Durham University
Programme and Module Handbook

Postgraduate Programme and Module Handbook 2025-2026

Module FINN40515: Advanced Financial Theory

Department: Finance

FINN40515: Advanced Financial Theory

Type Tied Level 4 Credits 15 Availability Available in 2025/2026 Module Cap None.
Tied to N3K109
Tied to N3K209
Tied to N3K309
Tied to N3K409
Tied to N3KC09
Tied to N3K709

Prerequisites

  • None.

Corequisites

  • Econometric Methods (FINN41715)

Excluded Combination of Modules

  • None

Aims

  • to provide a rigorous training in the theory of modern finance at an advanced level and a thorough synthesis of the most important current research in finance, with an emphasis on the applications of the principles.
  • to provide students with an advanced understanding of normative and positive research in financial theory, together with supporting descriptive and empirical evidence.

Content

  • Financial decision-making under standard preferences (Arrow-Debreu).
  • Static and dynamic asset allocation.
  • Risk and insurance.
  • Classical and neo-classical asset pricing models.

Learning Outcomes

Subject-specific Knowledge:
  • have advanced knowledge and critical understanding of essential components of modern finance theory and associated current research;
  • 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, making use of available facilities;
  • have the ability to learn and work independently in finance, exercising critical judgement in the resolution of complex problematic situations, including appropriate techniques of analysis.
Subject-specific Skills:
  • be able to use highly specialised and advanced technical, professional and academic research skills in the analysis of relevant specific problems in finance;
  • be able to apply problem solving and analytical skills of research to issues in finance in a complex specialised context.
Key Skills:
  • Written Communication;
  • Planning, Organising and Time Management;
  • Problem Solving and Analysis;
  • Using Initiative;
  • Numeracy;
  • Computer Literacy.

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

  • A combination of lectures, seminars and guided reading will contribute to achieving the aims and learning outcomes of this module.
  • The summative written assignment will test students' knowledge and critical understanding of the material covered in the module and in existing literature, their analytical and problem-solving skills, producing a written report equivalent to a draft article.
  • The formative assessment consists of several online tests. The formative assessment on Blackboard allows students to receive timely feedback on their work in order to identify areas of individual strengths and areas where additional study is required.

Teaching Methods and Learning Hours

Activity Number Frequency Duration Total/Hours
Lectures 9 1 per week 2 hours 18
Workshops 4 1 per fortnight 1 hour 4
Revision Session 1 2 hours 2
Preparation and Reading 126
Total 150

Summative Assessment

Component: Written Exam Component Weighting: 100%
Element Length / duration Element Weighting Resit Opportunity
Written in-person exam 2 hours 100% same

Formative Assessment:

Two multiple-choice tests, in-class feedback on Workshop answers prepared by students, and feedback via Blackboard on additional work. The formative tests will take place during the term and are administered electronically on Blackboard.


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