CORPFIN 3501 - Portfolio Theory & Management III

North Terrace Campus - Semester 1 - 2018

This course is an in-depth study of investment portfolios: the theory behind them, construction techniques, asset classes employed and its management. Asset classes examined in the context of portfolio construction will include Equities (both developed and emerging markets), Fixed Income Securities, Commodities, Real Estate, and Alternate Investments. Course participants will revisit and enhance their knowledge of the theoretical foundations of asset pricing, market efficiency and the Modern Portfolio Theory (MPT). Course participants will then develop an Investment Policy Statement (or a Statement of Advice) for an institutional investor, quantitatively forecast characteristics of various asset classes in an economy, and then create an investment portfolio to satisfy the investment requirements. Students will learn various strategies to test the portfolio constructed, issues that impact portfolio performance in achieving investment objectives, and finally evaluate its performance.

  • General Course Information
    Course Details
    Course Code CORPFIN 3501
    Course Portfolio Theory & Management III
    Coordinating Unit Business School
    Term Semester 1
    Level Undergraduate
    Location/s North Terrace Campus
    Units 3
    Contact Up to 3 hours per week
    Available for Study Abroad and Exchange Y
    Prerequisites CORPFIN 2502
    Assumed Knowledge SACE Stage 2 Mathematical Studies
    Course Description This course is an in-depth study of investment portfolios: the theory behind them, construction techniques, asset classes employed and its management. Asset classes examined in the context of portfolio construction will include Equities (both developed and emerging markets), Fixed Income Securities, Commodities, Real Estate, and Alternate Investments. Course participants will revisit and enhance their knowledge of the theoretical foundations of asset pricing, market efficiency and the Modern Portfolio Theory (MPT). Course participants will then develop an Investment Policy Statement (or a Statement of Advice) for an institutional investor, quantitatively forecast characteristics of various asset classes in an economy, and then create an investment portfolio to satisfy the investment requirements. Students will learn various strategies to test the portfolio constructed, issues that impact portfolio performance in achieving investment objectives, and finally evaluate its performance.
    Course Staff

    Course Coordinator: Dr Syed Zamin Ali

    Course Timetable

    The full timetable of all activities for this course can be accessed from Course Planner.

  • Learning Outcomes
    Course Learning Outcomes
    On successful completion of this course, students will be able to:

    1. Explain Modern Portfolio Theory and the Mean-Variance Framework.

    2. Create an Investment Portfolio and test its ability to achieve Investment Objectives

    3. Analyse Core Asset classes (Equities and Fixed Income Securities) based on their characteristics and performance over economic and business cycles.

    4. Evaluate Non-Core Asset classes and Alternative Investments, and their relationship with Core Asset classes in a portfolio setting.

    5. Understand issues in portfolio construction, its management and its performance.

    University Graduate Attributes

    This course will provide students with an opportunity to develop the Graduate Attribute(s) specified below:

    University Graduate Attribute Course Learning Outcome(s)
    Deep discipline knowledge
    • informed and infused by cutting edge research, scaffolded throughout their program of studies
    • acquired from personal interaction with research active educators, from year 1
    • accredited or validated against national or international standards (for relevant programs)
    1-5
    Critical thinking and problem solving
    • steeped in research methods and rigor
    • based on empirical evidence and the scientific approach to knowledge development
    • demonstrated through appropriate and relevant assessment
    1-5
    Teamwork and communication skills
    • developed from, with, and via the SGDE
    • honed through assessment and practice throughout the program of studies
    • encouraged and valued in all aspects of learning
    1-5
    Career and leadership readiness
    • technology savvy
    • professional and, where relevant, fully accredited
    • forward thinking and well informed
    • tested and validated by work based experiences
    1-5
    Intercultural and ethical competency
    • adept at operating in other cultures
    • comfortable with different nationalities and social contexts
    • Able to determine and contribute to desirable social outcomes
    • demonstrated by study abroad or with an understanding of indigenous knowledges
    1-5
    Self-awareness and emotional intelligence
    • a capacity for self-reflection and a willingness to engage in self-appraisal
    • open to objective and constructive feedback from supervisors and peers
    • able to negotiate difficult social situations, defuse conflict and engage positively in purposeful debate
    1-5
  • Learning Resources
    Required Resources
    Running Money: Professional Portfolio Management
    by Stewart, S. D., Prios, C. D., and  J. C. Heisler, 1st Edition, published by McGraw-Hill

