Advanced Financial Management(LFM 511)
| Course Code | Course Name | Semester | Theory | Practice | Lab | Credit | ECTS |
|---|---|---|---|---|---|---|---|
| LFM 511 | Advanced Financial Management | 1 | 3 | 0 | 0 | 3 | 6 |
| Prerequisites | |
| Admission Requirements |
| Language of Instruction | English |
| Course Type | Compulsory |
| Course Level | Masters Degree |
| Course Instructor(s) | E. Ertuğrul KARSAK ekarsak@gsu.edu.tr (Email) |
| Assistant | |
| Objective | The objective of the course is to review the fundamental concepts and techniques of financial management such as financial planning, valuation of corporate securities, capital budgeting, portfolio theory, and financial derivatives. A basic knowledge of these techniques is essential for proper decision making and improving the financial performance of firms. |
| Content |
- Overview of financial statements - Sources and uses statement - Cash flow statement - Inflation and the assessment of company performance - Financial ratio analysis - Liquidity ratios - Asset management ratios - Debt management ratios - Profitability ratios - Market value ratios - Du Pont system - Uses and limitations of ratio analysis - Financial forecasting - The percentage of sales method - Financial planning - Breakeven analysis - Degree of operating leverage - Degree of financial leverage - Degree of total leverage - Time value of money - Risk and rates of return - Defining and measuring risk - Relationship between risk and rates of return - Diversification and portfolio risk - Markowitz portfolio selection model - Capital asset pricing model (CAPM) - Basics of arbitrage pricing theory (APT) - Global Bond Markets - Bond and stock valuation - Bond valuation - Common stock valuation - Methods of portfolio performance evaluation - Capital budgeting techniques - Cost of capital - Value at risk (VaR) - Introduction to financial derivatives - Basics of options markets - Option contract - Call options - Put options - Option strategies - Fundamentals of option valuation |
| Course Learning Outcomes | |
| Teaching and Learning Methods | Lectures, problem sessions, discussion. |
| References |
Weston, J.F., Brigham, E.F., Essentials of Managerial Finance, Ninth Edition, The Dryden Press, 1990. Zutter, C.J., Smart, S.B., Principles of Managerial Finance, Fifteenth edition, Pearson, 2019. |
Theory Topics
| Week | Weekly Contents |
|---|---|
| 1 | Introduction and organization, Overview of financial statements. |
| 2 | Sources and uses statement, Cash flow statement, Inflation and the assessment of company performance. |
| 3 | Financial ratio analysis: Liquidity ratios, Asset management ratios, Debt management ratios, Profitability ratios, Market value ratios, Du Pont system, Uses and limitations of ratio analysis. |
| 4 | Financial forecasting, The percentage of sales method, Financial planning, Breakeven analysis, Degree of operating leverage, Degree of financial leverage, Degree of total leverage. |
| 5 | Time value of money, Risk and rates of return: Defining and measuring risk, Relationship between risk and rates of return, Diversification and portfolio risk. |
| 6 | Markowitz portfolio selection model. |
| 7 | Capital asset pricing model (CAPM), Basics of arbitrage pricing theory (APT), Global bond markets. |
| 8 | Midterm Exam |
| 9 | Bond and stock valuation: Bond valuation, Common stock valuation |
| 10 | Methods of portfolio performance evaluation, Capital budgeting techniques. |
| 11 | Cost of capital, Value at risk (VaR). |
| 12 | Introduction to financial derivatives, Basics of options markets: Option contract, Call options, Put options, Option strategies. |
| 13 | Fundamentals of option valuation. |
| 14 | Project presentations. |
Practice Topics
| Week | Weekly Contents |
|---|---|
| 1 | |
| 2 | |
| 3 | |
| 4 | |
| 5 | |
| 6 | |
| 7 | |
| 8 | |
| 9 | |
| 10 | |
| 11 | |
| 12 | |
| 13 | |
| 14 |
Contribution to Overall Grade
| Number | Contribution | |
|---|---|---|
| Contribution of in-term studies to overall grade | 2 | 50 |
| Contribution of final exam to overall grade | 1 | 50 |
| Toplam | 3 | 100 |
In-Term Studies
| Number | Contribution | |
|---|---|---|
| Assignments | 0 | 0 |
| Presentation | 0 | 0 |
| Midterm Examinations (including preparation) | 1 | 30 |
| Project | 1 | 20 |
| Laboratory | 0 | 0 |
| Other Applications | 0 | 0 |
| Quiz | 0 | 0 |
| Term Paper/ Project | 0 | 0 |
| Portfolio Study | 0 | 0 |
| Reports | 0 | 0 |
| Learning Diary | 0 | 0 |
| Thesis/ Project | 0 | 0 |
| Seminar | 0 | 0 |
| Other | 0 | 0 |
| Toplam | 2 | 50 |
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| 1 | 2 | 3 | 4 | 5 | ||
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| Activities | Number | Period | Total Workload |
|---|---|---|---|
| Class Hours | 13 | 3 | 39 |
| Working Hours out of Class | 13 | 2 | 26 |
| Presentation | 1 | 5 | 5 |
| Midterm Examinations (including preparation) | 1 | 20 | 20 |
| Project | 1 | 25 | 25 |
| Final Examinations (including preparation) | 1 | 25 | 25 |
| Total Workload | 140 | ||
| Total Workload / 25 | 5.60 | ||
| Credits ECTS | 6 | ||