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Dr Peter D Hahn or “Pete”Faculty of Finance

Cass Business SchoolRoom 5012

106 Bunhill Row

Principles of Finance

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The real world of finance isn’t about numbers as many of you think but about how we utilise information

about the flows of money.

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Finance

• Finance tries to turn data (sometimes soft data) into measurable factors of risk and return.

• But it also involves a lot of judgment.

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How will we learn?– It’s a combination of what you read and what we talk about

in class. The class part is important.

– I will try and make it more relevant for you. I want to talk a lot about how we apply finance.

– I may be a bit different from some of your other professors.

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Aims of the Module • The main objective is to

understand how broad finance is as a subject.

• To help you chose further courses in finance.

• To help you think about or anticipate finance questions that might come up on your job interviews.

• Students participation is largely in tutorials but I will ask questions in my lectures.

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Reading List for the Module

Principles of Corporate Finance (2010) by Brealey, Myers, and Allen, 10th Global Edition, McGraw-Hill.

• Try and read the Financial Times each day or look at the website. For the adventurous, try the Wall Street Journal Europe.

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Weekly Reading Assignments(note that some lectures extend into the following sessions)

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Week Topic Reading    Brealey, Myers & Allen

1 Intro & Basics of Finance* 1-2.12 Present Values Expanded 2.3-3.13 Bonds* 3.2-3.6, 23 (pp. 605, 607), 24.1

4 Shares 4-4.4 (omit p.105), 5-5.4, 16-16.3, 14.3, 25-25.3 (omit Avoiding the

Alternative Minimum Tax)5 Corporate Review*

6 Risk 7-7.57 Return 8-8.3 (8.4 is optional)8 Efficient Markets & Behaviour 13-13.5

9 Derivative Securities Introduction*

20-20.3, pp. 673-674, 680-686, 688-689

10 Derivative Securities II 21-21.611 Review & Conclusions  

*Additional REQUIRED newspaper reading assignments are in the course outline!

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Assessment of the Course• Students are assessed via two tests or quizzes and final

examination. The two quizzes constitute 30% of final mark and final exam constitutes 70% of the final mark.

• Quizzes will be scheduled as best possible after weeks 5 and 8.

• All quizzes and exams are multiple choice, however, they include problem solving (calculation necessary for some answers).

• Before the final, you will have attempted circa 150 sample questions from tutorials and quizzes.

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Tutorial Sessions

There are many groups that meet separately.

1. You should prepare the questions that have been provided in your packages.

2. These problems and their solutions will be reviewed at the sessions. There is an opportunity for you to ask questions.

3. Following the sessions, solutions will be posted on the Moodle.

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CLASS RULES

• Avoid laptops…and phones…

• Bring a calculator.

• My office hours:

Mondays 1:30-3:30pm

Room 5012

Cass – Bunhill Row

(exceptions are posted on the Moodle)

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