Finance 751 at the University of Auckland Business School is a core postgraduate course typically focusing on advanced corporate finance and investment management. It’s a challenging yet rewarding course designed to equip students with the theoretical knowledge and practical skills needed to excel in the finance industry. The specific content can vary slightly year to year, but generally covers key areas like:
Advanced Corporate Finance: This section delves deeper into corporate financial decision-making than introductory courses. Students often explore topics such as:
- Capital Budgeting: Sophisticated methods for evaluating investment projects, incorporating risk and real options analysis.
- Capital Structure: Analyzing the optimal mix of debt and equity financing for a firm, considering factors like agency costs, taxes, and financial distress.
- Dividend Policy: Examining theories behind dividend payouts and share repurchases, and their impact on firm value.
- Mergers and Acquisitions (M&A): Evaluating M&A strategies, valuation techniques, and post-merger integration challenges.
Investment Management: This part of the course focuses on how investors construct and manage portfolios. Key areas covered may include:
- Portfolio Theory: Understanding the principles of diversification and risk-return trade-offs, including the Capital Asset Pricing Model (CAPM) and Arbitrage Pricing Theory (APT).
- Asset Pricing Models: Exploring different models used to value assets, beyond traditional approaches, and their limitations.
- Fixed Income Securities: Analyzing bond valuation, yield curve analysis, and the impact of interest rate risk.
- Derivatives: Understanding the mechanics and uses of derivatives like options and futures for hedging and speculation.
- Performance Measurement: Evaluating the performance of investment portfolios, considering risk-adjusted returns and benchmark comparisons.
The course typically emphasizes the application of financial theories to real-world scenarios. Students might be expected to:
- Analyze case studies: Examining real company situations and applying financial principles to make recommendations.
- Build financial models: Developing spreadsheet-based models to value companies, assess investment opportunities, and forecast financial performance.
- Conduct research: Undertaking independent research projects on relevant finance topics.
- Participate in class discussions: Actively engaging in debates and sharing insights on course materials.
Finance 751 is crucial for students aiming for careers in investment banking, asset management, corporate finance departments, or financial consulting. The robust analytical skills and in-depth knowledge gained in this course provide a strong foundation for success in these competitive fields. The specific software used might include programs like Excel for financial modeling and potentially specialized statistical software depending on the analytical aspects of the curriculum.
A strong prior understanding of basic finance principles is generally expected, as Finance 751 builds upon these fundamentals to explore more advanced topics. The faculty teaching the course typically comprise experienced academics and industry practitioners, providing students with valuable insights from both theoretical and practical perspectives.