Course Information

Financial markets represent the lifeblood of our global economy. These mechanisms promote greater economic efficiency by transferring funds from individuals, businesses and governments with an excess of available funds to those with a shortage. Funds are transferred in the financial markets through the purchase and sale of financial instruments (such as stocks and bonds). Short-term financial instruments are available in money markets, while longer-term financial instruments are purchased and sold in the world’s capital markets. Many financial markets have been in existence for hundreds of years; however the modern era has brought along many new innovations such as securitization and the derivatives market. This course provides an introductory overview of the world’s largest financial markets, including the money, bond, stock, mortgage, foreign currency and derivatives markets. This course reviews the various types of financial risk that impact these markets, as well as the economic variables that influence m

hapter 1: Financial Markets & Intermediaries 1. Identify the unique characteristics of financial markets. 2. Recognize the types of financial instruments traded in various financial markets. 3. Recognize the key aspects of the efficient market hypothesis. 4. Identify the roles that financial intermediaries play in financial markets; recognize the various types of financial intermediaries. Chapter 2: Interest Rates 1. Calculate ‘simple’ and ‘compound’ interest. 2. Identify how a bond’s stated interest rate and its yield-to-maturity impacts the price at which it is traded. 3. Recognize how interest rates are derived under the ‘loanable funds theory’. 4. Calculate a bond’s yield given specific information regarding its risk structure. 5. Identify how a yield curve illustrates the term structure of interest rates; recognize various yield curve shapes and the theories behind them.