Programme Content Part 2 in Reading

Compulsory Modules

Plus a choice of on one of the following:

Corporate Finance

Convenor: Dr Carol Padgett   Credits: 20

Introduces students to the main financial decisions taken by companies, and examining how those decisions influence the market’s valuation of companies. By the end of the module it is expected that students will be able to: undertake investment appraisals in the face of uncertainty; understand how new security issues are made, and analyse their consequences; analyse the effects of dividend policy and share repurchases on company value; understand how companies manage working capital and how companies manage risk. 

Outline content: Companies, objectives and information sources; Capital budgeting under certainty and uncertainty; Capital budgeting using real options; Capital structure: New issues and Debt and the weighted average cost of capital; Dividend policy; Information and signalling; Working capital management; Corporate risk management; Exit from the stock market.

Design, Implementation and Risk Aspects of Islamic Financial Products and Services

Convenor: INCEIF Faculty    Credits: 20

Provides students with the opportunity to study the application of Shari’ah principles and nominate contracts in the design of financial products and services that are Shari’ah compliant, as well as the risk characteristics of these products and services, with particular reference to Islamic banks and insurance (Takaful) undertakings.

Outline content: Review of Shari'ah principles - Fiqh al Muamalat; Islamic banking products and their basis in nominate contracts - Islamic financing (asset side); Islamic banking products and their basis in nominate contracts - Islamic funds mobilisation (liabilities & capital side); Islamic securities (sukuk); Risk management and capital adequacy aspects; Islamic insurance (Takaful):  its basic principles and basis in Fiqh al Muamalat; Supervisory and regulatory considerations.

Islamic Financial Institutions and Markets

Convenor: INCEIF Faculty    Credits: 10

Develops deeper analytical and theoretical insights of the two main components that constitute the Islamic financial system and a full comprehension of the various financial systems and institutions that operates in the Muslim countries.

Outline content: Functions of Financial Institutions and Markets; An Overview of the Global Financial System; The History and development of Islamic Financial Institutions; The Islamic Financial System of Selected Muslim Countries; The Islamic Financial Institutions (Covering History & Organisation, Function and Product & Services); The Similarities and Differences of Islamic Financial Institutions in Selected Muslim Countries; Islamic Financial Markets (Covering Function & Organisation, Mechanism, Regulators & Regulations and Development); The Monetary Authority / Central Bank.

The Principles of Islamic Commercial Jurisprudence and the Nominate Contracts

Convenor: INCEIF Faculty    Credits: 10

Provides students with the opportunity to study the juristic basis of Islamic finance, and the nominate contracts that are set out in Islamic commercial jurisprudence (the Fiqh al Muamalat).

Outline content: The origins of Islamic commercial jurisprudence; Prohibitions to be respected in order for Islamic contracts to be valid; Avoidance of riba (pure return on money), maysir (speculation), and gharar (uncertainty or ambiguity of subject matter); The frequently used nominate contracts; Overview of Islamic financial products and their basis in nominate contracts; Shari'ah governance of Islamic financial institutions; The IFSB Guidelines on Shari'ah governance.

 

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Essentials of Financial Engineering

Convenor: Dr Marcel Prokopczuk    Credits: 10

The module provides an introduction to the basic techniques employed in Financial Engineering. Students will understand how these methods can be applied to design securities with desired payoff characteristics. They will be able to evaluate complex securities by means of reverse engineering and be aware of possible problems when these methods are applied in real world situations.

Outline content: Introduction to Financial Engineering, cash flow engineering, basic financial products, interest and forward rates, no-arbitrage and the law of one price; Pricing and hedging by replication, major interest rate (IR) swap structures, IR swaps, currency forwards and cross currencies FX-swaps, options; Structured products, introduction and evaluation; Dynamic strategies for hedging and principal protection; Credit markets: CDS engineering, credit indices and CDO’s.

Financial Regulation and Regulatory Policy

Convenor: Dr Mads Andenas    Credits: 10

Provides a basic understanding of the regulatory framework and to introduce the concepts of financial market regulation and analyse the manner in which financial firms operate. We will challenge current and past thinking on regulatory structures and concepts especially in the context of the recent financial crisis, which provides us with a rich source of information on the pros and cons of various options. One of the key aims to provide students with the skills and knowledge needed to gain an understanding of the reform processes and their consequences for markets around the world.

Outline content: Aims and Objectives of Financial Regulation; The Regulation of Financial Firms and Products; The Regulation of Financial Intermediaries.

International Securities Markets

Convenor: John Evans     Credits: 10

International Securities Markets applies general valuation risk assessment methods to: fixed income securities, derivatives and markets. It describes the basic characteristics of each fixed-income security, cash and underlying, and develops practical strategies for finding its value and assessing its risk. It also considers how the markets for these securities are related and begins the task of showing how these relationships can be exploited for trading or investment. The analytical techniques introduced in this module are applied to allow the successful candidate to apply directly to industry the more theoretical market valuation and risk models learned in other core modules taken in the first term.

Outline Content: Fixed Income Analysis; Rates Trading and Hedging; Credit Analysis and Products.

Managing Securities Operations

Convenor: TBA    Credits: 10

Managing Securities Operations is learning about and applying the concept of Operations Management to a financial institution. The course combines teaching about both the technical aspects of securities operations management and theoretical aspects of managing the risks inherent in such as business. It also serves as a base for those interested in further study in operational risk management. The analytics techniques taught in this course serve to synthesise much of the material being taught in the first term core topics of products, markets and institutions by learning how to apply them with regard to management theory. 

Outline content: Essential operational management concepts; The operational structure of a securities trading organisation; The many types of securities transactions; Understanding the trade life cycle - post trade; Understanding the trade life cycles - funding; Operational risks and how to manage them.

Topics in the History of Finance

Convenor: Professor Adrian Bell    Credits: 10

This module aims to provide students with an understanding of the origins of Financial Markets, and with a broader appreciation of the early development of products and innovations in Finance – which many assume are recent twentieth century inventions.

Outline content: The module will focus on topics that can throw light on the development of financial markets over time. It is not restricted by date, but will draw mainly upon Medieval Europe for its focus. Topics will include: Forward Contracts for the supply of Wool in the 13th Century; Early Italian Merchant Banks - Riccardi, Bardi; The English Company of 1339; The South Sea Bubble - John Law; War Finance; Tulip Mania.