bsc in financial engineering (2018 onwards)

BSc in Financial Engineering (2018 onwards)

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BACHELOR OF SCIENCE IN FINANCIAL ENGINEERING

CURRICULUM REVISION - DEGREE PROGRAM IN FINANCIAL ENGINEERING

Introduction

BSc in Financial Engineering (external) degree programme focuses on creating new financial

strategies and tools used to forecast financial trends, develop financial instruments / models

and establish new methods that are beneficial to businesses and organizations to make

strategic financial decisions. Students pursuing this degree will learn essential Mathematics,

Statistics, language and computer skills, Basic Economics and Accounting, Quantitative

techniques, quantitative finance, financial modeling, risk management, corporate finance,

Professional development and practices in finance.

Rationale

The drive toward financial market expansion and development suggests the need for people

who are able to identify, evaluate, forecast, disseminate and provide integrated solutions to

meet the needs of financial sector. “Financial Engineering” continues to be one of the fastest

growing areas within modern financing/banking. Together with the sophistication and

complexity of modern financial products, this exciting discipline continues to act as the

motivating factor for new mathematical models and the subsequent development of

associated computational schemes. Although relatively young, financial mathematics has

developed rapidly into a substantial body of knowledge and established part of mathematical

science. The proposed revision is designed to fulfill the demand for expertise in the drive

toward financial expansion and development.

The course is structured to support all part-time external students to engage with the

Lecturers in the course modules continuously. Learning Management system (LMS) is used

as a self-learning assessment and evaluation mechanism.

The intellectually exciting and practical Finance course will prepare students for a range of

careers in the financial analysis field within Sri Lanka and internationally. With a degree in

Financial Engineering students can harness skills necessary for economic analysis, financial

forecasting, and financial practice as well as for financial consultancy, advisory and financial

product development/analysis.

Indented Learning Outcomes of BSc in Financial Engineering

The end of the 3 years (SLQF Level 5) BSc in Financial Engineering Degree holders should

be able to:

1. demonstrate knowledge and proficiency in the terminologies, theories, concepts,

practices and skills specific to the field of finance and insurance financial product

development.

2. observe and interpret financial markets to uncover potential opportunities and

construct financial portfolios.

3. apply best practices in financial management to make plans, organize projects,

monitor outcomes and provide financial leadership.

4. apply the Standards of Practice and Codes of Conduct of Financial Practitioners to

address ethical challenges within the business environment and demonstrate

intellectual maturity in a global setting.

5. practice professionalism and uphold ethical standards and improve/update skills

required for employment and life-long learning.

6. effectively communicate & disseminate knowledge, information and ideas to


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specialist and a wider society

7. perform independently as well as interdependently

Specific Intended Learning Outcomes

Upon completion of the BSc Financial Engineering, the following criteria shall be fulfilled:

1. KNOWLEDGE

Upon completion of the BSc in Financial Engineering programme, the student should

possess knowledge and understanding of the following:

● Insight into some of the subjects fundamental to finance.

● Basic principles, theories and applications in the field of financial mathematics.

● Mathematical analysis common to most financial analysis disciplines, calculus,

linear algebra.

● Differential equations models for finance.

● Numerical methods and scientific computing to solve problems in calculus,

differential equations, and linear algebra.

● Basic probability theory and statistics including data analysis, error analysis,

hypothesis testing and linear regression.

● Basic understanding of financial programming in common languages and

spreadsheet applications.

● Basic principles of Economics and Accounting

2. SKILLS

Upon completion of the BSc in Financial Engineering programme, the student should have

gained the skills to:

2.1 Disciplinary skills

● Quantify and model the financial structure of projects and corporations and for

that purpose apply suitable techniques.

● Design mathematical models of the financial functions of organizations and solve

the formulated problems by a range of quantitative techniques, including

simulation and optimization techniques.

● Plan, manage and analyze financial and operational structures in projects, using

recognized financial techniques as well as other current best-practice methods.

● Apply the statistical methods in order to analyze and interpret data.

● Carry out risk assessment by disciplines of risk management and decision

analysis.

2.2 Personal Skills

● Apply financial methods to projects, i.e. have the ability to assess the financial

feasibility of the projects and identify the key factors in a given situation, and

develop an approach to a solution.

● Formulate and work on open-ended problems, including creative thinking.

● Apply research methodology, including the fundamentals of technical writing and

information finding, including literature search.

● Apply standard scientific principles to develop financial solutions to a range of

practical problems.

2.3 Interpersonal skills

● Develop strategic communication skills through industry based management case

studies.

● Communicate effectively and professionally and formulate sound arguments,


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both in writing and by means of presentations, using appropriate professional

techniques.

● Developing team analytical negotiation skills in providing a business proposal

and project plan.

● Be an effective team member and contribute to the management of team projects

by interpreting data analysis.

3. COMPETENCE (Attitudes, Values, Professionalism and Vision for life,

Lifelong Learning)

Upon completion of the BSc programme, the student should be able to utilize the knowledge

and skills he/she has acquired to:

● Apply analytical skills and modelling methodologies to recognize, analyze, synthesize

and implement operational solutions to Finance problems

● Apply standard quantitative scientific principles to develop finance solutions to a

range of practical problems in Finance

● Appreciate the importance of keeping up with evolving industry practice technologies

and technology and research, to meet expand professional competencies and industry

expectations.

● Undertake further studies towards a graduate level degrees and professional

qualifications.

Program Structure

B.Sc. in Financial Engineering will be completed in three years (90 Credits / SLQF Level 5)

and it consists of three levels.

LEVEL I: Diploma in Financial Engineering (30 Credits)

LEVEL II: Advanced Diploma in Financial Engineering (60 Credits)

LEVEL III: BSc in Financial Engineering (90 Credits)

LEVEL I

Semester Course

Code

Course Title Credit

/Hours

Core

/Elective

Semester I FE 1101 Economics I for Finance 30L 2C Core *

Semester I FE 1102 Mathematics for Finance 30L 2C Core *

Semester II FE 1103 Accounting I for Finance 30L 2C Core *

Semester I FE 1104 Statistics I for Finance 30L 2C Core

Semester I FE 1105 Applied Finance 30L 2C Core *

Semester I FE 1106 Computing for Finance 60P 2C Core *

Semester II FE 1107 Financial English 30L 2C Core *

Semester I FE 1108 Management Science I 30L 2C Core

Semester II FE1109 Economics II Finance 30L 2C Core *

Semester II FE 1110 Statistics II for Finance 30L 2C Core

Semester II FE 1111 Calculus for Finance 30L 2C Core *

Semester II FE 1112 Linear Algebra 30L 2C Core

Semester I FE 1113 Differential Equations I for

Finance

30L 2C Core

Semester I FE 1114 Financial Markets & Instruments 30L 2C Core *

Semester II FE 1115 Numerical Methods I for Finance 60P 2C Core *

*Compulsory course to eligible for Diploma in Financial Engineering


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LEVEL II

Semester I FE 2101 Accounting II for Finance 30L 2C Core *

Semester I FE 2102 Advanced Applications in

Spreadsheet

60P 2C Core

Semester II FE 2103 Financial risk Management I 30L 2C Core *

Semester I FE 2104 Investment Analysis I 30L 2C Core *

Semester I FE 2105 Management Science II 30L 2C Core

Semester I FE 2106 Financial Econometrics 30L 2C Core *

Semester I FE 2107 Insurance for Business 30L 2C Core *

Semester II FE 2108 Investment Analysis II 30L 2C Core *

Semester II FE 2109 Survival Models and Analysis 30L 2C Core *

Semester II FE 2110 Differential Equations II for

Finance

30L 2C Core

Semester II FE 2111 Life Insurance Models 30L 2C Core *

Semester II FE 2112 Fuzzy Modeling 60P 2C Core

Semester I FE 2113 Financial Statement Analysis 30L 2C Core *

Semester II FE 2114 Numerical Methods II for Finance 60P 2C Core *

Semester I FE 2115 Game Theory 30L 2C Core

*Compulsory course to eligible for Advance Diploma in Financial Engineering (together

with Level I *)

