Financial Modelling

Module code: MN7024

Module co-ordinator: Dr Alexandra Dias

Module Outline

This module explores the use of quantitative techniques to analyse financial information and to assist decision-making through the use of descriptive statistics, probability and probability distributions; statistical inference; regression analysis and time series analysis.

After completing this module students will be able to:

  1. Define and compute descriptive statistics and make graphs of financial data.
  2. Summarise financial information in a format useful for decision making.
  3. Recognise the most common families of probabilistic distributions used in financial modelling and estimate its parameters from financial data.
  4. Describe and fit models as multiple linear regression, using R or a comparable statistical programme.
  5. Perform inference and related tests of hypothesis on the basis of empirical financial data.
  6. Construct, modify, and compare quantitative models. Select the best model to answer the question of interest taking into account the empirical data available.
  7. Give financial interpretation to results obtained from modelling and recognise its limitations.  
  8. Evaluate quantitative analysis undertaken by others.

Learning

  • 20 one-hour lectures
  • 2 one-hour seminars

Assessment

  • Assignment (100%)