In this course the theoretical and empirical issues of the financial economics are studied. Among these, the functioning of the financial markets, the determinants of the interest rates, the volatility and the uncertainty of the financial markets and assets. The mean-variance model and the CAPM are studied in the first part of the course. We will use Excel and some other software to measure and estimate the security market line and the variability of the expected rates. Then, the expected utility theory and its applications are studied in the second part of the course.

First part

• The functioning of the financial markets: the determinants of the interest rates; volatility and uncertainty of financial assets
• The mean-variance model and the CAPM
• The security market line
• The portfolio theory, asset pricing, arbitrage

Second part

• Expected utility theory
• Risk aversion

Knowledge and comprehension skills: At the end of the course, students will be able to understand the main issues related to the financial markets and agents operating there: savers, inverstors, brokers, saving managers. In particular, they will be able to critically assess the principal models and issues concerning the asset pricing. Students will be able to use these models for analyzing the economic patterns and interpreting what happens in real economic world, and actively participating to the economic and financial debate.

Applying knowledge and understanding: Thanks to the course attendance, after passing the exam, the students will be able to deal with a variety of tools to analyze financial and economic information and understand autonomously the evolution of the main issues related to the portfolio management. Students will be able to assess official financial reports with particular attention to the volatility and uncertainty of financial assets. They will be able also to analyze financial data to understand the macroeconomic dynamics of the economy.

Making judgements: Students will be able to gather information and data on the subjects of the course so to make autonomous judgements.

Communication skills: Students will develop reasoning and communication skills on issues related to the subjects of the course thanks to the command of specific terminology used during the lectures and the tutorials.

Learning skills: Students will gain in-depth knowledge of the main models of the financial markets and their functioning. This will allow them to advance their knowledge in finance and prepare them for more advanced courses, inclduding those in applied economics and monetary economics.

The teaching material prepared by the lecturer in addition to recommended textbooks (such as for instance slides, lecture notes, exercises, bibliography) and communications from the lecturer specific to the course can be found inside the Moodle platform › blended.uniurb.it

• Seminars
• Tutorials

Teaching

Frontal lectures and tutorials. The lectures will be developed by following the textbook scheme. Other teaching materials (e.g., PPT and PDF file) used during the lectures will be part of the program and will be made available in the website of the course.

Attendance

The participation in the lecture classes and tutorials is highly recommended.

Course books

• Brealey, R. A., Myers, S. C., Allen, F., & Mohanty, P. (2012). Principles of corporate finance. Tata McGraw-Hill Education.
• Other teaching materials will be available on Moodle › blended.uniurb.it.

Assessment

Written exam. It is composed by a mix of open-ended questions, exercises and closed-ended questions for a total of 6 questions. The maximum score is 32 points that corresponds to the grade 30/30 with honors. The time to do the written exam is one hour.

Disability and Specific Learning Disorders (SLD)

Students who have registered their disability certification or SLD certification with the Inclusion and Right to Study Office can request to use conceptual maps (for keywords) during exams.

To this end, it is necessary to send the maps, two weeks before the exam date, to the course instructor, who will verify their compliance with the university guidelines and may request modifications.

Teaching

The same for attending students

Attendance

The same for attending students

Course books

The same for attending students

Assessment

The same for attending students

Disability and Specific Learning Disorders (SLD)

Students who have registered their disability certification or SLD certification with the Inclusion and Right to Study Office can request to use conceptual maps (for keywords) during exams.

To this end, it is necessary to send the maps, two weeks before the exam date, to the course instructor, who will verify their compliance with the university guidelines and may request modifications.

The student of the Erasmus Program can request to sit the final exam with an alternative bibliography.