Investment Analysis

Course Code :1303TEWSBF
Study domain:Finance
Academic year:2019-2020
Semester:1st semester
Contact hours:45
Credits:6
Study load (hours):168
Contract restrictions: No contract restriction
Language of instruction:English
Exam period:exam in the 1st semester
Lecturer(s)Jan Annaert

3. Course contents *

In this course, an overview is given of the different techniques that can help the investors to compose their investment portfolio, to analyse potential investment assets and to evaluate ex post their investment decisions (or those of others). In teaching these concepts, the perspective of the institutional investor is taken (e.g. insurance company, investment company, mutual fund). We divide the investment process into three steps:

  • Asset allocation” step: how are long term investment goals formulated and how do they lead to a subdivision of the portfolio into the large asset categories (e.g. equity, bonds, cash). In this step, the macro-economic context is predominantly present.
  • Security selection” step: given the asset allocation decision, how do we fill in these categories withn individual assets: which bonds do we buy, from which companies do we buy stocks,… ? It goes without saying that to answer these questions, we need some techniques and concepts to be able to value bonds and stocks. Also options and futures need to be understood as they offer additional investment opportunities or hedging possibilities.
  • Evaluation step: after having constructed an investment portfolio, it is equally important to regularly evaluate to what extent these decisions a) conform to the investment goals; and b) yield the desired results. The techniques to answer these questions are dealt with in this part of the course.