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Viewing: BUS 428 : Financial Analytics

Last approved: Fri, 19 Feb 2016 21:26:20 GMT

Last edit: Fri, 19 Feb 2016 21:26:20 GMT

Change Type
BUS (Business Management)
428
032242
Dual-Level Course
No
Cross-listed Course
No
Financial Analytics
Financial Analytics
Poole College of Management
Business Management (20BUS)
Term Offering
Spring Only
Offered Every Year
Spring 2016
Previously taught as Special Topics?
No
 
Course Delivery
Face-to-Face (On Campus)

Grading Method
Graded with S/U option
3
16
Contact Hours
(Per Week)
Component TypeContact Hours
Lecture3
Course Attribute(s)


If your course includes any of the following competencies, check all that apply.
University Competencies

Course Is Repeatable for Credit
No
 
 
Srinivasan Krishnamurthy
Associate Professor

Open when course_delivery = campus OR course_delivery = blended OR course_delivery = flip
Enrollment ComponentPer SemesterPer SectionMultiple Sections?Comments
Lecture4040Non/a
Open when course_delivery = distance OR course_delivery = online OR course_delivery = remote
Prerequisite: BUS 320
Is the course required or an elective for a Curriculum?
Yes
SIS Program CodeProgram TitleRequired or Elective?
20BUSB.S. in Business Administration- Concentration in FinanceElective
20ACCB.S. in Accounting- Concentration in Financial AnalysisElective
Advanced course examining the use of big data analytics in finance. The focus will be on the application of these tools in the areas of asset management and equity valuation. Topics covered include risk-return tradeoff, financial intermediaries in asset management (e.g., mutual funds, hedge funds, etc.), stock valuation models, and using financial statement information in stock selection / asset management. Students will complete a semester-long project involving data analysis (e.g., write an equity research report on a publicly traded U.S. firm, backtest an investment strategy, etc.).

This advanced elective course is designed to introduce students to financial analytics. Financial analytics is concerned with (a) analyzing financial data from the stock markets (“big data”) and from financial statements (income statements and balance sheets) and (b) using the insights from this analysis to make financial decisions.  The skills acquired in this course are applicable in jobs in business and financial analytics, consulting, corporate finance/valuation, mutual funds/hedge funds/pension funds, investment banking, forensic accounting, securities litigation consulting, etc. The course will build upon finance concepts covered in the introductory finance class.


No

Is this a GEP Course?
No
GEP Categories

Humanities Open when gep_category = HUM
Each course in the Humanities category of the General Education Program will provide instruction and guidance that help students to:
 
 

 
 

 
 

 
 

 
 

 
 

Mathematical Sciences Open when gep_category = MATH
Each course in the Mathematial Sciences category of the General Education Program will provide instruction and guidance that help students to:
 
 

 
 

 
 

 
 

Natural Sciences Open when gep_category = NATSCI
Each course in the Natural Sciences category of the General Education Program will provide instruction and guidance that help students to:
 
 

 
 

 
 

 
 

Social Sciences Open when gep_category = SOCSCI
Each course in the Social Sciences category of the General Education Program will provide instruction and guidance that help students to:
 
 

 
 

 
 

 
 

 
 

 
 

Interdisciplinary Perspectives Open when gep_category = INTERDISC
Each course in the Interdisciplinary Perspectives category of the General Education Program will provide instruction and guidance that help students to:
 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

Visual & Performing Arts Open when gep_category = VPA
Each course in the Visual and Performing Arts category of the General Education Program will provide instruction and guidance that help students to:
 
 

 
 

 
 

 
 

 
 

 
 

Health and Exercise Studies Open when gep_category = HES
Each course in the Health and Exercise Studies category of the General Education Program will provide instruction and guidance that help students to:
 
 

 
 

 
 

 
 

 
&
 

 
 

 
 

 
 

Global Knowledge Open when gep_category = GLOBAL
Each course in the Global Knowledge category of the General Education Program will provide instruction and guidance that help students to achieve objective #1 plus at least one of objectives 2, 3, and 4:
 
 

 
 

 
Please complete at least 1 of the following student objectives.
 