LEVEL III

Semester II FE 3101 Investment Analysis III 30L 2C Core

Semester II FE 3102 Financial Risk Management II 60P 2C Core

Semester I FE 3103 Computational Modeling 30L 2C Core

Semester I FE 3104 Management Science III 30L 2C Core

Semester I FE 3105 Stochastic Calculus for Finance 30L 2C Core

Semester I FE 3106 Banking and International Finance 30L 2C Core

Semester II FE 3107 Portfolio Management 30L 2C Core

Semester I FE 3108 E-Commerce 30L 2C Core

Semester II FE 3109

Professional Development in

Finance

60P 2C Core

Semester I FE 3110 Case Studies in Management 60P 2C Core

Semester II FE 3111 Professional Financial Practice 60P 2C Core

Semester I FE 3112 Project 180P 6C Core

Semester II FE 3113 Data Analysis 60P 2C Core


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Course Code &

Title

FE1101 Economics I for Finance

Credit Value &

Lecture Hours

30 L 2C

Prerequisite None

Objective To provide essential Economic knowledge to be applied with quantitative

Finance.

Learning

Outcomes

At the end of the course students will be able to;

● Interpret the essential principles of microeconomics.

● Apply economic theory to solve and interpret financial problems.

Course Content Introduction to Microeconomics, Demand and supply, Elasticities of Demand,

,The application of Market Laws and Elasticities ,Theory of Consumer Behavior

Theory of Production and Analysis of Cost, Labour markets, Theory of

Production and the Production of Two Variable Inputs, The Theory of Cost of

Production, The firm and its objectives , The market Structure, Price and output

determination, Market Failure and Public goods.

Methods of

Evaluation

● Final exam – 60%

● Take home assignment- 15%

● Midterm Test- 15%

● In class Assessment-10%

Recommended

Reading

● Lipsey, R. G. & Chrystal, K. A (2015). Principles of Economics (13th

ed.).

Oxford University Press.

● Dwivedi, D. N. (2009). Microeconomics: Theory & Applications. The

McGraw- Hill Companies.

Course Code &

Title

FE 1102 Mathematics for Finance

Credit Value &

Lecture Hours

30L 2C

Prerequisite None

Objective To provide basic mathematical concepts required in Finance.

Learning

Outcomes

The end of the course students are able to;

• Express and derive mathematical statements.

• Identify functions and their properties.

• Solve basic linear difference equations, describe their behavior and apply

them related to finance.

Course Content Introduction to Set Theory and Mathematical Reasoning: Propositional Logic,

Logical Operations, Truth Tables, Proofs and types of proofs, Quantifiers,

negation of statements with quantifiers and Types of Proofs, Relations, types of

functions such as one-to-one, onto, inverse, Inequalities, Linear Difference

Equations and their applications in Finance.

Methods of

Evaluation

● End Semester Exam – 60%

● Continuous Assessments – 40%


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Recommended Reading

● Eccles, P. J. (1997). An Introduction to Mathematical Reasoning:

Numbers, Sets and Functions. Cambridge University Press.

● Goldberg, S. (1958). Introduction to Difference Equations. Dover

Publications, Inc., New York.

Course Code &

Title

FE 1103 Accounting I for Finance

Credit Value &

Lecture Hours

30L 2C

Prerequisite None

Objective Provide the Fundamental concepts of Financial and Management Accounting

principles of a Business.

Learning

Outcomes

At the end of the course, students are able to;

● Identify the basic principles of Financial Accounting.

● Identify the basic principles of Management Accounting.

Course Content Introduction to Accounting and its environment, Financial Statements, Ledger

accounting, Profit and Loss Account, Balance Sheet, Trial balance, Trading and

Manufacturing Account, Bank reconciliation, Intangibles, Suspense accounts,

Control of cash and bank transactions, Inventories, Income and Expenditure

Account and Accounts for small business unit, Incomplete records, Cost

Accounting Cost classification, Materials and Stocks control, Labor cost

allocation and Overheads classification and analysis, Absorption and Marginal

costing, Financial Accounting packages.

Methods of

Evaluation



Recommended

Reading

● Wijewardena, H. (2004). Financial Accounting in Sri Lanka.

● Wood, F. (1967). Business Accounting.

Course Code &

Title FE 1104 Statistics I for Finance

Credit Value &

Lecture Hours

30L 2C

Prerequisite FE 1006

Objective To provide basic statistics concepts within a financial context.

Learning

Outcomes


● Identify and apply commonly used techniques for data collection and

analysis.

● Analyze statistical data using graphical methods, measures of central

tendency, dispersion and location.

● Identify some applications of statistical analysis in business practice.

● Use Excel to perform statistical analysis.

● Apply fundamental concepts of probability to solve problems in business

decision-making and interpret the outcomes.


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Course Content Introd Types of Variables, Descriptive Statistics, Data and Representation, Measures of

Central Tendency, Measures of Spread, Measures of Shape, sample space and

events, defining probability, basic elements of Probability, Mutually exclusive

events, Addition and Multiplication rules, conditional probability, Independence

of events, Combinatorial Probability, Bayes Theorem/Law of Probability, Excel

functions for basic statistics.

Methods of

Evaluation



● Practical Exam (Excel) – 10%

Recommended

Reading

● Leekly, R. M. (2010), Applied Statistics for Business and Economics.

CRC Press.

● Wegner, T. (2013). Applied Business Statistics: Methods and Excel-

Based Applications (3rd ed.). Juta and Company Ltd.

Course Code &

Title

FE 1105 Applied Finance

Credit Value &

Lecture Hours

30L 2C

Prerequisite None

Objective To provide basic concepts of money valuation process.

Learning

Outcomes


● Interpret and compute interest rates as required rate of return, rate of

discount, opportunity cost, effective annual rate of return, given the stated

annual rate of return, frequency of compounding.

● Compute and interpret the future value and present value of a single sum

of money, a series of regular payments (basic annuity), and varying

regular payments.

● Compute and apply the feasibility of small scale projects based on future

and present value concepts.

Course Content Interest rate, Simple and Compound interest rate, Time value of Money, Present

value, Future value, Discounting, Compounding, Effective rate of return (EAR),

Basic annuity valuation, Annuity immediate, Annuity due, Perpetuity,

Discounted cash flow analysis, NPV, Excel financial functions and their

applications.

Methods of

Evaluation


● Mid Semester Exam – 20

● Continuous Assessments –20%

Recommended

Reading

● Kellison, S. G. (2009). The Theory of Interest (3rd ed.). McGraw-Hill

Irwin.

