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Asset management

Code: 61542
ECTS: 3.0
Lecturers in charge: pred. mr. sc. Darko Brborović - Lectures
English level:

1,0,0

All teaching activities will be held in Croatian. However, foreign students in mixed groups will have the opportunity to attend additional office hours with the lecturer and teaching assistants in English to help master the course materials. Additionally, the lecturer will refer foreign students to the corresponding literature in English, as well as give them the possibility of taking the associated exams in English.
Load:

1. komponenta

Lecture typeTotal
Lectures 30
* Load is given in academic hour (1 academic hour = 45 minutes)
Description:
COURSE AIMS AND OBJECTIVES: To demonstrate the mechanisms of primary capital markets, elucidate on the theoretical foundations for financial property management and show its practical objectives.

COURSE DESCRIPTION AND SYLLABUS:
1. Property type (investments). Fixed earnings instruments - bonds, treasury notes etc.: divisions according to the issuer (government, companies...); divisions according to coupons (fixed, floating, inverse...); other divisions and characteristics (convertible/non-convertible, mortgage, with an absorption fund, with built in options...). Shares: bit shares, dividends and capital gains; other divisions and characteristics (preferential, standard, convertible/non-convertible, according to the issuer and the origin...). Real estate: earnings from real estate investments. Instruments implemented:: options, forward and future contracts, swaps, other instruments implemented. Alternative instruments: Investment funds: divisions open/closed, interpretation of a closed fund; divisions according to the way of investing: passive/active; other possible divisions and features (hedge funds, trust funds...).
2. Capital markets. Types and sizes of markets of various financial instruments: primary/secondary markets (trading); markets for various financial instruments; some known markets. Capital markets participants. Liquidity. Stock exchange indices. Factors influencing capital markets. Capital markets as a barometer. Croatian capital markets.
3. Modern portfolio theory. Investment risks: definition of risk (possible definitions, accepted definitions); historical data on returns and risks in various forms of investing. Risk dispersion. Principles and general results of the modern portfolio theory: efficacy limit; market portfolio; Capital Asset Pricing Model.
4. Evaluation of financial instruments. Bonds: coupon, running return; return till maturity, return curve; models of evaluation through modelling of interest rates (binomial models). Stocks: fundamental analysis of shares; evaluation with multiplicators and its uses (P/E, P/B...); model of discounting dividends; models of discounting cash flows (free flow of cash to stock holders...); risks and possible errors in valuation of stocks. Instruments implemented (convertible, options...).
5. Measuring the efficacy of investments. Ways of calculating returns. Investment costs: direct costs: brokerage and analyst costs, market costs etc; indirect costs: shifting markets, bid - ask spread and (li equ.), liquidity cost... Advantages of investing in investment funds. Investment strategies and aims (with respect to the type of investor, passively/actively...). Comparison of passive and active strategies. Comparison with the indices. Taxation aspects.
Literature:
  1. E. J. Elton, M. J. Gruber: Modern Portfolio Theory and Investment Analysis, 5th edition
  2. B. G. Malkiel: A Random Walk Down Wall Street, 8th edition
  3. W. F. Sharpe et al: Investments, 6th edition
  4. J. C. Hull: Options, Futures and Other Derivatives, 4th edition
  5. J. J. Siegel: Stocks for the Long Run, 3rd edition
Prerequisit for:
Enrollment :
Passed : Macroeconomics 2
Passed : Microeconomics 2
4. semester
Mandatory course - Regular study - Financial and Business Mathematics
Consultations schedule: