Finance 338: Investments – UNL

Finance 338, Investments, at the University of Nebraska-Lincoln (UNL) provides a comprehensive introduction to the principles and practices of investment management. This course equips students with the foundational knowledge needed to understand, analyze, and make informed investment decisions across various asset classes.

Course Content

The curriculum typically covers a broad range of topics, including:

• The Investment Environment: An overview of financial markets, securities exchanges, and regulatory frameworks. This section establishes the groundwork for understanding how investments are traded and regulated.
• Security Valuation: Students learn techniques for valuing stocks, bonds, and other financial instruments. This involves analyzing financial statements, understanding discounted cash flow models, and assessing risk factors.
• Portfolio Theory and Management: The course explores concepts like diversification, asset allocation, and portfolio optimization. Students learn how to construct portfolios that meet specific investment objectives and risk tolerances.
• Risk and Return: Understanding the relationship between risk and return is central to the course. Students learn about various risk measures, such as standard deviation and beta, and how they relate to expected returns.
• Derivatives: An introduction to derivatives, such as options and futures, and their use in hedging and speculation. This section explores the mechanics of these instruments and their potential applications.
• Market Efficiency: A critical examination of the efficient market hypothesis and its implications for investment strategies. Students learn about different forms of market efficiency (weak, semi-strong, and strong) and the evidence supporting or refuting them.
• Behavioral Finance: Explores the psychological biases that can influence investment decisions and lead to market anomalies. This section delves into how cognitive biases can impact investor behavior.

Learning Outcomes

Upon successful completion of Finance 338, students should be able to:

• Understand the structure and function of financial markets.
• Value stocks, bonds, and other assets using various valuation techniques.
• Construct and manage investment portfolios based on established investment principles.
• Assess and manage investment risk.
• Apply financial models to analyze investment opportunities.
• Critically evaluate investment strategies and recommendations.

Course Structure

The course typically involves a combination of lectures, readings, problem sets, and potentially case studies or simulations. Exams are generally used to assess students’ understanding of the core concepts, while projects may require them to apply these concepts to real-world investment scenarios.

Prerequisites

Students typically need to have completed introductory finance courses, such as Finance 301 (Principles of Finance), or equivalent, before enrolling in Finance 338. A strong foundation in accounting and quantitative methods is also beneficial.

Career Relevance

Finance 338 is a valuable course for students interested in pursuing careers in investment management, financial analysis, portfolio management, wealth management, and related fields. The knowledge and skills gained in this course provide a strong foundation for further study and professional development in the financial industry.