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Online course materials for BMAN31802

Applied Investment Management


Unit code: BMAN31802
Credit Rating: 10
Unit level: Level 3
Teaching period(s): Semester 2
Offered by Alliance Manchester Business School
Available as a free choice unit?: N

Requisites

Prerequisite

Additional Requirements

BMAN23000(A) or (B) is the Pre-Requisites for BMAN31802. Only available to students on BA (Econ), BSc Management/Management (Specialism), BSc IM, BSc IMABS, BA/BSc IBFE, BSc MathswFin.

Pre-requisite course units have to be passed by 40% or above at the first attempt unless a higher percentage is indicated below.

Pre-requisites:BMAN23000(A) or (B)Foundations of Finance or BMAN20072 Investment Analysis

It is strongly preferred that students have achieved  60% or higher in one of the pre-requisite course units listed above or BMAN 20072 Investment Analysis for Applied Investment Management. It is also preferred that students have attended at least one statistics or econometrics course units and understand the fundamentals of regression analysis.

Aims

This course demonstrates to students how finance theory is applied in an asset management context. The central aim is to familiarise students with the nature of financial decision making by investment entities such as mutual funds,hedge funds, private equity managers and style investors. The course exposes students to academic research, practitioner-oriented readings, real world case studies, and projects. These materials encompass both conventional wisdom and the state-of-the-art methods used in managing a portfolio of equity securities and alternative assets.

Overview

This course describes the fundamentals of investment strategies and some of the main strategies used by hedge funds and proprietary traders, as well as provides a methodology to analyze them. It uses academic studies, practitioner-oriented readings, case studies, and projects to cover both conventional wisdom and state-of-the-art methods used in managing a portfolio of equity securities and alternative assets. The class also covers institutional issues related to liquidity, margin requirements, risk management, and performance measurement. The class has quantitative component. As a result of the advanced techniques used in state-of- the-art hedge funds, the class requires the students to work independently, analyze and manipulate real data, and use econometrics modelling.

 

Teaching and learning methods

10 two hour lectures and 6  one hour workshops over the duration of the course. Plus computer-based exercises.

Total study hours: 100 hours split between lectures, classes, reading, self-study and preparation for classes and examinations.

Learning outcomes

By the end of the course students should be able to:

•      Apply basic tools to make core investment management decisions

•      Explain the functioning of the asset/wealth management/hedge fund industry

•      Understand the nature of the investment decision making process in a range of asset management contexts.

•      Analyze the financial and management problems facing mutual funds and hedge funds, and the investment tools that can be used to deal with these problems.

Assessment Further Information

  • Professional Investment Strategy Group Report : 35% (students will work in teams of less than 4), 2000 words
  • In class group presentation: 15%
  • 1.5 hour unseen examination: 50%

Syllabus

The classes will involve a combination of lectures, discussions, guest speakers, cases, team projects and presentations.

Course Outline:

Class 1: Capital Market: Efficiency and Inefficiencies

Class 2: Hedge Fund Investment Strategies Overview

Class 3: Valuation Basics: Relative Valuation and Multiples

Class 4: Momentum Investing 1: Momentum Strategies and How to Form Momentum Portfolios

Class 5: Momentum Investing 2: Understanding the Source and Risk of Momentum, Refined Momentum Trading Strategies

Class 6: Value Investing: Basics, Comparison with Other Approaches, What’s Historically Worked & Not Worked

Class 7: Style Investing in Practice: Senior Investment Professionals TBD

Class 8: Long-short investment strategies

Class 9: Market Neutral Strategies

Class 10: Short Biased Strategies

There might be a session involving guest speakers to offer student a professional context.

Recommended reading

Main Text Book:

Efficiently Inefficient: How Smart Money Invests and Market Prices Are Determined, by Lasse H. Pedersen 2015

Additional readings:

Aswath Damodaran, 2012, Investment Philosophies: successful strategies and the investors who made them work, Hoboken, New Jersey: John Wiley & Sons, Inc.

Benjamin Graham, 2006, The Intelligent Investor, Revised Edition by Jason Zweig, New York: Harper Business.

Feedback methods

  • Informal advice and discussion during lectures and workshops.
  • Written and/or verbal comments on assessed group coursework and group presentations.
  • Responses to student emails and questions from a member of staff
  • Generic feedback posted on Blackboard regarding overall examination performance

Study hours

  • Lectures - 20 hours
  • Seminars - 6 hours
  • Independent study hours - 74 hours

Teaching staff

Jiaguo Wang - Unit coordinator

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