> UWT Ybjbj *Z^.$>~9uuuRuuuu.u.0^u!Tuu0uu^ : EASTERN MEDITERRANEAN UNIVERSITYFACULTY OF BUSINESS AND ECONOMICSDEPARTMENT OF BANKING AND FINANCE
Spring 2019-2020
COURSECODE AND TITLE:
INSTRUCTOR:
E-MAIL and OFFICE :
ASSISTANT:
E-MAIL and OFFICE:
COURSE LEVEL:COURSE TYPE:
FINA 462 Financial Modeling
Asst. Prof. Dr. Nigar TA^PINAR
nigar.taspinar@emu.edu.tr - BE141
Sonia Malvina Djeuda
sdjeuda@gmail.com -BE135
Fourth Year
Area Core
DURATION OF COURSE:
CREDIT VALUE:
ECTS CREDIT: One semester
3
6OFFICE HOURS:To be announced.TEXTBOOKS:Financial Modeling Using Excel and VBA 2004. Chandan Sengupta. John Wiley and Sons, Inc.
Introductory Econometrics for Finance 2008, 2nd Edition, Chris Brooks. Cambridge University Press.
CATALOG DESCRIPTION
This course covers financial modeling techniques based on financial theory and strategies. It also covers a comprehensive application of cross-section and time series financial and economic data by using Microsoft EXCEL and EVIEWS software.
AIMS AND OBJECTIVES
The aim of this course is to familiarize students with financial modeling techniques by using financial and economic data. To enhance the analytical skills of students to interpret data and to produce information for decision making in
functional areas of banking and finance. To help students think analytically and to motivate students to design and develop financial models for solving financial problems.
GENERAL LEARNING OUTCOMES
On successful completion of this course, all students will have developed knowledge and understanding of:
Importance of financial modeling
Designing and building financial models based on finance theories and strategies
On successful completion of this course, all students will have developed their skills in:
Analyzing financial and economic data
Spreadsheet modeling with Microsoft EXCEL
Run statistical techniques in EVIEWS software
On successful completion of this course, all students will have developed their appreciation of and respect for values and attitudes regarding the issues of:
Applications by adopting financial theories
Understanding the features of cross section and time series financial and economic data
Using financial models in financial decision making
RELATIONSHIP WITH OTHER COURSES
Applications involve topics in banking and finance and economics.
LEARNING/TEACHING METHOD
Lectures, application exercises by topic in classroom and tutorials, applications using EXCEL and EVIEWS software in tutorials in the lab where applicable and assignments.
ASSIGNMENTS
Assignments will be given to enhance the students understanding of the topics covered and to hone their analytical skills. Problems assigned on each topic from the end of each chapter and particular sources.
INDICATIVE BASIC READING LIST
None
EXTENDED READING LIST
None
SEMESTER OFFERED
Fall and Spring Semesters
CONTENT AND SCHEDULE
WEEKCHAPTEROBJECTIVES
1Lecture 1 - Introduction to Financial Modeling
What is a financial model?
Steps in creating a model
2Lecture 2 Introduction to Financial Modeling
Application: Applying formulas in EXCELHow to build good excel models
Types of data
Econometric Packages for modeling financial data3Lecture 3 Financial Statement Modeling
Application: Calculations for
Income Statements and Balance Sheets in EXCELReview of Concepts
Steps in financial statement modeling
4Lecture 4 Time Value of Money
Application: Time value of money functions in EXCELReview of Concepts
Definitions of PV, FV, Rate, NPER
5 Lecture 5 Time Value of Money
Application: Time value of money functions and loan amortization table in EXCELAnnuities
Loan Amortization6Lecture 6- Investment and Project Evaluation
Application: Applications of NPV, IRR in EXCELReview of Concepts
Net Present Value
Internal Rate of Return7Review for Midterm Exam
Application: Review of EXCEL Applications
April 6-17
MID-TERM EXAMINATION
10
Lecture 7- A brief overview of classical linear regression model
Application: Introduction to EviewsWhat is a regression model
Regression vs. Correlation
11Lecture 8 A brief overview of classical linear regression model
Application: Estimation of an optimal hedge ratio
Simple Regression
Properties of OLS estimator
12Lecture 9- A brief overview of classical linear regression model
Application: Can US mutual funds beat the market?
The t-ratio
An example of the use of a simple t-test to test a theory in finance
The overreaction hypothesis and the UK stock market
13Lecture 10- Estimation and hypothesis testing
Application: Estimation and Hypothesis testing in Eviews-CAPM example
Review of Concepts
Hypothesis testing
14Review for Final Exam
Application: Review of Applications in Eviews
FINAL EXAMINATION
May 27 June 13
METHOD OF ASSESSMENT
Midterm Examination 30 %Final Examination 40 %Quizzes and Assignments
Class and Lab Participation
20 %
10 %
COURSE POLICIES
1. Student attendance is monitored and assessed by the course instructor. As per Faculty Council Decision 2018-2019/11, students who fail to attend the minimum required number of classes will be considered unsuccessful in the course and receive an NG (No Grade) grade. If you have any special circumstances or problems that affect your class attendance, inform your instructor. Your special circumstances or problems will be assessed by the course instructor.2.Make-up Policy
You are expected to take the exams on the days at which they are given. Therefore you should make every effort to take good care of yourselves in order not to get sick during the exam periods. Any student absent from an exam and able to provide a reasonable excuse within three days following the exam will be able to write the make-up exam.3. Behavior befitting a mature university student is expected of you at all times. 4. Mobile phones should definitely be turned off during the class meetings, examinations, and quizzes.
ACADEMIC HONESTY
Academic honesty is the cornerstone of the development and acquisition of knowledge. Academic honesty demands that the contribution of others be acknowledged. To do less is to cheat. To pass off contributions and ideas of another as ones own is to deprive oneself of the opportunity and challenge to learn and to participate in the scholarly process of acquisition and development of knowledge. Not only will the cheater or intellectually dishonest individual be ultimately his/her own victim, but also the general quality of scholarly activity will be seriously undermined. It is for these reasons that Eastern Mediterranean University insists on intellectual honesty in scholarship. The control of intellectual dishonesty begins with the individuals recognition of standards of honesty expected generally and compliance with those expectations. Plagiarism, cheating and other misconduct are not acceptable. Individual work must reflect an individuals own effort. Plagiarism is an offense and will be dealt with according to University regulations. A single offence of cheating, plav
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