● Beaumont, P. H. (2004). Financial Engineering Principles: A Unified

Theory for Financial Product Analysis and Valuation. John Wiley &

Sons, Inc.

● Capinski, M. & Zastawniak, T. (2003). Mathematics for Finance: An

Introduction to Financial Engineering. Springer.

Course Code & FE 1106 Computing for Finance


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Title

Credit Value &

Lecture Hours

60P 2C

Prerequisite None

Objective To provide basic knowledge in spreadsheet and mathematical programming

languages.

Learning

Outcomes


● Identify formulae in excel.

● Write simple excel programs to solve real world problems.

● Identify functions in MATLAB/Octave.

● Write simple programs using MATLAB/Octave to solve real world

problems.

Course Content Basics of worksheet, Worksheet formulas, Mathematical and statistical functions,

Dates, time and text functions, Financial functions, Lookup, reference and

information functions, Logical and conditional functions, Random functions and

data analyzing tools, Tables and pivot tables, Worksheet programming.

Getting started with MATLAB, Creating Arrays, Mathematical operations with

arrays, Curve plotting, MATLAB /Octave functions, programming in MATLAB

/Octave with common mathematics functions.

Methods of

Evaluation

Continuous Assessments – 100%

Recommended

Reading

● MacDonald, M. (2010). Excel 2010: Missing Manual (1st ed.). O’Reilly

Media, Inc.

● Walkenbach, J. (2010). Excel 2010 Bible (1st ed). John Wiley & Sons,

Inc.

● Gilat A. (2010), MATLAB: An Introduction with Application (4th ed.).

Wiley.

Course Code &

Title

FE 1107 Financial English

Credit Value &

Lecture Hours

30L 2C

Prerequisite None

Objective To introduce students to language elements required to navigate the world of

finance and economics effectively.

Learning

Outcomes


● Comprehend and use vocabulary related to various contexts of finance.

● Implement conversational strategies in professional contexts.

● Analyze language structures found in professional context to discern their

functions.

● Produce written communications following the established norms.

Course Content Budgeting: Vocabulary for Budgeting, Asking the Right questions: Probing

Questions, Forming Yes/No Questions, Forming WH Questions

Forecasting: Vocabulary for Forecasting, Answering Questions Without


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Defensiveness, Chart Communication/Storytelling, Transition Phrases for Cause

and Effect; and Contrast and Additions

Negotiating: Vocabulary for Negotiating , Maintaining Integrity and Making

Concessions, Persuasive Language-Logic, Phrases for Concession and Counter

Arguments

Auditing: Vocabulary for Auditing, Types of Power and Speaking Tone ,

Writing Tone and Levels of Formality, Writing Emails and Letters

Economics: Vocabulary for Economics, Building Relationships and Networking

, Reading Strategies and Comprehension, Modifiers and Parallelism

Methods of

Evaluation



Recommended

Reading

● Bovee, C., & Thill, J. (2014). Business communication essentials. Boston:

Pearson.

● Guffey, M. & Loewy, D. (2011). Business communication. Mason, Ohio:

Cengage Learning.

● Sweeney, S. (2014). English for Business communication. Cambridge:

Cambridge University Press.

Course Code &

Title

FE 1108 Management Science I

Credit Value &

Lecture Hours

30 L 2C


Objective To provide basic concepts of Operational Research modeling approach by

constructing and solving linear programming models related to management

science.

Learning

Outcomes


● Develop fundamental skills of linear programming models.

● Develop a linear programming model from problem description.

● Apply the Graphical and Simplex methods for solving linear

programming problems.

● Express the dual of a LP problem and interpret the results and obtain

solutions to the primal problem from the solutions of the dual problem.

● Solve LP problems using Excel Solver.

Course Content Overview of Operations Research, Concept of a model, Important topics of

Operations Research and Scope of it, A tool for Decision support system,

Introduction to Linear programming, formulation of problems and their features,

Applications in financial and economics fields, Graphical method, Simplex

method, Two Phase Method, Special cases of Linear Programming, Dual

problem, Economical interpretation of models, Excel solvers for LP problems.

Methods of

Evaluation

Continuous Assessments - 100%

Recommended

Reading

● Hillier, F. S., & Lieberman G. L. (2010). Introduction to Operations

Research (9th ed.). McGraw-Hill, New York.

● Taha, H. A. (2009). Operations Research (8th ed.). Pearson Prentice


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Hall.

Course Code &

Title

FE1109 Economics II Finance

Credit Value &

Lecture Hours

30 L 2C


Objective To explore essential Macroeconomics theories to complement finance. .

Learning

Outcomes

At the end of the course students are able to;

● Interpret the essential principles of macroeconomics.

● Apply economic theory to solve and interpret financial problems.

Course Content Working of an economy by identifying macroeconomic objectives and policies,

Aggregate Demand and Aggregate Supply, Use of fiscal and monetary policies,

Money supply and money demand and the conduct of monetary policy by the

Central bank, Trade theories and the understanding of the balance of payments

and the exchange rates, Determinants of inflation and unemployment, Theories of

economic growth and its determinants, understanding of the phases of the

business cycles.

Methods of

Evaluation

● Final exam : 60%

● Case Study: 10%

● Midterm exam: 15%

● Midterm exam: 15%

Recommended

Reading

● Lipsey, R. G., & Chrystal K. A. (2015). Principles of Economics,13th ed.,

Oxford University Press.

Course Code &

Title

FE 1110 Statistics II for Finance

Credit Value &

Lecture Hours

30L 2C


Objective To provide advanced statistics and probability concepts within a financial

context.

Learning

Outcomes


● Identify and apply commonly used probability distributions to model

financial problems.

● Use Excel to analysis and interpret the results.

Course Content Univariate probability Distributions: Probability functions and Probability

density functions, Cumulative distribution functions, Moments generating

functions, Binomial, Negative Binomial, Poisson, Uniform, Exponential,

Gamma, Normal distribution and Standard Normal distribution, Introduction to

the Chi-square distribution, Multivariate Probability Distributions: Joint

probability functions and probability density functions, Joint Cumulative

distribution functions, Central Limit Theorem, Conditional and Marginal


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Probability distributions, Covariance and Correlation coefficient,

Transformations and order statistics, Introduction to Estimation, Estimating the

Population mean, Sampling, Inference, Hypothesis Testing, P-value

Methods of

Evaluation



Recommended

Reading

● Robert M. L. (2010). Applied Statistics for Business and Economics.

CRC Press.

Course Code &

Title

FE 1111 Calculus for Finance

Credit Value &

Lecture Hours

30L 2C


Objective To provide essential concepts in calculus required in Finance.

Learning

Outcomes


● Identify the properties of functions derivatives, sequences and series.

● Compute and find limits, derivatives and integrals.

● Apply concepts in calculus to solve problems in finance.

Course Content The Concept of Limit, Continuity, Intermediate Value Theorem, Absolute Extrema

for Continuous Functions, Derivatives, Maxima and Minima of Differentiable

Functions of One and More Variables, Taylor Series and its various forms, Integral

Calculus: Riemann Integration, Mean value Theorem, Sequences and Series,

Concepts of Convergence and properties, Applications in Finance and Economics

fields.

Methods of

Evaluation



Recommended

Reading

● Stewart, J. (2011). Calculus: Early Transcendentals,7th ed., Brooks

Cole.

