University at Albany School of Business

BFIN 525 Financial Management Fall 2012 Classes 3203 and 3204 M 5:45 8:35 PM (3203) in BA 229 and W 5:45 8:35 PM (3204) in BA 229

Professor Ross Miller E-mail (best contact method): rmmiller@albany.edu Office: BA 348 Office hours: MW 4:30 5:30 PM (and by appt.) Voice Mail/Phone: 442-4967

Finance 525 Mission Statement To give every student a practical understanding of how the world of finance works. Course Calendar (subject to revision as necessary) Week 1 2 3 4 5 6 7 8 9 10 11 12 13 Monday August 27 September 10 September 24 October 1 October 8 October 15 October 22 October 29 November 5 November 12 November 19 November 26 December 3 Wednesday August 29 September 5 September 12 September 19 October 3 October 10 October 17 October 24 October 31 November 7 November 14 November 28 December 5 Topic Introduction and Making Money in Financial Markets Inside the Stock Market Stock Portfolios and CAPM (Trying to) Beat the Market Factors Affecting Stock Returns Stock Options Forward and Futures Contracts U.S. Treasury Securities Riskier Fixed Income Securities Asset Allocation Portfolio Optimization Capital Budgeting and Make-up Quiz (unless delayed) Make-up Class and/or Quiz (if needed)

Quizzes Given at the beginning of class during Weeks 3, 6, 9, and 11 (on the days noted in bold above). Quizzes days may be given later if classes are cancelled for snow or other reasons. The make-up quiz for those who missed any of the four quizzes will be the last class meeting.

Finance 525

Fall 2012

Professor Ross Miller - 2

Prerequisites The course catalog lists Acc 512 or Acc 518 and Itm 513 as prerequisites for Fin 525. Fin 515 is also required, but can be taken simultaneously with Fin 525. In practice, students in mathematics, science, or engineering Ph.D. programs are automatically admitted to the course (space permitting). Other graduate students are only admitted to the course if they have previously taken suitable advanced mathematics, statistics, econometrics, and/or microeconomics courses at the University at Albany. In particular, this means that students who have just enrolled in a graduate program at the University normally cannot take Fin 525. Regardless of whether a student has taken or placed out of a prerequisite he/she is responsible for the full content of the course as described in the course catalog. Course Materials This is no textbook for this course, although several readings early in the course come from a free online textbook, Corporate Finance: An Introduction by Ivo Welch http://book.ivowelch.info/). Materials for the course come from a variety of sources and are compiled into a single PDF file that is available on Blackboard each week (including helpful comments from the professor). To keep the course in sync with current financial events, readings are generally assigned the week before the class meeting in which they are covered. Grading All students must take four quizzes during the course of the semester. A student who misses a quiz must take the make-up quiz at the end of the semester. A student who misses more than one quiz must have valid excuses for both absences and make special arrangements with the professor. The quiz on which a student has the worst score is given only 1/3 the weight of the other quizzes. Class attendance and participation as will be considered in converting the raw grade determined by the quizzes into the actual course grade. All quizzes are open book and calculators, subject to the restrictions given below, are permitted. Devices with either substantial storage and/or computational capacity or the ability to communicate, such as computers, cell/smart phones, tablets and iPods, are not permitted in quizzes. Online and Computational Material The main source for course material, including assignments and project/course grades, is the Blackboard Learning System. Students should have access to a computer that is able to view files in PDF, DOC, PPT, and XLS formats. Office 2010 is the schools supported office productivity software; however, any

Finance 525

Fall 2012

Professor Ross Miller - 3

version of Office currently in common use should be able to view and manipulate all course material. Most web pages referred to in this class will be viewable directly by any major web browser. On rare occasions, web pages referred to in class may not work with all browsers or may require that Java or Flash be installed. There is an assignment towards the end of the course where Excel 2010 or later will be easier to use than earlier versions. Financial calculators are not supported in this course; however, students familiar with them are free to use them for assignments and in quizzes. A simple $10-$20 scientific calculator such as those made by Casio (FX-300), TI (30-x), HP, and Sharp should be more than adequate for this course, but more advanced scientific or graphing calculators are also acceptable (and can be used in quizzes). Other Administrative Details Students in Fin 525 may attend either section of the class, including quizzes, as long as they notify the professor in advance via e-mail (except when impractical). Class sessions are synchronized so that essentially the same material is covered in each section during a given day. If either section becomes overcrowded, further restrictions on attendance may be imposed. Fin 525 will adhere to the academic policies of the University at Albany School of Business including those concerning cheating, plagiarism, and the granting of incomplete grades. Students occasionally request that special administrative action(s) be taken. Such requests should be made in a timely manner both via e-mail and through direct contact with the professor.

Finance 525

Fall 2012

Professor Ross Miller - 4

Course Objectives and Learning Outcomes This course is designed to provide a basic working knowledge of three major topic areas: o The time value of money o Risk/return tradeoffs for assets and portfolios of assets o Capital budgeting (valuation of real capital projects) These three topic areas are approached in a way that will provide maximum value to all students, including those with no interest other than their own personal finances The course will acquaint students with the following securities, the markets in which they trade, and how they are valued: o Common stock o Exchanged-traded funds (ETFs) o (Open-end) mutual funds (active and passive) o Stock options o Currency (including spot and forward markets for foreign currency) o Commodity futures o Forward contracts o Treasury bills o Treasury STRIPS o Treasury notes and bonds o Corporate bonds o Sovereign bonds o Credit default swaps o Portfolios that contain multiple types of assets Programmatic Learning Goal This course will test a Programmatic Learning Goal for the MBA Full-Time program as required by AACSB: Students will be able to show comprehension of concepts from Finance.