    Other readings from academic, semi-professional and professional sources.
    Recommended Resources

    Students are encouraged to stay abreast of global financial issues. The Australian Financial Review and finance commentary on the ABC Australia, Bloomberg and CNBC networks are excellent sources of current financial news and should be referred to on a regular basis. The internet is also abundantly populated with all aspects of this course, and should be used as well.

    Students will use the Thomson Reuters EIKON database to access capital market data.

    Online Learning

    Discussion board will be the primary source of interface between students and the academic staff and issues raised will be answered within 2 working days.

    Emails will be responded to only on Mondays and should be used for personal issues.

    For urgent matters, please see the lecturer (Dr. Syed Ali) during:

    (i)   Consultation hours - Walkin (Tuesdays 12-1pm only)

    (ii)   By Appointment only (Tuesdays and Thursdays only)

    (iii)  During the lecture break.

     
    Lecture material such as presentation, articles, tutorial questions and lecture recording will be available on MyUni. Brief tutorial answers will also be made available in the week following the tutorial.

  • Learning & Teaching Activities
    Learning & Teaching Modes
    The approach in this course is to first establish the theoretical foundations and then to build upon these to understand portfolio construction, implementation and management for an investor. This will be done through lectures, tutorials, a test, a group assignment, and a final examination.

    Workload

    The information below is provided as a guide to assist students in engaging appropriately with the course requirements.

    The University expects full-time students (i.e. those taking 12 units per semester) to devote a total of 48 hours per week to their studies. This means that you are expected to commit approximately 9 hours for a three-unit course of private study outside of your regular classes.

    Students in this course are expected to attend all lectures throughout the semester plus one tutorial class each week. If a student is unable to attend a lecture, it is the student's responsibility to watch the lecture recording prior to attending the tutorial. The student must allocate atleast 2 hours for this activity on a weekly basis.
    Learning Activities Summary

    Week 1: Introduction

    Week 2: Client Objectives for a Diversified Portfolio

    Week 3: Theory of Asset Allocation - Mean Variance Framework

    Week 4: Practical Asset Allocation 1 - Portfolio Construction

    Week 5: Practical Asset Allocation 2 - Scenario and Stress Testing

    Week 6: Using the Thomson Reuters EIKON database

    Week 7: Equity Investing

    Week 8: Fixed Income Securities Investing

    Week 9: Global Investing

    Week 10: Alternative Investments

    Week 11: Performance Measurement

    Week 12: Review

    Specific Course Requirements
    This course draws upon previous knowledge from Business Finance I and Business Valuation II. Students must have passed both courses to be sucessful in this course. Additionally, students may need to review both courses if they have scored only a "Pass" in either of these two courses.

    This course is a single pass course. Successful completion of this course will require students to keep up to date with the assigned material. This means that students should have had browsed the assigned chapter and the power point presentation for that topic (Details of each topic is avilable in MyUni) prior to attending the lecture. Students should review the lecture recordings and get better understanding by reading the assigned chapter after the lecture to prepare for the tutorial. It is expected that students would have prepared the tutorial questions prior to attending their assigned tuitorial class. This will allow students to have a deeper understanding of the topic and have a healthy discussion in the tutorial class. Brief tutorial answers will also be made available in the week following the tutorial week.

    This course includes a group assignment. Group assignments can be completed in groups of 2 top 4 students, and no groups can have more than 4 students. Group assignments allow students to be able to create a solution to an assigned problem and test their solution using quantitative and qualitative methodologies. It is expected that each member of a group will be able to leverage of their own particular expertise as well as that of the other members in the group. Groups will be created by the students themselves and groups may discuss their assignment with tutors during assignment consultation by making appointments.

