Unit information: Portfolio Management in 2015/16

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
Pre-requisites	Corporate Finance (EFIM20006)
Co-requisites	Financial Markets (EFIM30019)
School/department	School of Accounting and Finance - Business School
Faculty	Faculty of Social Sciences and Law

Description including Unit Aims

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 Information

10 hours of lectures, 5 fortnightly tutorials.

Assessment Information

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