Foundations of Financial Analysis and Investment

Module code: MN7561

This module will enable you to establish and critique the essential conceptual and ethical frameworks that lie at the foundations of modern financial analysis. It will allow you to explore the mutual interactions between ‘finance’ and the financial markets, on the one hand, and the so-called fundamentals, on the other. The module draws upon various disciplines, in particular economics and political economy, in order to explore parts of the package of conceptual tools employed by financial managers who have to provide information across a variety of topics. Emphasis is placed upon risk and uncertainty and, more broadly, upon the sociopolitical, cultural and economic environment in which financial decisions are made.

Topics covered

• Nature of and role played by financial markets and financial intermediaries.
• Characteristics of the various forms of financial assets debt, equity, currencies, commodities and derivatives.
• Determinants of savings; investment and interest rates.
• Mutual interaction between the financial markets and the ‘real’ economy.
• Principles underlying the pricing of financial assets/instruments.
• Key issues, debates and controversies in finance, such as those concerning the efficiency of financial markets and whether financial markets are stabilising or destabilising.
• Possible causes of economic and financial crisis.