University of Edinburgh Business School

Option courses

Advanced Corporate Finance

An exploration of research on selected topics in corporate finance, going beyond the content of standard textbooks. Areas examined include corporate governance, financial contracts, and empirical research on mainstream topics such as gearing, dividend policy and takeovers. Students will study a number of academic papers on each topic. The questions examined are ones that confront companies and providers of capital in practice. The aim of research on these questions – and the aim of the course – is to understand the relevant actions of companies and financiers.

Advanced Finance Theory

This course provides an introduction to the theory of financial economics. It will cover the following topics: choices under uncertainty, discrete-time asset valuation (both one-period and dynamics models), contingent claim valuation, portfolio theory, mean-variance analysis, Capital Asset Pricing Model (CAPM), Arbitrage Pricing Theory (APT), and financial markets with imperfections. Students are expected to have some background in both microeconomics and mathematics.

Derivatives

This course will inform you about the nature of derivatives and provides an understanding of how arbitrage pricing works and sets prices in a competitive market. You will gain knowledge of option-pricing modules and be able to make extensions to the basic models. You will learn how to price futures contracts, interest-rate and cross-currency swaps and option, as well as learning about the uses of derivatives for risk management and investment strategies.

Investment Management

This course gives students a broad knowledge and understanding of portfolio management and investment analysis, taking a global perspective and considering a variety of asset classes. It builds on the knowledge gained from the Foundations of Finance Theory core course in semester one. It aims to describe the role of asset allocation, risk management, industry analysis, style analysis and company analysis in portfolio management. Various investment processes are examined and strengths and weaknesses in the various approaches considered. Students will also learn the importance to successful portfolio management of a disciplined investment process, and should, by the end of the course, be able to design or develop a rigorous process for an investment management firm.

Economics for Postgraduates

This course is intended for postgraduate students enrolled in taught and research postgraduate programmes throughout the University who have little previous exposure to economics, but who might find economics to be beneficial for their career and research purposes. The course’s major objective is to introduce students to economists’ way of thinking and equip them with tools for tackling a variety of economic issues ranging from simple household and firm decisions through industry regulation and economy-wide stimuli to societal welfare and global economic policies.

Credit Risk Management

This course introduces students to the theories and practices in credit risk management. Students will consider the application of credit scoring and the methods for credit scoring using scorecards. In particular, students will learn certain techniques required by a lender for effective loan management and for compliance with capital requirement regulations. This course build on students’ knowledge gained in the core courses of the MSc Marketing and Business Analysis programme, therefore complementing the other courses and minimising overlap of materials.

Case Studies in Finance and Investment

The course is designed to extend and deepen an understanding of a range of topics in finance and investment. It makes use of a case study approach, uses report-based assessments and invites student presentations. The course draws upon material introduced and developed in other courses, especially Financial Markets, The Analysis of Corporate Financial Information and Corporate Finance. Class participants are expected to apply the knowledge and understanding gained on other courses of the MSc programme, and their general insights into business problems.

Financial Management for Public and Not for Profit Organisations

This course will develop the knowledge and understanding of students with respect to financial management within the public sector. Students will be introduced to the major financial tools used within the public sector. The course aims to develop the critical as well as the operational capability of students in analysing and handling the above mentioned tools. The course intends to develop a capability and knowledge that students will be able to develop in their specific working environment.

Behavioural Finance and Market Anomalies

This elective is designed to provide an overview of an exciting new area in finance which takes as its premise that investment decision–making and investor behaviour are not necessarily driven by “rational” considerations but by aspects of personal and market psychology. Behavioural finance recognises that our abilities to make complex investment decisions are limited, and that we can improve our performance as investors and fund managers by recognising the biases and errors of judgment to which all of us are prone.