Programme And Module Handbook
 
Course Details in 2023/24 Session


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Module Title LM Risk Management in Financial Markets
SchoolBirmingham Business School
Department Finance
Module Code 07 36913
Module Lead Dr. Anandadeep Mandal
Level Masters Level
Credits 20
Semester Semester 2
Pre-requisites
Co-requisites
Restrictions None
Contact Hours Lecture-30 hours
Seminar-10 hours
Guided independent study-160 hours
Total: 200 hours
Exclusions
Description The global financial markets are evolving rapidly leading to highly sought after critical, analytical and technical skills to manage risks emanating from complex financial instruments. Risk Management in Financial Markets introduces the standard frameworks currently used for risk measurement and management in financial markets with an emphasis on ethical and regulatory guidelines. Throughout, this course spends a significant amount of time on practical applications of theories along with their role in promoting responsible and sustainable businesses, financial systems and economies. First, this course offers an overview of the financial system and its key components, like debt and equity markets, banks, insurance companies, investment firms, rating agencies etc. Subsequently it introduces risk management in context of financial derivatives, in particular forward, futures, options and swaps. Next, it discusses the role of Extreme Value Theory in enhancing our understanding of market and systemic risks. In the context of credit risk it covers ratings based and structural models, as well as credit risk on portfolios and credit derivatives. Finally, this module concludes by offering discussions on risk management in foreign exchange and international money markets. This course also spends a significant amount of time on practical applications of theories using real data from standard databases like Bloomberg, Datastream, Compustat and CRSP among others.
Learning Outcomes By the end of the module students should be able to:
  • Show critically understanding of how the financial system and its key components work in practice.
  • Critically analyse the working mechanism, pricing and application of financial derivatives in hedging financial risk.
  • Critically evaluate the role of Extreme Value Theory in improving our understanding of financial market and its systemic risks.
  • Design risk profiling of credit derivatives using real data from financial databases.
  • Critically evaluate key concepts and ethical practices related to international finance and foreign exchange market.
  • Critically examine international parity conditions, and examine fundamental determinants of exchange rate dynamics using data from financial databases.
  • Detailed understanding of how foreign exchange risks are managed using financial derivatives.
Assessment 36913-01 : Report : Coursework (50%)
36913-02 : Exam : Exam (Centrally Timetabled) - Mixed (50%)
Assessment Methods & Exceptions Main & Reassessment: 2,000 word report (50%) & 2 hour exam (50%).
Students who fail the module resit the failed component(s) only.
Other
Reading List