Module ECON45815: FINANCIAL RISK MANAGEMENT (TAUGHT)

Department: Economics and Finance

ECON45815: FINANCIAL RISK MANAGEMENT (TAUGHT)

Prerequisites

• None

Corequisites

• None

Excluded Combination of Modules

• Financial Risk Management (Online) - ECON45715

Aims

• develop students' ability to master the knowledge and understanding at an advanced level of the means by which risk can be managed, primarily through the use of financial derivatives and the problems inherent in using such instruments; 
• provide students with the opportunity to develop the ability to critically understand academic literature relating to risk management; 
• provide students with the ability to critically review this specialised complex area of knowledge with a view to undertaking a dissertation in the field of financial risk management in an ethical maner.

Content

• Hedging Strategies with Futures; 
• Applied Topics in Futures Markets; 
• Trading Strategies using Option Contracts; 
• Option Greeks and Volatility Smiles; 
• Value at Risk; 
• Corporate Liabilities as Options; 
• Credit Risks; 
• Estimating Volatility and Correlation; 
• Advanced Topics on Volatility Modelling and Option Pricing.

Learning Outcomes

• By the end of the module students should: 
• have an advanced knowledge and critical understanding of how derivative financial instruments can be used to manage risk and the potential problems associated with using such instruments; 
• have an advanced understanding of different strategies for managing risk using options and futures, including an understanding of the complexities and problems associated with the use of such strategies; 
• have explored, understood and appreciated the complexity and contradictions of the current academic literature and its implications for professional practice, and be able to identify open questions for their own research; 
• have demonstrated the ability to learn and work independently in this area, exercising critical judgement and discrimination in the resolution of complex problematic situations.

• By the end of the module, students should: 
• have used highly specialised and advanced technical and academic skills to analyse the extent to which risk management is successful. 
• have practised problem solving and analytical skills in a complex specialised context.

• effective written communication skills
• planning, organising and time management skills
• problem solving and analytical skills
• the ability to use initiative
• advanced skills in the interpretation of data
• advanced computer literacy skills

Modes of Teaching, Learning and Assessment and how these contribute to the learning outcomes of the module

• Learning outcomes will be met through a combination of taught input, groupwork, case studies and discussion, supported by guided reading and specially-written self-study material.
• The summative assessment of the module is a two-hour written examination which will test students' specialist knowledge and critical understanding of the material covered in the module, their problem-solving and analytical skills.

Teaching Methods and Learning Hours

Summative Assessment

Formative Assessment:

A written assignment of 1,500 words based on a case study.

■ Attendance at all activities marked with this symbol will be monitored. Students who fail to attend these activities, or to complete the summative or formative assessment specified above, will be subject to the procedures defined in the University's General Regulation V, and may be required to leave the University