This unit provides an overview of investment and risk, and proposes strategies to manage the risks of different investment practices. Students will discriminate between different types of risks encountered by contemporary organisations and investigate models designed to help manage those risks. Students will apply statistics to assess distribution of asset returns, measure risk, measure the components of total risk, measure the risk in portfolio construction and management, the efficient market concept, option pricing models and forecast volatility.
Unit details
Location:
Study level:
Undergraduate
Credit points:
12
Unit code:
BEO3000
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Learning Outcomes
| 1. | Deliberate upon the distribution of asset return and the measurement of risk, to substantiate conclusions tailored to meet the requirements of a range of sectors/settings; | ||
| 2. | Quantify the relationship between returns and different types of risk to value the asset and provide justified recommendations; | ||
| 3. | Contextualise the concepts of market efficiency and random walk hypothesis clearly and coherently as they are evidenced in contemporary settings; | ||
| 4. | Create an optimum portfolio based on the risk and correlation of individual assets to provide diversification benefits; | ||
| 5. | Adapt the principles of options and option pricing models to analyse and justify recommendations for effective financial decision making for known and changing contexts; and | ||
| 6. | Estimate and forecast volatility in financial time-series, justifying an optimal recommendation. |
Assessment
Melbourne campuses
Students studying under the VU Block Model.
| Assessment type | Description | Grade |
|---|---|---|
| Assignment | Group Assignment 1 | 20% |
| Assignment | Group Assignment 2 | 20% |
| Assignment | Group Assignment 3 | 20% |
| Test | Online Test | 40% |
Other locations
| Assessment type | Description | Grade |
|---|---|---|
| Test | Multiple Choice and Short Answers | 20% |
| Assignment | Assignment | 20% |
| Examination | Final Examination | 60% |
Required reading
Quantitative financial risk management.
Miller, M. B. (2019).
Hoboken, New Jersey: John Wiley & Sons, Inc. (Wiley finance series).
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