    Finally, this course will include students to be able to access historical capital market data usuing IKON database. for their assignment.
    Small Group Discovery Experience
    This course does not feature Small Group Discovery Experience.
  • Assessment

    The University's policy on Assessment for Coursework Programs is based on the following four principles:

    1. Assessment must encourage and reinforce learning.
    2. Assessment must enable robust and fair judgements about student performance.
    3. Assessment practices must be fair and equitable to students and give them the opportunity to demonstrate what they have learned.
    4. Assessment must maintain academic standards.

    Assessment Summary

    Assessment Weighting Due Date Course Learning Outcome
    Test 20% Week 6 1 & 2
    Thomson Reuters EIKON database 10% Week 7-8 2, 3, 4 and 5
    Group Assignment 20% Week 11 All
    Final Examination 50% Exam Period All
    Assessment Related Requirements
    The approach in this course is to first establish the theoretical foundations and then to build upon these to understand portfolio construction, implementation and management for an institutional investor. This will be done through lectures, tutorials, a test, a group assignment, and a final examination. Tests and Final/Replacement examination will be closed book (no reference material allowed). Assessments from previous semester(s) cannot be redeemed.

    This course will feature a group assignment and will require the ability to access the Thomson Reuters Eikon Databse.
    Assessment Detail
    The assessment components are as follows:

    · (20%) Test: I hour MCQ (Multiple Choice Questions) test. This is a closed book test

    · (10%) IKON database related learning activities

    . (20%) Group Assignment

    · (50%) Final/Replacement Exam: 3 hours exam as per examination schedule. These are closed book examination
    Submission
    Further details will be provided on MyUni.
    Course Grading

    Grades for your performance in this course will be awarded in accordance with the following scheme:

    M10 (Coursework Mark Scheme)
    Grade Mark Description
    FNS   Fail No Submission
    F 1-49 Fail
    P 50-64 Pass
    C 65-74 Credit
    D 75-84 Distinction
    HD 85-100 High Distinction
    CN   Continuing
    NFE   No Formal Examination
    RP   Result Pending

    Further details of the grades/results can be obtained from Examinations.

    Grade Descriptors are available which provide a general guide to the standard of work that is expected at each grade level. More information at Assessment for Coursework Programs.

    Final results for this course will be made available through Access Adelaide.

  • Student Feedback

    The University places a high priority on approaches to learning and teaching that enhance the student experience. Feedback is sought from students in a variety of ways including on-going engagement with staff, the use of online discussion boards and the use of Student Experience of Learning and Teaching (SELT) surveys as well as GOS surveys and Program reviews.

    SELTs are an important source of information to inform individual teaching practice, decisions about teaching duties, and course and program curriculum design. They enable the University to assess how effectively its learning environments and teaching practices facilitate student engagement and learning outcomes. Under the current SELT Policy (http://www.adelaide.edu.au/policies/101/) course SELTs are mandated and must be conducted at the conclusion of each term/semester/trimester for every course offering. Feedback on issues raised through course SELT surveys is made available to enrolled students through various resources (e.g. MyUni). In addition aggregated course SELT data is available.

  • Student Support
  • Policies & Guidelines
  • Fraud Awareness

    Students are reminded that in order to maintain the academic integrity of all programs and courses, the university has a zero-tolerance approach to students offering money or significant value goods or services to any staff member who is involved in their teaching or assessment. Students offering lecturers or tutors or professional staff anything more than a small token of appreciation is totally unacceptable, in any circumstances. Staff members are obliged to report all such incidents to their supervisor/manager, who will refer them for action under the university's student’s disciplinary procedures.

The University of Adelaide is committed to regular reviews of the courses and programs it offers to students. The University of Adelaide therefore reserves the right to discontinue or vary programs and courses without notice. Please read the important information contained in the disclaimer.