Get a basic introduction to the world of finance, from analyzing risk and return and obtaining financing to understanding how markets and banks operate.
Overview
Syllabus
Introduction
- The essence of finance
- Course is not financial investing advice
- The board of directors discuss finance
- Finance inside of companies
- Finance outside of companies
- Introducing financial statements
- Overview of financial statements
- The balance sheet
- The income statement
- The statement of cash flows
- Debt and current ratios
- Return on sales, asset turnover, and ROE
- Price-earnings ratio
- Forecasting financial statements
- Short-term financial management
- The operating cycle
- Cash management
- Managing receivables and inventory
- Obtaining short-term financing
- Understanding internal controls
- Introducing risk and return
- What is risk?
- Why we don’t like risk
- Reducing risk through diversification
- Beta: The concept
- Beta: Examples
- Risk-free rate
- Equity risk premium
- Capital asset pricing model (CAPM)
- Introducing long-term financing
- Does capital structure matter?
- Factors influencing optimal capital structure
- Cost of capital: All debt or all equity financing
- Cost of capital: Split debt-equity financing
- Weighted-average cost of capital
- Introducing securities markets
- The difference between a stock and a bond
- Stock markets
- Bond markets
- Publicly traded shares: What impacts the share price?
- Initial public offering (IPO): Microsoft
- Can you pick stocks in the stock market?
- Introducing financial institutions
- Traditional banks
- Investment banks
- Investment funds: Index funds
- Investment funds: Managed funds, private equity funds, and hedge funds
- Insurance companies
- Introducing capital budgeting
- Capital budgeting overview
- The time value of money
- Example: Buying a car in Hong Kong
- Reviewing corporate finance
Taught by
Jim Stice and Kay Stice