Course Code &

Title

FE 1112 Linear Algebra

Credit Value &

Lecture Hours

30L 2C

Prerequisite None

Objective To provide essential concepts in linear algebra to solve problems in finance.

Learning

Outcomes


● Perform operations in matrices.

● Interpret outcomes of the operations.

● Apply matrices to solve problems in finance.


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Course Content Matrices, Rank, Determinants, Non-singular matrices, Systems of Linear

Equations, Solutions to system of linear equations: Jacobi method, LU-

Decomposition, Vector Spaces subspaces, Null space, Basis and dimension,

Linear Transformations, Change of basis, Matrix representation of a linear

transformation, Inner Product Spaces, Eigenvalues and Eigenvectors, QR

factorization, Quadratic Forms, Linear Functional, Applications in Finance.

Methods of

Evaluation



Recommended

Reading

● Strang, G. (2012). Introduction to Linear Algebra, Wellesley-

Cambridge Press, U.S.

● Liesen, J., & Mehrmann, V. (2015). Linear Algebra,1st ed,Springer.

Course Code &

Title

FE 1113 Differential Equations I for Finance

Credit Value &

Lecture Hours

30L 2C


Objective To provide essential concepts in ordinary differential equations to solve

problems in finance.

Learning

Outcomes


● Solve first and second order ordinary differential equations and interpret

the outcomes.

● Model finance related problems using ordinary differential equations and

interpret the solutions in relation to finance and economics.

Course Content Introduction to Mathematical Modeling in Finance with ODEs, Ordinary

Derivatives of Functions: Physical interpretations and real life applications, First

order linear equations and their properties, Separable equations, Orthogonal

Trajectories, Exact Equations, Existence and Uniqueness Theorem without

proof, Applications of ODEs in Population dynamics, Radioactive decay,

models in finance and economics, Second order linear differential Equations,

Linear Equations with constant coefficients: Real roots, Complex roots,

Reduction of Order, Non-homogeneous equations and their applications.

Methods of

Evaluation



Recommended

Reading

● Hermann, M., & Saravi, M. (2014). A First Course in Ordinary

Differential Equations. Springer.

● Tenebaum, M., & Pollard, H. (1985). Ordinary Differential Equations:

An elementary text book for students of Mathematics, Engineering,

and the Sciences. Dover Publications, New York.

● Ahsan, Z. (2004). Differential Equations and their Applications, 2nd

ed., Prentice Hall.

Course Code & FE 1114 Financial Markets & Instruments

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Title

Credit Value &

Lecture Hours

30L 2C

Prerequisite None

Objective To provide the basic knowledge on various financial markets, their assets and

trading mechanisms.

Learning

Outcomes

At the completion of this course students are able to;

● Explain the functions of different financial markets.

● Describe the various assets and instruments traded in these markets and

the roles of different market participants.

● Perform simple calculations with respect to financial assets and interpret

results.

Course Content Types of Financial markets and their characteristics, Equity market, Forex

market, Insurance market, Bonds, Introduction to T- bills, Options, Derivatives,

Mutual Funds, Financial indices and their characteristic, Example of Financial

indices (Sri-Lankan and Global context), Dynamics of World Markets,

Commodity Markets.

Methods of

Evaluation

Continuous Assessment

● Classroom test 1 - 20%

● Classroom test 2 - 20%

● Classroom Group Work - 10%

● End Semester classroom test – 30%

● End Semester online test – 20%

Recommended

Reading

● Valdez, S., & Molyneux, P. (2013). An Introduction to Global Financial

Markets (7th ed.). Palgrave Macmillan.

● Barucci, E. (2003). Financial Markets Theory: Equilibrium, Efficiency

and Information, Springer.

Course Code &

Title

FE 1115 Numerical Methods I for Finance

Credit Value &

Lecture Hours

60P 2C


Objective To provide computer programming competencies to solve numerical problems.

Learning

Outcomes


● Identify the numerical algorithms for practical problems.

● Write and implement computer programs for numerical algorithms

● Apply numerical and programming tools to solve real world problems.

Course Content Introduction to Numerical methods, Needs of Numerical methods in Financial

Field, Taylor’s Theorem and its various forms, Orders of Convergence; Big O

and small O, Sources of Errors, Solutions for nonlinear equations; Bisection

Method, Newton Raphson Method and their convergence, Interpolation

Techniques, Numerical Integration, Numerical Methods for Linear Systems;

Direct Methods, Iterative Methods, Simple Iteration, Applications in Finance

and Economics fields, MATLAB/Octave codes for the described Numerical

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Methods.

Methods of

Evaluation


● Final Examination – 50%

Recommended

Reading

● Hamming, R. W. (1987). Numerical Methods for Scientists and

Engineers,2nd Revised ed., Dover Publications.

● Chapra, S. C. (2011). Applied Numerical Methods with MATLAB for

Engineers and Scientists,3rd ed.,McGraw-Hill Education.

Course Code &

Title

FE 2101 Accounting II for Finance

Credit Value &

Lecture Hours

30L 2C


Objective To provide the skills to analyze the Financial performance of Companies.

Learning

Outcomes


● Apply the basic principles of Accounting to interpret the performance of

companies

● Analyze Financial Statements of organizations for strategic decision

making

Course Content Introduction to the Principles of Accounting and Ratio Analysis , Preparing

financial statements and interpreting the relationship between the financial

statements, Analysis and communication of accounting information to

stakeholders

Methods of

Evaluation



Recommended

Reading

● Wijewardena, H. (2004). Financial Accounting in Sri Lanka.

Course Code &

Title

FE 2102 Advanced Applications in Spreadsheet

Credit Value &

Lecture Hours

60P 2C


Objective To provide hands on experience to utilize the power of worksheet application.

Learning

Outcomes


● Identify and implement spreadsheet formulae and solvers for real

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problems.

● Apply and implement spreadsheet programs to solve real problems.

● Write a macro programs for real problems.

Course Content Macro programing, Random functions, Worksheet programming.

Methods of

Evaluation

● End Semester Assessments – 50%


Recommended

Reading

● MacDonald, M. (2010). Excel 2010: Missing Manual,1st ed., O’Reilly

Media, Inc

● Walkenbach, J. (2010). Excel 2010 Bible,1st ed., John Wiley & Sons, Inc.

● Winston, W. L. (2011). Data analysis and business modeling,1st ed.,

O’Reilly Media, Inc.

Course Code &

Title

FE 2103 Financial risk Management I

Credit Value &

Lecture Hours

30L 2C


Objective To provide basic knowledge in financial risk and tools in financial risk

management.

Learning

Outcomes


● Describe various types of financial risk and risk management tools.

● Define and quantify risk measures.

● Compute, model the risk and implement in spreadsheets.

Course Content Defining Financial risks, Financial market participants and their roles, Types of

Risk; Market Risk, Interest Rate Risk, Credit Risk, Operational Risk, Fixed

Income Risk, Credit risk Models, Available Tools and Utilities, Quantification of

Risk/Risk Measures, Risk management concepts, Types of Risk management

tools and their limitations, Durations and interest rate volatility, Duration

Matching, Nonlinearity and convexity risk, Vega risk, Assets and Liabilities,

Value at Risk and Computations, Volatility estimation, Modes of computation;

parametric, historical, Spreadsheet computation.

