COURSE INFORMATION
Course Title: BEHAVIORAL FINANCE AND INVESTMENT MANAGEMENT
Code Course Type Regular Semester Theory Practice Lab Credits ECTS
BAF 533 D 3 3 0 0 3 7.5
Lecturer and Office Hours: Kristal Hykaj NA
Second Lecturer(s): NA
Teaching Assistant(s) and Office Hours: NA
Language: English
Compulsory/Elective: Elective
Classroom and Meeting Time: E211
Course Description: The purpose of this course is to provide a strong foundation for the role of financial professionals on issues associated with behavioral finance matters and the relationship between behavioral finance and investment management. This course covers topics of Efficient Market Hypothesis, Investment Environment and Securities Trading, as well as topics of Portfolio and Capital Markets Theory, Security Analysis, Fixed Income Securities, and a thorough examination of Investment Management of these portfolios. This course will help students strengthen their knowledge in regards to the CFA (Certified Financial Analyst) level 1, 2 and 3 examinations.
Course Objectives: Behavioral Finance and Investment Management: The purpose of this course is to provide a strong foundation for the role of financial professionals on issues associated with behavioral finance matters and the relationship between behavioral finance and investment management. This course covers topics of Efficient Market Hypothesis, Investment Environment and Securities Trading, as well as topics of Portfolio and Capital Markets Theory, Security Analysis, Fixed Income Securities, and a thorough examination of Investment Management of these portfolios. This course will help students strengthen their knowledge in regards to the CFA (Certified Financial Analyst) level 1, 2 and 3 examinations.
COURSE OUTLINE
Week Topics
1 Intoduction
2 Finance Decision Making
3 Discounting
4 Learning
5 Bubbles
6 Noise Traders
7 Overconfidence and Optimism
8 Mid term Exam
9 Asset pricing under prospect theory
10 Overreaction and/or Underaction
11 Momentum
12 Insider Trading
13 Equity premium puzzle
14 the market for Information, Noise and Deception
Prerequisite(s): NA
Textbook: Behavioural Finance William Forbes
Other References: NA
Laboratory Work: NA
Computer Usage: NA
Others: No
COURSE LEARNING OUTCOMES
1 Comprehend the role of utility in financial decision making
2 Comprehend the contribution of behavior in the formation of financial turmoil.
3 Clearly identify the difference between modern finance theory and financial choices under the effect of behavioral patterns
4 Advance the knowledge in prospect theory
5 Understand the Equity premium puzzle.
COURSE CONTRIBUTION TO... PROGRAM COMPETENCIES
(Blank : no contribution, 1: least contribution ... 5: highest contribution)
No Program Competencies Cont.
MSc BAF Program
1 The students are gained the ability to look at the problems of daily life from a broader perspective. They gain the needed skills not only to understand economic problems in banking and finance but also to construct a model and defend in meaningful way. 3
2 They have knowledge about the finance and banking. 5
3 They have knowledge about the money and banking. 5
4 They have knowledge about the international finance and banking. 3
5 They have ability to use mathematical and statistical methods in banking and finance. 2
6 They know how to use computer programs in both daily office usage and statistical data evaluations in banking and finance department.
7 They have necessary banking and finance skills that needed in private and public sector.
8 They are intended to be specialist in one of departmental fields that they choose from the list of general economics, finance economics, public finance, corporate finance, finance management, international finance markets and institutions, banking and central banking, international finance and banking, money and banking, international trade and banking.
9 They have ability to utilize fundamental economic theories and tools to solve economic problems in banking and finance.
10 They are aware of the fact that banking and finance is a social science and they respect the social perspectives and social values of the society’s ethics.
COURSE EVALUATION METHOD
Method Quantity Percentage
Homework
0
0
Midterm Exam(s)
1
25
Project
1
20
Quiz
0
0
Final Exam
1
45
Attendance
10
Total Percent: 100%
ECTS (ALLOCATED BASED ON STUDENT WORKLOAD)
Activities Quantity Duration(Hours) Total Workload(Hours)
Course Duration (Including the exam week: 16x Total course hours) 15 3 45
Hours for off-the-classroom study (Pre-study, practice) 13 5 65
Mid-terms 1 20 20
Assignments 1 15 15
Final examination 1 5 5
Other 0
Total Work Load:
150
Total Work Load/25(h):
6
ECTS Credit of the Course:
7.5