AI103V Investment Analysis 7,5 hp

Course contents:

Investment process; Capital budgeting; Present value mathematics; Discounted cash flow models; Investment decision making under uncertainty; Investment performances; Leverage; Risk and return on investments.

Course goals;The course should enable students to demonstrate ability to approach investment decision making in a rational and systematic manner by being able to:

• Identify and explain the basic steps in the investment process.
• Derive and understand the origin of the major formulas used in present value calculations.
• Evaluate different investment alternatives.
• Critically assess different investment criteria.
• Show how leverage affects investments.
• Identify major threats to an investment project’s success.
• Explain how risk is defined, list different sources of risk, and how to quantify risk.
• Describe how diversification affects the risk of a portfolio.
• Use decision trees to describe real options imbedded in projects.
• Discuss problems of forecasting.
• Develop Excel spreadsheets for investment decision-making.
• Basically understand portfolio theory, the capital asset pricing model (CAPM) and arbitrage pricing theory (APT).The course should also enable students to work as part of a team of people with different backgrounds.

Prerequisites/eligibility: Completed upper secondary education including documented proficiency in English and 60 university credits of which 15 univeristy credits in Economics.

None

None

Course literature:Brealey, R & Myers, S: Principles of Corporate Finance. McGraw-Hill (latest edition)Geltner, D & Miller, N: Commercial Real Estate Analysis and Investments

När kurs inte längre ges har student möjlighet att examineras under ytterligare två läsår.

• TEN1 - Tentamen, 3,0 hp, betygsskala: A, B, C, D, E, FX, F
• ÖVN1 - Övning, 4,5 hp, betygsskala: P, F

Examinator beslutar, baserat på rekommendation från KTH:s handläggare av stöd till studenter med funktionsnedsättning, om eventuell anpassad examination för studenter med dokumenterad, varaktig funktionsnedsättning.

Examinator får medge annan examinationsform vid omexamination av enstaka studenter.

Course examination: Take-home assignmentsInvestment analysis reportWritten exam

Take-home assignmentsInvestment analysis reportWritten exam

• Vid grupparbete har alla i gruppen ansvar för gruppens arbete.
• Vid examination ska varje student ärligt redovisa hjälp som erhållits och källor som använts.
• Vid muntlig examination ska varje student kunna redogöra för hela uppgiften och hela lösningen.

Gammal kod: 1N1403