Methods of

Evaluation


● Final Examination – 60%

Recommended

Reading

● Allen, S. L. (2012). Financial Risk Management: A Practitioner's

Guide to Managing Market and Credit Risk, 2nd ed., Wiley.

Course Code &

Title

FE 2104 Investment Analysis I


16

Credit Value &

Lecture Hours

30L 2C


Objective To provide basic concepts of financial instruments.

Learning

Outcomes


● Interpret and identify the loan repayment methods, bonds and stocks as

investment instruments.

● Apply basic quantitative methods to price the bonds and stocks.

● Apply the valuation methods to identify feasibility of the given project.

Course Content Introduction to corporate finance and related applications, Corporate Securities as

contingent claims on total firm value, The corporate firms, Goals of the corporate

firm, Financial Markets, varying interest rate valuation, Annuity valuation,

Amortization and sinking fund, Internal rate of return and its applications, Bond

valuation and analysis, stock valuation, foreign currency rate.

Methods of

Evaluation


● Mid Semester Exam – 20%



Recommended

Reading

● Kellison, S. G. (2009). The Theory of Interest, 3rd ed., McGraw-Hill

Irwin.



Sons, Inc.

● Capinski, M., & Zastawniak, T. (2003). Mathematics for Finance: An

Introduction to Financial Engineering, Springer.

● Ross, S., Westerfield, R., & Jaffe, J. (2005), Corporate Finance,

McGraw-

Hill, Irwin.

Course Code &

Title

FE 2105 Management Science II

Credit Value &

Lecture Hours

30L, 2C


Objective To provide basic concepts of optimization tools for real problems.

Learning

Outcomes

At the end of the course students able to;

● Apply dynamic programming methods to solve real world problems.

● Use excel solver to find the Shortest path.

● Apply the optimization method to find the optimum solutions.

Course Content Introduction to Dynamic Programming, Shortest path problem, Solution to Linear

Programming problem through Dynamic Programming, capital budgeting

problem, Reliability improvement problem, Excel (or equivalent software)

solvers for problems, Classical optimization techniques for Finance and

Economics problems (including Lagrange Multipliers), Sensitivity analysis of the

problems.


17

Methods of

Evaluation ● Continuous assessment - 40%


Recommended

Reading

● Hillier, F.S. and Lieberman, G.J. (1995). Introduction to operations

research. New York, N.Y.: McGraw-Hill.

● G. Sirivasan. (2017). Operations Research: Principles and Applications,

3rd ed., Delhi,: PHI Learning Private Limited.

Course Code &

Title FE 2106 Financial Econometrics

Credit Value &

Lecture Hours

30L 2C


Objective To provide basic econometric techniques to model financial data.

Learning

Outcomes


● Identify and describe essential econometrics tools to model financial data.

● Apply the tools and interpret the results.

Course Content Scatter plots and correlations, Simple linear regression, multiple linear

regression, Coefficient of Determination, ANOVA, T-distribution and T-test, F-

distribution and F-test, Hypothesis testing on regression, Non linear models,

dummy variables, EXCEL functions for regression, cross sectional and panel

data, time series and forecasting basics, smoothing techniques, auto correlations,

EXCEL functions for time series data.

Methods of

Evaluation



Recommended

Reading

● Weisberg, S. (2005). Applied Linear Regression (3rd ed.). John Wiley &

Sons, Inc.

● Brockwell, P.J., & Davis, R.A. Introduction to time series and

forecasting.

● Enders, W. (2008). Applied Econometric Time Series (2nd ed.). Wiley

India Pvt. Limited.

Course Code &

Title

FE 2107 Insurance for Business

Credit Value &

Lecture Hours

30L 2C

Prerequisite None

Objective To give students a basic background of the modern insurance system and to

appreciate the role of insurance within the wider field of Financial Services.


18

Learning

Outcomes


● Identify key social and economic drives that causes different risks.

● Identify and describe the fundamental principles and practices of

insurance.

● Identify and explain how various insurance products meet specific client

needs.

Course Content Evolution of Insurance-Historical and Futuristic Overview, Purpose and need for

Insurance, Environmental-Socio economic and technological transitions and their

impact on the Insurance Industry, Historical evolution, scope, underwriting and

claims management of selected classes of Insurance:- Life, Property, Liability,

Marine, Motor, Role of insurance in the development of economy , Concept of

Insurance and Principles of Insurance, Risk and Insurance, Risk assessment and

developing new products, Pricing mechanism in the open market, Appreciation of

Actuarial Aspects, Legal Aspects, Basic Principles of law of contract and its

application to insurance contract, obligations of parties, Consumer protection and

statutory regulations related to insurance business in Sri Lanka, Dispute

resolution, Practice of Reinsurance, Issues in reinsurance in international markets,

Insurance Market, role played by the intermediates-brokers, agents, Market

Cycles.

Methods of

Evaluation



Recommended

Reading

● Thoyts, R. (2010). Insurance Theory and Practice Paperback. Routledge.

● Outreville, J.F. (1998). Theory and Practice of Insurance. Springer

Science & Business Media.

Course Code &

Title

FE 2108 Investment Analysis II

Credit Value &

Lecture Hours

30L 2C


Objective To provide basic concepts of financial decision making techniques.

Learning

Outcomes


● Identify and compute the impact of interest variation.

● Compute the spot rates, forward rates and identify their meaning.

● Compute the duration and convexity of the investment projects (bond)

and interpret their economical meaning.

● Apply the valuation methods to identify feasibility of the given project.

Course Content Introduction to financial analysis, pricing a bond and sensitivity of it, zero

coupon bonds and their features, par yield, spot rates, forward rates, term

structure of interest rate, yield rate, duration and convexity of the bond, fund

analysis, time weighted and time weighted rates, holding rates, Excel

computation and solvers.

Methods of

Evaluation





19


Recommended

Reading

● Kellison, S. G. (2009). The Theory of Interest,3rd ed., McGraw-Hill

Irwin.



Sons, Inc.



● Ross, S., Westerfield, R., & Jaffe, J. (2005). Corporate Finance.

McGraw-Hill, Irwin.

Course Code &

Title

FE 2109 Survival Models and Analysis

Credit Value &

Lecture Hours

30L 2C


Objective To introduce some of the fundamental ideas and issues of lifetime and time-to-

event data analysis, as used in actuarial practice.

Learning

Outcomes


● Identify and describe the key features of lifetime data.

● Model the warranty period.

● Model human mortality and interpret the life table in a variety of

contexts.

● Solve problems, and especially to apply ideas learned in one context to

other contexts.

Course Content Introduction to concepts of survival modeling; censoring; survival and hazard

functions, Estimating the survivor function, present value an actuarial present

value concepts, general survival models, Models for human mortality;

Comparison of models of mortality: Binomial, Poisson and multiple-state

models, Survival distributions and Life Tables: Probability for the age-at-death,

the survival function, Time-until-death for a person age x, Curtate-future-

lifetimes, Force of Mortality, Some analytical laws of mortality, Life

expectancy.

Methods of

Evaluation



Recommended

Reading

● Gerber, H. (1997). Life Insurance Mathematics, 3rd ed.,Springer-Verlag,

New York.

● Dickson, D. C. M., Hardy, M. R., & Waters, H. R. (2013). Actuarial

Mathematics for Life Contingent Risk. Cambridge University Press.

