate decision criteria in relation to the objectives of the decision;
3. An ability to construct and manipulate mathematical models;
4. An appreciation of the role of abstract reasoning in understanding and approaching practical problems;
5. The ability to assess and test theories and hypotheses on the basis of empirical evidence.
Reading List
Additional Information
Graduate Attributes and Skills Not entered
Special Arrangements MSc Financial Modelling and Optimization and MSc Financial Operational Research students only.
Study Abroad Not Applicable
Course organiserDr Sotirios Sabanis
Tel: (0131 6)50 5084
Course secretaryMr Thomas Robinson
Tel: (0131 6)50 4885
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