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Unit information: Portfolio Management in 2018/19

Please note: It is possible that the information shown for future academic years may change due to developments in the relevant academic field. Optional unit availability varies depending on both staffing and student choice.

Unit name Portfolio Management
Unit code EFIM30021
Credit points 10
Level of study H/6
Teaching block(s) Teaching Block 2 (weeks 13 - 24)
Unit director Dr. Friederich
Open unit status Not open

Corporate Finance (EFIM20006)


Financial Markets (EFIM30019)

School/department School of Economics, Finance and Management
Faculty Faculty of Social Sciences and Law


We will discuss the construction, implementation and evaluation of investment portfolios. An important feature of this topic is that the insights and results we will derive are applicable on any scale. That is, they are equally valid from the perspective of a private investor or that of a multi-billion pound pension or hedge fund manager.

In the light of theoretical and empirical results in asset pricing, we will:

  • Discuss the construction of portfolios of stocks and bonds
  • Derive the techniques used to assess fund manager performance after adjusting for the risk involved in their strategy.
  • Examine the empirical evidence available on the performance of professional fund managers and understand its limitations.

Intended learning outcomes

On successful completion of this unit a student will be able to:

  • Understand the implications of theoretical and empirical research in asset pricing for real-world investment strategies
  • Comprehend the issues involved in measuring the performance of professionally managed portfolios (investment funds).
  • Understand how some degree of mispricing can be exploited whilst retaining the key insights of market efficiency.

Understand models of performance decomposition – that is, how to identify the specific sources of performance of a large and diversified investment portfolio.

Teaching details

10 lectures, 5 classes.

This pattern of teaching may be changed slightly to accommodate the Easter Vacation.

Assessment Details

Formative: One, mostly numerical, assignment

Summative: 100% 1.5 Hour exam

All learning objectives are assessed by both summative and formative assessment

Reading and References

Bodie, Kane and Marcus, Investments and Portfolio Management, McGraw-Hill, 10/e