Course Code &

Title

FE 2110 Differential Equations II for Finance


20

Credit Value &

Lecture Hours

30L 2C


Objective To provide essential concepts in partial differential equations to model and solve

problems in finance.

Learning

Outcomes


● Solve partial differential equations using various techniques and interpret

the solutions.

● Model finance related problems using partial differential equations and

interpret the solutions in relation to finance and economics.

Course Content Introduction to Partial Differential Equations, Problem Formulation using PDEs,

Classifications of PDEs, Parabolic Equations, Linear Parabolic Equations,

Fundamental Solution of Parabolic Equations, Applications in Finance and

Economics, Heat equation and its applications, Analytical and numerical

methods to solve Heat equation, MATLAB programing for solving the heat

equation.

Methods of

Evaluation


● Final Exam Computer Based - 60%

Recommended

Reading

● Basov, S. (2007). Partial Differential Equations in Economics and

Finance. Nova Publishers.

● Stanoyevitch, A. (2005). Introduction to Numerical Ordinary and

Partial Differential Equations Using MATLAB®. John Wiley & Sons,

Inc.

Course Code &

Title

FE 2111 Life Insurance Models

Credit Value &

Lecture Hours

30L 2C


Objective To introduce basic life insurance models.

Learning

Outcomes


● Model the future lifetime.

● Compute the net single premium and premium for the different life

policies.

● Compute the gross premiums and analyze the feasibility.

Course Content Review of concepts of survival mode and future lifetime, Survival distributions

and Life Tables, Actuarial present value, Valuing contingent payments

annuities, pure endowment, term, endowment, whole life policies and their

characteristics, Computing net single premium and premium, Fully discrete,

Semi-continuous, Fully continuous life models.

Methods of

Evaluation



Recommended

Reading

● Gerber, H. (1997). Life Insurance Mathematics (3rd ed.).

Springer-Verlag, New York.


21

● Dickson, D. C. M., Hardy, M. R., & Waters, H. R. (2013). Actuarial

Mathematics for Life Contingent Risk. Cambridge University Press.

Course Code &

Title

FE 2112 Fuzzy Modeling

Credit Value &

Lecture Hours

60P 2C

Prerequisite None

Objective To introduce basic uncertainty modeling concepts and models

Learning

Outcomes


● Identify uncertainty models.

● Apply fuzzy techniques to model uncertainty events.

● Compute decisions and evaluate feasibility.

Course Content Traditional logic vs Fuzzy logic, point vs interval estimation, fuzzy numbers,

fuzzy membership functions, fuzzy rules, fuzzy applications in real world

problems, fuzzy based techniques to solve real problems.

Methods of

Evaluation



Recommended

Reading James J. Buckley, Leonard J. Jowers (2006), Simulating

Continuous Fuzzy Systems, Springer-Verlag Berlin Heidelberg

Course Code &

Title

FE 2113 Financial Statement Analysis

Credit Value &

Lecture Hours

30L 2C


Objective To provide basic knowledge on financial statements and their characteristics.

Learning

Outcomes


● Identify financial ratios.

● Compute the financial ratios using statements.

● Interpret and use the financial ratios for decision making process.

Course Content Introduction to Financial Statements, Types of Financial statements, Financial

statements analysis, Horizontal Analysis, Vertical Analysis, Common-Size

Statements, Trend Percentages, Ratio Analysis, Types of Ratios, Liquidity

Ratios, Equity Ratios, Profitability Tests, Market Tests, Current Ratio, Acid-test

Ratio, Accounts receivable turnover, Inventory turnover, Total assets turnover,

Return on Operating assets, Profit Margin, Return on Average Common

stockholders’ equity, Cash flow margin, Working Capital, Net Income to Net

Sales.

Methods of

Evaluation




22

Recommended

Reading

● Alvarez, F. & Fridson, M. Financial Statement Analysis: A

Practitioner's Guide.

Course Code &

Title

FE 2114 Numerical Methods II for Finance

Credit Value &

Lecture Hours

60P 2C

Prerequisite FE 1113 and FE 1115

Objective To provide computer programming competencies to solve differential equations

in numerically.

Learning

Outcomes


● Identify the numerical algorithms for differential equations models.

● Write and implement computer programs for numerical algorithms.

● Apply numerical and programming tools to solve real world problems.

Course Content Numerical Methods for Linear Systems; Direct Methods (Gaussian, Jacobi,

Gauss-Seidel), Iterative Methods, Simple Iteration, Numerical Methods for

ODEs, Euler Method, Runge-Kutta Method, Linear Multi-step Methods and

their Convergence with Applications in Finance, Numerical methods for growth

models, MATLAB Codes for described Numerical Methods.

Methods of

Evaluation


● Final Exam Computer Based - 50%

Recommended

Reading

● Griffiths, D. F., & Highamm, D. J. (2005). Numerical Methods for

Ordinary Differential Equations: Initial Value Problems. Springer

Science & Business Media.

● Stanoyevitch, A. (2005). Introduction to Numerical Ordinary and

Partial Differential Equations Using MATLAB®. John Wiley & Sons,

Inc.

Course Code &

Title

FE 2115 Game Theory

Credit Value &

Lecture Hours

30L 2C

Prerequisite None

Objective To provide the knowledge on decision and behavior rules.

Learning

Outcomes


● Identify the characteristics of different decision models.

● Describe and compute optimality situations.

● Apply game theory models to solve finance and economic problems.

Course Content Generalized the Financial Decision Problems, Introduction to Game Theory and

its applications in Finance, Economics and other Disciplines, Various Classical

Games (Zero Sum, Battle of Sexes, Prisoner’s Dilemma) and their applications,

Types of game: Perfect/Imperfect information, Simultaneous/Sequential,

Dynamic/Stochastic, Repeat Games, Nash Equilibrium, Pareto equilibrium, Pure

and mixed Strategy, Bargaining, Sealed bid Auction, Duopoly Problem, Cournot

https://www.google.lk/search?tbo=p&tbm=bks&q=inauthor:%22David+F.+Griffiths%22

https://www.google.lk/search?tbo=p&tbm=bks&q=inauthor:%22Desmond+J.+Higham%22


23

and Bertrand competition, Financial Simulation and Game Theory, Prisoners’

Dilemma game its direct applications to Economics and Finance, Entry

deterrence.

Methods of

Evaluation



Recommended

Reading

● Pastine, I. & Pastine, T. (2017). Introducing Game Theory: A Graphic

Guide, Icon Books Ltd.

● Funke, C. (2007). Applying Game Theory in Finance. GRIN Verlag.

Course Code &

Title

FE 3101 Investment Analysis III

Credit Value &

Lecture Hours

30L 2C


Objective To provide advance concepts of investment analysis techniques.

Learning

Outcomes


● Identify and interpret the project evaluation tools.

● Apply such methods and identify the feasibility of the given projects.

● Develop and analyze decision models to rank the projects.

Course Content Introduction to discounted cash flow analysis, NPV, IRR, Payback Period,

Discounted Payback Period, and Related Investment decision Criteria,

Incremental cash flows, Inflation and Capital Budgeting, Capital Market theory,

Returns, Risk Statistics, Cost of Capital and Capital Budgeting, Maximizing

firm value versus Maximizing Stockholder interests, Taxes, Adjusted present

value approach, Capital budgeting with estimated rate of discount, Economic

life of an asset, Determination of Economic life of an asset, Replacement and

maintenance analysis, Excel computation.