 
 

 
 

 
 

 
 

 
 

US Diversity Open when gep_category = USDIV
Each course in the US Diversity category of the General Education Program will provide instruction and guidance that help students to achieve at least 2 of the following objectives:
Please complete at least 2 of the following student objectives.
 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

Requisites and Scheduling
 
a. If seats are restricted, describe the restrictions being applied.
 

 
b. Is this restriction listed in the course catalog description for the course?
 

 
List all course pre-requisites, co-requisites, and restrictive statements (ex: Jr standing; Chemistry majors only). If none, state none.
 

 
List any discipline specific background or skills that a student is expected to have prior to taking this course. If none, state none. (ex: ability to analyze historical text; prepare a lesson plan)
 

Additional Information
Complete the following 3 questions or attach a syllabus that includes this information. If a 400-level or dual level course, a syllabus is required.
 
Title and author of any required text or publications.
 

 
Major topics to be covered and required readings including laboratory and studio topics.
 

 
List any required field trips, out of class activities, and/or guest speakers.
 

Current resources allow offering this course.

Student Learning Outcomes

· Explain the role of financial intermediaries (e.g., mutual funds, hedge funds)


· Develop valuation models to estimate/forecast a firm’s performance


· Describe how portfolio managers (market funds/hedge funds/pension funds), auditors, consultants, and others can use information from stock market data and financial statement data in decision making


Evaluation MethodWeighting/Points for EachDetails
Project20%Valuation spreadsheet- 5%
Preliminary report- 5%
Final report- 5%
Homework20%4 homework assignments required
Midterm20%n/a
Final Exam40%n/a
TopicTime Devoted to Each TopicActivity
Schedule Module 1Class Meeting 1 Introduction to the courseStock valuation, Risk-return tradeoff, and Estimating FCFs from BUS320Meetings 2, 3, 4 Diversification, systematic and unsystematic riskConcept of expected and ‘abnormal return’, Cost of capital, alpha (Chapter 2)Market structure and market efficiencyMeeting 5 Introduction to WRDS Project deliverables: Select your industry sectorMeetings 6, 7 Introduction to investment management, trade execution qualityMutual funds and their prospectuses, hedge funds, regulatory frameworkMeetings 8, 9 Using financial statements, creating proformasIdentify the choice set of firms Module 2Meetings 10, 11, 12, 13 Valuation mechanics - DDM and DCF valuation (Chapters 3, 4), JCP exerciseMeetings 14, 15 Sales forecastingMeetings 16, 17Meeting 18 Residual income valuation (Chapter 5), Valuation using multiples (Chapter 6)Mid Term Exam Module 3Meetings 19, 20 Concept of earnings quality and accruals. Sloan TAR 1996, Ali JAR 2008.Valuation spreadsheet (initial draft) dueMeetings 21, 22 Using financial data to identify winners: Piotroski (JAR 2000), Choi (RFS 2012)Use of warranty disclosure data - CDHZ (TAR 2011)Meeting 23 Short sellers: Dechow (JFE 2001), Desai (RAST 2005), Engleberg (JFE 2012)Valuation research report (initial draft) dueMeetings 24, 25 Momentum strategies - Jegadeesh and Titman (JF 2001)Meetings 26, 27 Arbitrage strategies - Gatev et al. (RFS 2006), LSV (JF 1994)Submit final reportMeetings 28, 29 Student presentationsJournal names:JAR - Journal of Accounting Research JF – Journal of Finance JFE – Journal of Financial Economics RAST – Review of Accounting StudiesRFS – Review of Financial Studies TAR – The Accounting ReviewDue Dates 1. Class Meeting 4 Select your industry sector.2. Meeting 9 HW1 (5% of semester grade)3. Meeting 9 Identify choice set of firms4. Meeting 16 HW2 (5% of semester grade)5. Meeting 18 Mid Term Exam (20% of semester grade)6. Meeting 21 Valuation spreadsheet (initial draft) (5% of semester grade)7. Meeting 23 HW3 (5% of semester grade)8. Meeting 23 Preliminary research report due (5% of semester grade)9. Meeting 25 HW4 (5% of semester grade)10. Meeting 27 Final report due (10% of semester grade)11. Meetings 28, 29 Student presentations 12. Final exam during finals week ((40% of semester grade)

Key: 7588