8/14/2019 MBA FIN 5302 SYL alternative

1/6

University of OklahomaMichael F. Price College of Business

Financial Markets and Securities FIN 5302 200

Evgenia(Janya)Glu!eva"##ice $%252

Fall 20&2 325'2 (*ne)+uesday, +*ursday -.30 &0.30 a/ %3010

325'-- (#a)

"##ice %urs. !y at4 anya6u4edu

Course Overview+*e Invest/ents #cuses n #inancial decisins # individual /arket articiants trying t/ai/i7e t*e returns 8 /ini/i7e t*e risks # t*eir invest/ent rt#li4 +*e curse cvers several

/ar tyes # #inancial instru/ents, all # 9*ic* are actively traded in tday:s #inancial /arkets4+*se include stcks, !nds, and t s/e etent, derivatives4 +*e gal # t*is curse is tintrduce yu t t*ese securities and discuss t*eir rerties and t*eir use, as 9ell as t*eirvaluatin /et*ds4

Special Accommoations! $ny student in t*is curse 9* *as a disa!ility t*at /ay revent *i/r *er #r/ #ully de/nstrating *is r *er a!ilities s*uld cntact t*e instructr ersnally as snas ssi!le s 9e can discuss acc//datins necessary t ensure #ull articiatin and #acilitateyur educatinal rtunities4 +*e ;niversity # "kla*/a is c//itted t rvidingreasna!le acc//datins #r all students 9it* disa!ilities4 Students 9it* disa!ilities 9*re

8/14/2019 MBA FIN 5302 SYL alternative

2/6

(raes+*e curse grade 9ill !e deter/ined !ased n t*e #ll9ing.

+9 rects 300 ints+rading Ga/e 50 intsarticiatin 50 ints

Midter/ 300ints

Final (Nt >/re*ensive) 300 ints+"+$B &000 ints

Make)up *&ams$n ea/ /issed #r a valid reasn /ay !e /ade u 9it*in ne 9eek4 Au 9illneed t /ake arrange/ents 9it* /e regarding t*e ti/e 8 lcatin4 I# yu /iss t*e #inal ea/ andcannt /ake it u !e#re t*e curse grades are due yu 9ill receive an CID (#r Inc/lete),

ending yur taking t*e #inal ea/4

Pro+ects$ssign/ents are due /idnig*t (end) # t*e due date4 ,ate assignments shall notreceive any creit4 rects /ust !e su!/itted electrnically via =r!4

#elpI *ave reserved $% 300, .00 -.00 / n Nve/!er &3 and $% 3&2, .00 -.00 / n=ece/!er 3, t !e availa!le t *el yu 9it* t*e rects4 Au are 9elc/e t c/e t t*ese *elsessins4 I# yu are una!le t c/e t t*ese sessins, let /e kn9. in case yu need *el I cansc*edule an individual aint/ent 9it* yu4

%raing (ameAu 9ill *ave an rtunity t earn 50 ints !y articiating in t*e trading

ga/e n =ece/!er 14 e s*all *ave a c/uter la! sessin #r t9 *urs, 9*ere yu 9ill useinteractive trading s#t9are t trade *yt*etical stcks4 Aur scre 9ill !e deter/ined relative tt*e t*er students, !ased n t*e #ll9ing criteria. (&) Aur level # activity in t*e ga/e (nu/!erand si7e # yur trades), 10 (2) Hersatility # yur trades (/arket, li/it, institutinal rder*andling), 10 and (3) Mney yu /ake in t*e ga/e (20)4

Communicationlease c*eck yur university e/ail accunt regularly4 +*e !est 9ay t reac* /eis via e/ail als4

(rauate AssistantMy graduate assistant is t !e annunced searately4

,ecture Power Pointsare yur /ain guide #r studying It is /y licy t*at I nly test yu nt*e /aterial elicitly cvered in class4 I cannt ssi!ly cver everyt*ing in t*e !k4 %9ever,t*e !k is an i/rtant sule/ent t reading, and an i/rtant surce # ractice r!le/s,s/e # 9*ic* 9ill !e dne in class4

8/14/2019 MBA FIN 5302 SYL alternative

3/6

Class Scheule an "eaing AssignmentsF$- /01)100 Fall 1021

Class %opic "eaings(?die, @ane, and Marcus)#anouts(n *tt.88learn4u4edu)

"ct & Intrductin. Investing Envirn/ent >*aters 2, 3, &2

"ct &- ' 23 isk and return Mean'variance /at*e/atics>*aters 5, =iversi#icatin >/!ining risky rt#li 9it*

a de#ault'#ree security S*are rati and >$B4

Oct 1 (uest Speaker

"ct 30 =iversi#icatin and rt#li >ntinued >*aters 5,

Nv & >$M Inde Mdel >*ater

Nv rt#li Manage/ent and >*aters, 1, &-er#r/ance Evaluatin

-ov 3 M$4%*"M *5AM

Nv &3 ' &5 E*aters &3, &1

Nv 20 =erivatives (Intrductry) >*aters &5, &

-ov 11 %#A-6S($7$-(

Nv 2 ' 2K ?nds >*aters &0, &&

=ec 1 +rading Ga/e

F$-A, *5AM$s sc*eduled !y t*e ;niversity =ece/!er &&

http://learn.ou.edu/http://learn.ou.edu/

8/14/2019 MBA FIN 5302 SYL alternative

4/6

Fall 1021F$- /01 )100 #omework Assignment Sheet

Assignment 1 due Nov 15 (150 points)