Methods of

Evaluation





Recommended

Reading

● Kellison, S. G. (2009). The Theory of Interest,3rd ed., McGraw-Hill

Irwin.



Sons, Inc.



● Ross, S., Westerfield, R., & Jaffe, J. (2005). Corporate Finance.

McGraw-Hill, Irwin.


24

Course Code &

Title

FE 3102 Financial Risk Management II

Credit Value &

Lecture Hours

30L 2C


Objective To provide advanced concepts of financial risk management.

Learning

Outcomes


● Identify suitable financial instruments for risk management and their

valuation.

● Compute the risk and develop hedging strategies using instruments.

● Solve risk management problems using spreadsheets.

Course Content Types of Financial instruments and their valuations, Forwards and Futures,

Options, Risk Modeling of Financial Instruments, Stress testing and simulation,

Black Scholes Pricing, Option Greeks, Measuring credit risk and the probability

of default, Short Selling, Operational risk, Developing a hedging strategy and its

applications, Financial crises, Bubbles, Extreme Volatility, Financial Market

behavior during extreme events, Applications using spreadsheets.

Methods of

Evaluation


● Final Examination) – 60%

Recommended

Reading

● Allen, S. L. (2012). Financial Risk Management: A Practitioner's

Guide to Managing Market and Credit Risk (2nd ed.). Wiley.

● Overdahl, J. A., & Kolb, R. W. (2009). Financial Derivatives:

Pricing and Risk Management,1st ed., Wiley.

Course Code &

Title

FE 3103 Computational Modeling

Credit Value &

Lecture Hours

60 P 2C


Objective To provide theoretical and practical knowledge, on building and using

computational models based on soft programming techniques.

Learning

Outcomes

At the end of this course students are able to;

● Compare hard computing methods with soft computing methods and

choose the appropriate method for solving a given problem.

● Describe how Artificial Neural Network (ANN) functions. Implement

an ANN to solve classification and prediction problems using

programming languages.

● Describe how Genetic Algorithms (GA) functions. Implement a GA to

solve optimization problems using programming languages.

● Design and implement GA/ ANN hybrid systems.

● Use Monte-Carlo simulations to solve appropriate problems.


25

Course Content Introduction to Artificial Neural Networks (ANN), Single Layer Networks,

Multilayer Networks. Different learning rules. Advantages and limitations of

ANN. Preprocessing and post processing of data. Using ANN to solve real

world problems.

Introduction to Genetic Algorithms (GA) with advantages, disadvantages and

limitations. Encoding data to genes. Cross overs, mutations and other

generation creation techniques. Different selection methods. Solving TSP and

knapsack problems. Using ML to implement GA to solve problems.

Different hybrid mechanism. Implement a GA ANN hybrid. Advantages of a

hybrid.

Introduction to Monte Carlo simulations (MC), its applications. Using ML to

implement a MC to model real world problems.

Methods of

Evaluation

● End Examination - 50 %

● Continuous Assignments - 50 %

Recommended

Reading

● Priddy, K. L., & Keller, P. E. (2005). Artificial Neural Networks: An

Introduction. SPIE Publications.

● Michalewicz, Z. (1996). Genetic Algorithms + Data Structures =

Evolution Programs,3rd ed.,Springer-Verlag Berlin Heidelberg.

● Haupt, R. L., & Haupt, S. E. (2004). Practical Genetic Algorithms,

2nd ed., Wiley-Interscience.

● Thomopoulos, N. T. (2013). Essentials of Monte Carlo Simulation.

Springer-Verlag, New York.

Course Code &

Title

FE 3104 – Management Science III

Credit Value &

Lecture Hours

30 L 2C


Objectives To provide basic concepts of Queuing Theory and Quadratic Programming.

Learning

Outcomes


● Develop a queuing model for real problem and compute steady-state

measures of performance of single and multi-server models.

● Develop a quadratic programming model for real problems.

● Apply the KKT methods for solving quadratic programming problems.

Course Content Operational techniques for Finance and Economics, Queuing theory and its

applications to Finance and Banking sectors, Introduction to Quadratic

Programming, Applications of Quadratic Programming in Finance and

Economics, Problem formulation, Constrained quadratic programming

problems, Equality constrained quadratic programming, KKT matrix and

reduced Hessian, Global minimizer, Direct solution of the KKT system and

various methods to solve KKT system.

Methods of

Evaluation



Recommended

Reading

● Hillier, F. S., & Lieberman, G. L. (2009). Introduction to Operations

Research,9th ed., McGraw-Hill, New York.

● Taha, H. A. (2009). Operations Research, 8th ed., Pearson Prentice

Hall.

https://spie.org/profile/Kevin.Priddy-5478

https://spie.org/profile/Paul.Keller


26

Course Code &

Title

FE 3105 Stochastic Calculus for Finance

Credit Value &

Lecture Hours

30L 2C


Objective To provide essential concepts in stochastic calculus for option pricing and

related problems in finance.

Learning

Outcomes

End of the course students able to;

● Calculate option prices based on Binomial tree and other techniques in

stochastic calculus.

● Simulate the stock prices using Brownian motion and interpret outcomes.

Course Content Introduction to Stochastic Processes and their applications, Binomial Tree,

Normal and Lognormal random variables, Discrete and Continuous Time

Martingales, Brownian Motion, Model of Fair Game, Introduction to Stochastic

Differential Equations and their application in Finance, Introduction to Wiener

Process and its applications in Finance.

Methods of

Evaluation

● Continuous assessment - 30%

● Practical test - 20 %

● End of semester written examination - 50%

Recommended

Reading

● Hull, J. C. (2005). Futures and other Derivatives, 6th ed., Prentice Hall.

Course Code &

Title

FE 3106 Banking and International Finance

Credit Value &

Lecture Hours

30L 2C

Prerequisite None

Objective To provide practical experiences in banking industry.

Learning

Outcomes

End of the course students able to;

● Identify the banking systems and main operations.

● Describe the banking operations.

● Use banking operations for financial activities.

Course Content Introduction to Banking systems, Bank Liquidity management, Bank Asset and

Liability Management, Banking history, Banking regulations, The Savings and

Loan Crisis, The Supply of Money; Multiple Deposit Creation, Determination of

the Money Supply, Depositor and Bank behavior, Monetary base, Exchange

Rates, Foreign Exchange Markets, International Finance, Transactions motive,

Speculative motive, How does Money affect the Economy.

Methods of

Evaluation

● Continuous assessment - 60%

● End of semester written examination - 40%


27

Recommended

Reading

● Szulczyk, K. R. (2013). Money, Banking, and International Finance, 2nd

ed., CreateSpace Independent Publishing Platform.

● Sercu, P. (2009). International Finance: Theory into Practice. Princeton

University Press.

Course Code &

Title

FE 3107 Portfolio Management

Credit Value &

Lecture Hours

30L, 2C


Objective To provide the essential concepts and knowledge on financial portfolios to

construct and optimize a simple portfolio.

Learning

Outcomes

At the end of this course a student should be able to;

● Describe the concept of return and risk and to compute return related

ratios and interpret the outcomes.

● Compute portfolio return and volatility.

● Use programing language to construct an optimal portfolio with respect

to constraints and interpret the outcomes.

