Gerald A. Hanweck, Professor of Finance
Office hours: Before Class, Wednesdays after 4:30 p.m. or by appointment.
Office: Enterprise Hall, 232E Phone: 993-1855 Fax: 993-1809
Email: ghanweck@som.gmu.edu
Website: http://gbi-sba.gmu.edu/sba/fnan731.htm
| Consider this syllabus an agreement. There are no
"extra credit" assignments. Unless otherwise
stated, students are responsible for all text material,
whether covered in class or not. Class notes are the
students' responsibility. Absences are treated consistent with University policy. Conflicts due to professional commitments must be indicated in advance; obligations will be due on or prior to original due dates. Makeup exams will only be given by prior arrangement or in case of a significant illness. Any University cancellation of class will result in the assignment or obligation being due the next scheduled class meeting. |
| Required Texts: | Frank J. Fabozzi and Franco Modigliani, Capital
Markets: Institutions and Instruments, 2nd
edition, Prentice Hall, Inc., 1995. Van Horne, James C., Financial Markets Rates and Flows, 5th edition, Prentice Hall, Inc., New Jersey, 1998. Cook, Timothy Q. and Robert K. LaRoche, editors, Instruments of the Money Market, 7th edition, Federal Reserve Bank of Richmond, Richmond, Virginia, 1993. |
| Recommended: | Wall Street Journal (Highly Recommended), Business Week, The Economist, Fortune, Financial Times, American Banker |
| Outside Reading: | Web sources as indicated. Outside assignments will be announced in class and made available in class or at the Copy Center. |
| Honor Code: | Students are expected to follow the honor code as presented in the University's Undergraduate Catalog. |
| Grading: | |
| Midterm Examination | 30 percent |
| Final Examination | 40 percent |
| Cases (3) | 30 percent |
| (NOTE: Class participation and discussion are expected.) |
Course Outline and Schedule:
Dates(week) Topic and Chapters of Texts
1/19 The Function of Financial Markets (F&M-1; Van
Horne-1)
1/26 Savings, Investment, and Financial Markets
(F&M-2,16; Van Horne-2,3)
Loanable Funds Model of Interest Rate Determination
2/2 Commercial Banking and Other Financial
Intermediaries and Their Role in the Economy (F&M-3,4,5; Van
Horne-3,6,7,8,9)
FDIC
Presentation of Bank and S&L Performance
2/9 Primary and Secondary Markets (F&M-6,7)
2/16 Risk and Return and Asset Pricing Models (F&M-8,9; Van Horne-3)
Risk and Rates of Return -- CAPM
2/23 Interest Rate Determination, Bond Valuation and the Yield Curve (F&M-17,18; Van Horne-4,5,6; IMM-5,6,7)
3/2 Introduction to Financial Futures, Swaps and Options Markets (F&M-10,11,12; Van Horne-9,10,11)
Eurodollar Futures Contracts and Review of Futures
3/9 SPRING BREAK (March 9-15)
3/16 MIDTERM
3/23 Corporate Stock and Stock Options and Derivatives Markets (F&M-13,14,15; Van Horne-10)
3/30 Money Market Instruments and Treasury and Agencies Securities Markets(F&M-19,20; IMM-1,2,3,4,8,10,11,12,13)
4/6 Interest Rate Futures,
Options, and Customized Contracts (F&M-28,29; Van
Horne-9,10,11; IMM-14,15,16)
4/13 Corporate Senior Securities and the Municipal
Securities Markets (F&M-22,23; Van Horne-8,12)
4/20 Mortgage Markets and Instruments
(F&M-24,25,26,27; Van Horne-13)
4/27 Balance of Payments, International Transactions,
Foreign Markets (F&M-30,31; Van Horne-14;)
5/6 Final Examination (7:30 p.m. to 10:15 p.m.)
Cases:
General:
i) Each case must be turned in by the due date
ii) The case must be 4-5 pages typewritten, not including charts, graphs, tables or references..
iii) One letter grade penalty for each day late.
Case Preparation Instructions:
A. Purpose of the case: to allow the reader to determine what the author intends to do and the author's plan and strategy for completing the analysis.
B. Analysis types
1. Examination of an existing data base or combination of bases in an effort to establish some cause-and-effect relationship between the variables examined.
2. The application of a decision-theory technique or combination of techniques to a new or previously unresolved problem.
3. Development of a new data base and an analysis of the data gathered.
D. Suggested Outline of Case Presentation
1. Title page and Executive Summary
2. Problem Statement and nature of the problem to be addressed.
a. Background, may include a theoretical framework
b. Central question to be addressed by the research
3. Approach and methodology to address the problem as stated above
a. Methods and approach
b. Data Sources
c. Areas that will be excluded or beyond the scope of the case analysis
4. Analysis procedure and data sources
a. Models, if any, to be used and how will they be developed
b. Sources of information, how will data be obtained and the organization of the data
5. Summary and conclusion. This may also be presented in an Executive Summary.