BU473 Winter 2013

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BUSINESS 473: Investment Management

Section C - Winter 2013
Name Instructor: Michelle Lennox (Email: mlennox@wlu.ca) Jennifer Ferfolja By appointment only MyLearningSpace (MLS) Office N/A Phone Email please

Faculty Assistant: Office Hours: Course Website: Prerequisites:

SBE 2201

519 884-0710 Ext. 2062

BU393, Financial Management II Textbook: Investment Analysis and Portfolio Management, First Canadian Edition. Reilly, Brown, Hedges, Chang; Nelson Education, 2010. Course Website: All course materials slides, course information and announcements, midterm, etc. are available on MyLS. Additional Course Materials: Nelson Education provides additional notes and study exercises at the on-line student centre. This website is: www.reilly.nelson.com Course Description: This investments course is designed to help students understand the investment opportunities in the capital markets and the risk-return relationship of securities usually included in investment portfolios.

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The bond market, stock market, portfolio analysis, mutual funds, as well as market efficiency are the focus of this course. Some financial derivative securities, for example, options and stock index futures, which are used for hedging against market risk, will be introduced in the course to help students hedge their simulation portfolios. The course will also cover investment risk, trading strategies and technical analysis. Students will undertake a stock market competition on Rotman Interactive Trader platform for 8 weeks starting January 28, 2013 and ending March 22, 2013. A 15-page report on their trading strategies and portfolio performance will need to be prepared and submitted no later than the beginning of class on Thursday, April 4, 2013 at 7pm in class. Additional information regarding the Trading Simulation will be posted to MyLearningSpace. Teaching Method: Lectures and discussion of solutions to in-class examples will comprise the primary teaching methods employed in this course. Students are encouraged to use relevant end-of-chapter problems in the text as extra practice. Grading Schemes: Take Home Midterm Trading Report (15% performance + 15% report) Final Examination 30% 30% 40% 100% Key Dates January 28 March 7 March 22 April 4 Group Work: Students will form groups to trade in securities and manage their portfolio in the stock market competition. Each group would comprise no more than 5 students. The group will be assigned one access code which they will use to place their trading orders. Both the group members are responsible for their trading decisions as well as the preparation of the final trading report. The same group will be responsible for the take-home midterm examination. For the mid-term, each group will submit one set of solutions and the members of the group will be assigned the same mark that the group earns. I expect the students in each group to participate and share the assignment burden equally. If there are any problems within a group, the members should inform me before the group assignment hand-in (not after grading). Though there will not be within group variation in assignment of marks, any student who fails to fully participate and co-operate with the group members in either the stock market simulation or take-home midterm will be assigned only one-half Trading simulation starts Take-home midterm due at the beginning of class Trading simulation ends Trading report due (can submit earlier)

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of the mark earned by the group. INDIVIDUAL MIDTERMS AND TRADING REPORTS WILL NOT BE ACCEPTED. Exams: There is no deferred mid-term and given that the mid-term is a take home completed in groups, no exceptions will be made. If a midterm is not submitted, a grade of zero will be assigned. The date of the final examination is yet to be determined. The final exam will be comprehensive, i.e., its coverage being the entire course, with somewhat more emphasis on topics not covered in the midterm exam. For the final exam, students will be allowed to bring in one cheat sheet, 8.5 x 11, double sided with anything (e.g. formulae, examples, etc) on it. Cheat sheets must be labelled with student name and ID and must be handed in with the exam. Students will need to bring a calculator to the exam. The final exam questions will be a mixture of multiple choice and detailed problems. Detailed problems will be similar to the questions undertaken in class and those assigned from the textbook. Academic Accommodation: Students requiring academic accommodations are advised to contact the Accessible Learning Centre for information regarding services and resources. Students are encouraged to review the Calendar for information regarding all services available on campus. Academic Misconduct and Sanctions: Academic misconduct is an act by a student, or by students working on a team project, which may result in a false evaluation of the student(s), or which represents a deliberate attempt to unfairly gain an academic advantage. Academic misconduct includes, but is not limited to, the following acts which are presented as examples or a guide since not every possible circumstance can be anticipated: 1. Plagiarism, which is the unacknowledged presentation, in whole or in part, of the work of others as one's own, whether in written, oral or other form, in an examination, report, assignment, thesis or dissertation; 2. Cheating, which involves the using, giving, receiving, or the attempt to use, give or receive unauthorized information during an examination in oral, written or other form; or, copying an essay, examination or report, or allowing someone else to copy one's essay, examination or report; 3. Submitting the same piece of work, or a significant part thereof, for more than one course without the permission of the instructors involved in each course; 4. Impersonating another person in an examination or test; 5. Buying or otherwise obtaining term papers or assignments for submission of another person's work as one's own for evaluation;

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6. Falsifying, misrepresenting or forging an academic record or supporting document. Sanctions are levied by the University and their severity is determined in relation to the degree of academic or research dishonesty committed or attempted, to the intention to commit dishonest acts, or to the degree to which an individual has been a party to attempted or committed acts of dishonesty. Penalties may include, but are not limited to, the following: a requirement to repeat the assignment, examination or course; failure on the assignment, course, examination, thesis or dissertation; suspension from the program or from the University for a designated period of time; expulsion from the program or from the University.

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CLASS SCHEDULE - WINTER 2013 Thursday Evening Classes P 3007 Please note that the schedule below is only a rough guideline. I may go slower or faster and may have to adjust the schedule based on the actual progress of the class. Lecture slides will be posted no later than 11:59pm on the Tuesday preceding the scheduled class. The timing of the guest speaker may change subject to their availability.

Class 1

Date Thurs, Jan 10

Topic Course Outline, Market history, Investment alternatives, Taxation of Investment Income in Canada, Review of Risk & Return Asset Allocation, Selecting Investments, Security Markets and the Economy Efficient Markets, Portfolio Management and Theory

Text Chapter 1

Thurs, Jan 17

2, 3, 4

Thurs, Jan 24

5, 6, 6A(part c only), 7

Thurs, Jan 31

Security Analysis Economy, Industry, Company, Technical Analysis

8, 9, 10

Thurs, Feb 7

Guest Speaker Hedge Funds

Thurs, Feb 14

Analysis of Financial Statements, Introduction to Security Analysis

Web Chapters 19, 20

Feb 18-22

Reading Week, No Classes

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Class 7

Date Thurs, Feb 28

Topic Analysis and Management of Bonds

Text Chapter 11, 12, 12A

Thurs, Mar 7

Take Home Midterms DUE at Beginning of Class

Thurs, Mar 7

Derivatives

13, 14

Thurs, Mar 14

Portfolio Management Equity and Bonds

15, 16, 16A

10

Thurs, Mar 21

Investment Funds

17

11

Thurs, Mar 28

Investment Performance

18

12

Thurs, Apr 4

International Investing

Lecture Slides and material posted on MyLS

13

Thurs, Apr 4

Trading Reports Due