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Finance in the MBA Program
The Master's level finance courses provide an understanding of how companies,
institutions, and individuals make investments, raise capital, and manage risk
in a dynamic financial environment. The investments courses provide rigorous
analytical tools for the measurement of risk-return tradeoffs in financial
markets, the pricing of financial securities, and the allocation of capital in
the financial economy. Corporate finance and institutions classes provide an
understanding of how capital is raised, risk is managed, and companies are
governed in the corporate sector. The finance curriculum also provides
opportunities to better understand ways in which derivative securities can be
used in managing risk in corporations as well as in investment portfolios.
The Master's level finance courses can be taken as individual electives
tailored to student interests or into sequences of electives relevant for career
tracks often chosen by MBA students. For instance, students aspiring to be
financial engineers can take quantitative courses that transform a scientific
understanding of the finance field into mechanisms, products and management
policies that better serve the strategic needs of business entities. Our courses
also include hands-on experience in managing funds. For instance, through the
Mayer Fund, select students obtain hands-on experience in securities analysis
and portfolio management while earning course credit, bridging classroom theory
and actual finance practice.
Career Tracks and Electives
Master's Level Courses
BUSI 640 Financial Management
The finance core. Focuses on the valuation of the real assets of firms, how they
are financed, and the valuation of stocks and bonds, the primary financial
assets in an economy. The core stresses the three conceptual foundations of
valuation: time value of money, no-arbitrage, and systematic risk.
BUFN740 Capital Markets
Designed to deepen the foundations necessary to finance focused students. This a
gateway course that is necessary for those intending to take classes in or
specialize in the quantitative areas of finance including investments, fixed
income, and financial engineering, BUFN 761 to BUFN 770.
BUFN 750, Valuation in Corporate Finance
An advanced topics course in Corporate Finance dealing with valuation. Main topics
will be, building pro forma statements, cost of capital, using ratios and comparables
to value projects and firms, discounted cash flow valuations, WACC and APV methods
of valuation and Real Option Valuations.
BUFN751 Financial Strategy For Corporations
An advanced course in corporate finance, focusing on the issues that firms face
when they plan to raise external capital from financial markets. The focus is on
the financing problems faced by mid-market to large firms and on capital raised
from public markets. The forms of external finance vary from simple debt or
equity to more complex securities that bundle financing with an element of risk
management.
BUFN 752, Financial Restructuring
Focuses on identifying ways to increase firm value through corporate restructuring.
Specific topics include: mergers and tender offers, spin-offs, carve-outs, divestitures,
takeover defense strategies, leveraged buy-outs, and international acquisitions.
Additionally, the theory, practice and empirical evidence related to each of these
topics will be covered. Emphasis will be placed on valuation analysis and strategic
considerations.
BUFN 753, Corporate Governance
Deals with corporate governance and its impact on shareholder value. Divergence
of interests between corporate insiders and providers of funds leads to agency problems
which can impair corporate performance and shareholder value. Various instruments
of corporate governance - internal as well as external mechanisms - that can help
align managerial incentives with those of outside investors, and hence help restore
shareholder value will be studied.
BUFN 754, Corporate Risk Management
Surveys the theory and practice of financial risk identification, measurement, and
mitigation at financial and non-financial firms. Topics will include hedging with
options and futures, interest rate risk management, Value-at-Risk (VaR), Cashflow-at-Risk
(CaR), Earnings-at-Risk (EaR), credit risk, equity risk, commodities risk, exchange
rate risk, and lessons from risk management disasters.
BUFN755 Entrepreneurial Finance and Private Equity
An advanced topics course in Corporate Finance. The major emphasis is how
financiers help growing firms - and in particular young start-ups - using
different types of securities at different points in the industry's and firm's
life. Financing arrangements and securities studied will include private equity
funds and private financings placements, venture capital and preferred equity,
investment banks through initial public offerings, private equity funds, debt
and leveraged buyouts. Students will learn additional techniques that will help
them understand how financiers value firms and how to understand, plan and value
different financing strategies.
BUFN 760, Applied Equity Analysis
Students will learn to analyze equity securities using the basic EIC (Economy/Industry/Company)
framework used in the financial industry, paying special attention to financial
statement analysis. Students also will learn the primary valuation techniques used
to estimate market values for equity securities.
BUFN 761, Derivative Securities
Standard types of derivatives contracts are presented, and illustrated as to how
they are used in practice. The theory of pricing these contracts is then presented
in detail. The use of static and dynamic replication strategies, and the concept
of no-arbitrage strategies is illustrated in numerous ways. Standard valuation techniques
are covered, and standard formulas are presented. The theory is then applied to
develop specific pricing and hedging strategies for various types of derivatives
on different underlying assets. The management of the exposure of various risks
is covered in detail as well.
BUFN 762, Fixed Income Analysis
Describes important financial instruments which have market values that are sensitive
to interest rate movements. Develops tools to analyze interest rate sensitivity
and value fixed income securities. Defines and explains the vocabulary of the bond
management business.
BUFN 763, Portfolio Management
Provides training that is important in understanding the investment process - the
buy side of the financial world. Specifically, the objective is to provide graduate-level
instruction in the following topics, both in theory and in using financial markets
data to test the basic theory and practice of portfolio choice and equilibrium pricing
models and their implications for efficient portfolios.
BUFN 765, Fixed Income Derivatives
Surveys fixed income assets and related securities such as Exchange-traded bond
options; bonds with embedded options; floating rate notes; caps, collars, and floors;
floating rate notes with embedded options. Also surveys advanced tools for interest-rate
and fixed-income portfolio management, including the use of derivative securities,
and the application of binomial trees for analysis of options, and a sound understanding
of stochastic yield curves.
BUFN 766, Financial Engineering
Develop Excel and Visual Basic (VBA) models to solve problems related to portfolio
management, options valuation, fixed income securities, interest rate processes,
and risk management. This course thus bridges theory with the design of algorithms
and models that can be directly applied in practice.
BUFN 770, International Investment
Addresses international stock markets, portfolio theory, international interest
rates, exchange rates and exchange rate derivatives (options, forwards, and futures),
exchange rate swaps and exchange rate exposure (operating, translation, and transaction),
foreign investment strategy.
BUFN 771, International Corporate and Project Finance
Issues addressed will include capital budgeting, project financing, exchange rate
exposure (operating, translation, and transaction), foreign investment strategy,
and risk management.
BUFN 772, Bank Management
Analyze and discuss readings in bank management, with primary focus on the measurement
and management of risk, including credit, market, and interest rate risk. Look at
the management of liquid reserves. Examine the special nature of financial institutions,
incorporating their functions, policies, services, and regulation. Study the evolving
nature of the financial services industry, by reading the financial press and by
having outside practitioner speakers. Focus is on U.S. banks.
BUFN 773, Institutional Asset Management
Examines how money is managed by organizations such as university endowments, pension
funds, mutual funds, hedge funds, and private equity funds. Involves a mixture of
finance and economics and emphasizes the incentives professional money managers
face within the context of the organizational structure in which they operate. Particular
attention is paid to compensation structures and monitoring mechanisms.
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