This course provides participants with the essentials of finance and risk management including the theories, concepts, tools and techniques for understanding, discussing and evaluating key themes in finance and risk management. Many of the principles in risk management were developed in relation to financial firms such as banks and investment fund managers, but they are also applicable to non-financial firms in commerce, manufacturing, government or other sectors. The world changed after the global financial crisis of 2007-2009, in particular, the changes and challenges in financial sector regulatory constraints and the higher capital costs under Basel III. All firms face risks although the types of risks they face and their extent differ, consequently, risk management requires strategies for dealing with financial risks and appropriate techniques for implementing the strategies. Based on academic research on the principles together with practical examples and applications, students will learn how to calculate financial risks, and to change the combination of risk and expected return by taking the form of derivatives contracts (such as options and futures) that powerfully facilitate strategies to reduce risk (‘hedging’) or increase it (‘speculation’). Students will learn how banks manage downside risks through improving their risk measurement and management methodologies under the interconnected nature of the global financial system.
Topics that are covered in the course include understanding financial markets, financial instruments, financial institutions and the principles of risk management; examining concepts and methods used in the analysis of portfolios of financial securities, including stocks and bonds; explaining the use of financial derivatives for hedge and speculation in financial markets; and evaluating the application of risk.
On successful completion of the course, a student should be able to demonstrate the ability to:
- Identify what the elements and functions of financial markets, institutions, the financial instruments of capital markets and their increasingly significant interactions in the global economy
- Understand what is portfolio risk and return and how risk and return are related and then learn how to measure and analyse portfolio risk-return analysis in equity and bond investment
- Understand the theoretical concepts of financial derivatives in particular, futures and options contracts, distinguish between hedging and speculation strategies using futures and options, and skilfully use derivatives to managing financial risks, for instance, changes of interest rates, currencies, an stock prices.
- Know the types of financial risks in banking and financial sectors, and the principles of managing financial risks, and learn how to measure and manage key regulatory risks in banking sector (market risk, credit risk, operational risk) under the Basel III.
- Engage in rational thinking and discussing finance and risk management using a multidisciplinary framework by linking theories and concepts in finance, investment, business cycles, global financial crises and macroeconomic policies.
- Develop and exhibit the intellectual disposition of confidence in reason to critically discuss the issues in finance, investment and risk management in the global economy.
Assessment is optional and will be in the form of presentations (30%) and a 2,000-2,500 word essay (70%) to be handed in 2 weeks after the end of the course.
15 SOAS Credits
This course is worth 15 credits in the UK system. 15 credits is equivalent to 4 credits in the US system and 7.5 ECTS in the European system. If you intend to transfer credit to your home institution, please check the requirements with them before you apply. We will be happy to assist you in any way we can, however please be aware that the decision to transfer credit rests with your home institution.
Current SOAS students selecting this course as an open option module will not be charged the tuition-fee. For further information and assistance, please contact firstname.lastname@example.org.
For more information, please contact us
Venue: Russell Square: College Buildings
Start of programme: 20 July – 7 August 2020
Mode of Attendance: Full-time
- A university student or a graduate at the time of attending the summer school, and 18+ years of age. Professional experience can be acknowledged as equivalent to a university qualification.
- 3 weeks
Tuition Fees 2020
Credit assessed: £1,750