I have placed on D2L the monthly price data for five stocks: Apple (AAPL),

Boeing (BA), etfli! ("L#), $al%&art 'tores ($&) and !!on &o*il (#+&)as -ell as the data for the '.P /00 Inde!, over the period 200/ 1 203

3 4alc5late monthly ret5rns on each stock and on the '.P /00324 >alculate t*e average return #r eac* stck and t*eir variance'cvariance /atri434 $ssign t*e 9eig*ts # 20 t eac* stck, i4e4, create an ealculate t*e S*are

rati # t*e rt#li454 ;sing Slver, #ind t*e ti/al rt#li 9eig*ts t /ai/i7e t*e S*are rati # t*e

rt#li4 In rder t d t*at, /ake sure t*at yur 9eig*ts add u t ne via a #r/ula4 N9 #ind t*e ti/al rt#li 9eig*ts using t*e ti/al rt#li #r/ula4 Make sure

t*at t*e ti/al 9eig*ts and t*e ti/al S*are rati yu #ind via t*e #r/ula are veryclse t t*se yu #ind 9it* Slver

4 Fr/ n9 n 9rk 9it* t*e ti/al 9eig*ts4 $ssu/e yur initial invest/ent in t*ert#li is &,000,0004 S*9 yur sitins in eac* stck as 9ell as yur ttal rt#livalue at t*e end # eac* /nt*4 Au 9ill need t re!alance /nt*ly t /aintain t*eti/al 9eig*ts yu *ave #und

-4 >alculate t*e series # /nt*ly returns and cu/ulative returns #r t*e ti/al rt#liand #r t*e SL 500 ver t*e sa/le erid4

K4 >*art t*e cu/ulative returns (t*e series #r t*e ti/al rt#li and t*e series #r t*e/arket inde) n t*e sa/e lt4 uld t*e ti/al rt#li *ave uter#r/ed t*e SL500 inde ver t*e sa/le erid

&04 Esti/ate t*e !eta # t*e ti/al rt#li, assu/ing risk'#ree rate t !e a cnstant 2 eryear (9*ic* /eans, yu dn:t *ave t 9rry a!ut calculating ecess returns)4 uld t*eti/al rt#li *ave !een riskier t*an t*e /arket ver t*e sa/le erid

&&4 >nsider t*e #ll9ing transactin csts assu/ing yu *ave a !rker'assisted, nn'nlineaccunt4a3 03/6 per month interest on an open short position*3 03/6 of the dollar amo5nt traded, *id%ask lossc3 728 flat *roker fee per trade per stock regardless of trade si9ed3 70302 per share traded additional *roker feee3 703000022 per 7 of proceeds if shares are sold (none if *o5ght)

'4 fee

Find t*e #uture value # all transactin csts, c/unding /nt*ly at t*e sa/e rate as t*eeected return # t*e ti/al rt#li (i# yu didn:t *ave t ay transactin csts yu9uld *ave invested t*e /ney in t*e ti/al rt#li instead)4 *at can yu say a!utt*e signi#icance # transactin csts relative t t*e invest/ent gain n yur rt#li

8/14/2019 MBA FIN 5302 SYL alternative

5/6

Assignment 2: Due Dec 4 (150 points)

I have placed on D2L the !cel file -ith the financial statements for'o5th-est Airlines for 200;, 200, and 203 All n5m*ers are in tho5sands

of dollars3 Long%erm De*t? and

>'hort@45rrent Long erm De*t?3

23 Proect the "4" for each follo-ing year, from 202 thro5gh 20203 In

order to do this, make the follo-ing ass5mptions:

a3 ro-th rate in Depreciation !pense -ill *e fi!ed over 202%2020

and eC5al to the gro-th in Property, Plant, and C5ipment for

203

*3 ro-th rate in BI -ill *e fi!ed over 202%2020 and eC5al to thegro-th in otal even5e in 203

c3 a! ate -ill *e fi!ed over 202%2020 and eC5al to the a! ate in

203

d3 ro-th rate in +$4 -ill *e fi!ed over 202%2020 and eC5al to the

gro-th in otal even5e in 203

e3 ro-th rate in 4apital !pendit5res -ill *e fi!ed over 202%2020

and eC5al to the gro-th in Property, Plant, and C5ipment for

203

f3 De*t -ill remain the same, and interest e!pense -ill remain the

same as in 203

8/14/2019 MBA FIN 5302 SYL alternative

6/6

E3 4alc5late the company=s cost of eC5ity capital 5sing the 4AP& and

ass5ming that *eta is 32E, the risk%free rate is 6, and the market

risk premi5m is F3/63

3 Ass5me that the gro-th rate in "4" -ill *e G3/6 post%20203 hat

means, "4" in 202 -ill *e G3/6 higher than "4" in 2020, and so on

forever3 4alc5late the present val5e of all e!pected eC5ity cash flo-s

as of the end of 203 Do + incl5de the 20 "4" into the

val5ation3

54 >alculate t*e intrinsic value er s*are # Sut*9est $irlines given &,000,000 s*ares

utstanding, as # =ec 3&, 20&&4