Course Content Introduction to Financial Portfolio, Holding Period of Return and Yield,

Investment Policy Statement: construction and management, Portfolio Returns

and Risk Measures, Sharp Ratio, Information Ratio and other Extended Risk

Measures, Minimum variance frontier and its applications, changes with

respect to utility, Portfolio proportion in two dimensions, Modeling Returns,

Criterion for Portfolio Construction and Asset Allocation, Portfolio

Construction and Optimization using programing languages with constraints.

Methods of

Evaluation

Continuous Assessment

● Classroom test - 20%

● Group Case Study - 10%

● Computer Based Classroom Test (MATLAB) – 20%

● End Semester classroom test – 20%

● End Semester online test – 30%

Recommended

Reading

● Reilly, F. K., & Brown, K. C. (2002). Investment Analysis and Portfolio

Management, 7th ed., Cengage Learning.

● Kim, D., & Chincarini, L. B. (2010). Quantitative Equity Portfolio

Management: An Active Approach to Portfolio Construction and

Management, 1st ed., McGraw-Hill Education.


28

Course Code &

Title

FE 3108 E-Commerce

Credit Value &

Lecture Hours

30L 2C

Prerequisite None

Objective To provide a fundamental competency of the different types and key components

on business models in the New Economy.

Learning

Outcomes

At the end of this course a student should be able to;

● Explain the components and roles of the Electronic Commerce

environment.

● Describe E-Commerce payment systems.

● Explain the client/server infrastructure that supports electronic commerce

and to explain basic electronic commerce functions.

Course Content Defining E-commerce, The Development of E-commerce, E-commerce

Marketing, E-commerce Security Issues, E-commerce Security Requirements, E-

commerce Legal Considerations, International Legal Considerations in E-

commerce, E-commerce Implementation Costs, Online Auctions Including EBay

and other Electronic Payment Systems, Global, Social, and Other Issues in e-

Commerce.

Methods of

Evaluation

● Continuous Assessment - 40%

● Final Examination - 60%

Recommended

Reading

● Reynolds, J. (2004). The complete e-commerce book, 2nd ed., CRC

Press.

● Traver, C. G., & Laudon, K. C. (2009). E-commerce: Business,

Technology, Society, 5th ed., Prentice Hall.

● Phillips, J. (2016). Ecommerce Analytics: Analyze and Improve the

Impact of Your Digital Strategy, 1st ed., Pearson FT Press.

Course Code &

Title

FE 3109 Professional Development in Finance

Credit Value &

Lecture Hours

60P 2C

Prerequisite None

Objective Provide writing, oral, and collaborative skills necessary for future business,

professional and academic positions.

Learning

Outcomes


● Deliver effective skills in presentations that may require oral

presentations in Finance.

● Participate effectively in groups emphasizing critical and reflective

thinking.

● Write an academic and professional research report.

Course Content Research Reports and proposals: Develop accuracy (in grammar) and style (so

that messages are effective, efficient, and ethical), Academic writing,

Referencing, Paraphrasing and Summarizing, Interpersonal skills: listening,

questioning and feedback, Oral communication (To deliver oral presentations),

Public communication, Intercultural Communication, Organizational


29

communication, Team communication and Communicating in meetings.

Methods of

Evaluation

● Participation 10%

● Written Communication 10%

● Oral communication- Individual Presentation 20%

● A three page long business research report or proposal 20%

● Oral Communication (plus email evaluation) 20%

● A group/individual presentation 20%

Recommended

Reading

● Eunson, B. (2012). Communication in the 21st Century, 3rd ed., Milton,

Old, John Wiley and Sons Australia, ISBN 9780730302636.

Course Code &

Title

FE 3110 Case Studies in Management

Credit Value &

Lecture Hours

60P 2C

Prerequisite None

Objective Analyzing Management case studies

Learning

Outcomes


● Describe Management theories for organizational problems.

● Analyze organizational problems and interpret solutions.

Course Content Introduction to the case study method, Case study applications for

organizational & managerial issues, Introduction to Human resource

management, job analysis, selection process, performance evaluation, training &

development process, Case studies in Human Resource Management,

Introduction to change management process, forces of change, Barriers in

change management, Case studies in Change management, Introduction to

Marketing management. Marketing environment, Segmentation, Marketing mix.

Case studies in Marketing Management. Introduction to Leadership. Leadership

theories, Communication model, Motivation theories. Case studies in

Leadership Management.

Methods of

Evaluation

Continuous assessment: 100%

Recommended

Reading

● Natarajan, B., & Nagarajan, S. K. (2007). Developing Analytical Skills:

Case Studies in Management. Shroff Publishers and Distributors Pvt.

Ltd.

● Ellet, W. (2007). The case Study Handbook: How to Read, Discuss and

write persuasively about cases. Harvard business school press.

● Kulkarni, J. A., Pachpande, A., & Pachpande, S. (2011). Case studies in

Management. Dorling Kindersley


30

Course Code &

Title

FE 3111 Professional Financial Practice

Credit Value &

Lecture Hours

60P 2C

Prerequisite FE 3110 and FE 3109

O Objective To provide applied analytical financial thinking skills by finance case studies.

Learning

Outcomes


● Apply analytical methods to interpret the solutions for various

stakeholders.

● Develop team building and interpersonal communication through

challenging finance practice.

● Apply and strategize different tasks to achieve investment goals.

Course Content Application of knowledge learnt in Capital budgeting (NPV, IRR), Financial

Statement Analysis (Income statements, Balance sheet and Cash flow

statements) and Ratio Analysis, Industry Analysis (SWOT and PESTAL

Analysis).

Method of

Evaluation

C Continuous Assessment – 100%

Course Code &

Title

FE 3112 Project

Credit Value &

Lecture Hours

180P, 6C

Prerequisite None

Objective Provide an opportunity to utilize learnt competencies

Learning

Outcomes

Identify and model real world problems and interpret the result

Communicate their findings and interpret through the learnt concepts and

theories

Course Content Students are assigned problems and they are expected to work independently

for 6 month duration and present their work based on: Proposal, Literature

review, Methodology, Basic results and final results. At the end of the 6

months the students are expected to submit the report. Students will be

evaluated through a VIVA.

Methods of

Evaluation

Continuous progress 40%

Report : 30%

VIVA : 30%

Course Code & FE 3113 Data Analysis


31

Title

Credit Value &

Lecture Hours

60P 2C


Objective Provide an opportunity to use data analytics to create actionable

recommendations.

Learning

Outcomes

The end of the course students are able to :

● Demonstrate data analysis functions and reporting.

● Analyze and adapt data to feed business decisions.

Course Content Organizing and summarizing data, Summarizing relationship between

variables, Simple linear Regression and Correlation analysis, Multiple

Regression Analysis, Analysis of variance, Analysis of categorical Data, Time

series models and forecasting, case studies in finance and economics

Methods of

Evaluation

● Group Assignment- 50%

● Individual Assignment- 50%

Recommended

Reading

● Kitchens, L. J. (2003). Basic Statistics and Data Analysis. Duxbury

Press.

● Peck, R., Olsen, C., & Devore, J. L. (2016). Introduction to Statistics

and Data Analysis, Cengage Learning; Brooks Cole, Cengag.

● MacFarland, T. W. (2014), Introduction to Data Analysis and

Graphical Presentation in Biostatistics with R. Springer.

bsc in financial engineering (2018 onwards)

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