IC212: Financial Modelling

Module code: IC212

Module provider: ICMA Centre; Henley Business School

Credits: 20

Level: 5

When you'll be taught: Semester 1

Module convenor: Dr Gita Persand, email: gita.persand@icmacentre.ac.uk

Module co-convenor: Dr Yoke Yue Kan, email: y.y.kan@henley.edu.my

Pre-requisite module(s):

Co-requisite module(s):

Pre-requisite or Co-requisite module(s):

Module(s) excluded:

Placement information: na

Academic year: 2024/5

Available to visiting students: Yes

Talis reading list: No

Last updated: 19 November 2024

Overview

Module aims and purpose

This module aims to put various finance theories, which were studied at Part 1 Introductory Finance, into practice with the use of Microsoft Excel functions, hence providing students with an opportunity to apply their theoretical knowledge, when using Excel, to solve some real-life financial problems. Students will be able to implement the concept of capital budgeting, time value of money, construct portfolios, run regressions in order to estimate the Capital Asset Pricing Models, and calculate the prices of bonds, stocks and options among others.

The module lead at the University of Reading Malaysia is Dr Yoke Yue Kan.

Module learning outcomes

By the end of the module, it is expected that students will be able to:

• apply the functions of Microsoft Excel to the financial concepts that were studied in Part 1 IC102 Introductory Finance.
• solve practical financial problems in areas of Finance such as Asset and Derivative Pricing, Portfolio Management, Time Value of Money, and the Capital Asset Pricing Model.
• gain teamwork skills while working on the group project as well as time management skills when taking the practical test.

Module content

1. Statistical analysis and time series regression
2. Financial arithmetic and the time value of money
3. Equities
4. Bonds
5. Portfolio Management
6. Capital Asset Pricing Model
7. Project – Portfolio Optimisation/Bond Immunisations
8. Options pricing
9. Mock Test
10. Revision

Structure

Teaching and learning methods

Teaching for both the lectures and seminars take place in a computer lab as students will need access to Excel to undertake their learning activities.

Lectures are interactive - Module Convenor demonstrate how to apply the financial concepts on Excel first before students would replicate them. Students will call the Module Convenor to their computers if they are facing any challenges while working with Excel.

Students are given seminar questions in advance, and they have to make an attempt at those questions on Excel before the seminars. The Teaching Assistants will be helping them if they are unable to answer those questions during the seminars. 

The Module Convenor and Teaching Assistants are available throughout the semester to help students during their office hours. This can be face-to-face or online.

This module may be taught in a different Semester if you are studying at our campus in Malaysia.

For students studying at our campus in Malaysia: This module may be taught in a different semester and the breakdown of study hours may differ to those set out in the Study Hours table (please refer to the Module Handbook for the correct breakdown). In addition, you will be required to complete an additional 40 hours of study, taking the total number of study hours to 240 for this module. This is to comply with the Malaysian Quality Agency (MQA).

Study hours

At least 35 hours of scheduled teaching and learning activities will be delivered in person, with the remaining hours for scheduled and self-scheduled teaching and learning activities delivered either in person or online. You will receive further details about how these hours will be delivered before the start of the module.

Please note the independent study hours above are notional numbers of hours; each student will approach studying in different ways. We would advise you to reflect on your learning and the number of hours you are allocating to these tasks.

Semester 1 The hours in this column may include hours during the Christmas holiday period.

Semester 2 The hours in this column may include hours during the Easter holiday period.

Summer The hours in this column will take place during the summer holidays and may be at the start and/or end of the module.

Assessment

Requirements for a pass

40% weighted average mark of individual and group assignments

Summative assessment

Penalties for late submission of summative assessment

The Support Centres will apply the following penalties for work submitted late:

Assessments with numerical marks

• where the piece of work is submitted after the original deadline (or any formally agreed extension to the deadline): 10% of the total marks available for that piece of work will be deducted from the mark for each working day (or part thereof) following the deadline up to a total of three working days;
• the mark awarded due to the imposition of the penalty shall not fall below the threshold pass mark, namely 40% in the case of modules at Levels 4-6 (i.e. undergraduate modules for Parts 1-3) and 50% in the case of Level 7 modules offered as part of an Integrated Masters or taught postgraduate degree programme;
• where the piece of work is awarded a mark below the threshold pass mark prior to any penalty being imposed, and is submitted up to three working days after the original deadline (or any formally agreed extension to the deadline), no penalty shall be imposed;
• where the piece of work is submitted more than three working days after the original deadline (or any formally agreed extension to the deadline): a mark of zero will be recorded.

Assessments marked Pass/Fail

• where the piece of work is submitted within three working days of the deadline (or any formally agreed extension of the deadline): no penalty will be applied;
• where the piece of work is submitted more than three working days after the original deadline (or any formally agreed extension of the deadline): a grade of Fail will be awarded.

The University policy statement on penalties for late submission can be found at: https://www.reading.ac.uk/cqsd/-/media/project/functions/cqsd/documents/qap/penaltiesforlatesubmission.pdf

You are strongly advised to ensure that coursework is submitted by the relevant deadline. You should note that it is advisable to submit work in an unfinished state rather than to fail to submit any work.

Formative assessment

Formative assessment is any task or activity which creates feedback (or feedforward) for you about your learning, but which does not contribute towards your overall module mark.

Ongoing feedback throughout the lectures and seminars.

Mock test at the end of Semester 1.

Reassessment

Additional costs