25729 Applied Portfolio Management

Faculty of Business: Finance and Economics
Credit points: 6 cp

Subject level: Postgraduate

Result Type: Grade and marks

Requisite(s): 25721 Investment Management OR 25741 Capital Markets
These requisites may not apply to students in certain courses.
There are also course requisites for this subject. See access conditions.

Handbook description

This is an integrating subject concerned with the process of combining the various asset classes into investment portfolios. The student is introduced to the whole chain in the process from the identification of the investors' need to the construction of the portfolio to the evaluation of its performance. Special emphasis is given to the added complexities of offshore investing.

Subject objectives/outcomes

On successful completion of this subject students should be able to:

Comprehend the latest developments in share market analysis and develop skills necessary to assess a variety of financial information for investment purposes.
Have a better understanding of how to best select stocks for inclusion in portfolios.
Use fundamental, technical and contrarian approaches to identifying mispriced stocks, the course will also consider a number of other considerations in selecting stocks.
Understand the basic characteristics of the major and alternative asset classes.
Have a good understanding of the complexities of managing offshore investments.
Define the investment needs of clients and be able to utilise techniques to design investment portfolios to meet these needs.
Measure and interpret the performance of the portfolios including breaking this performance down by asset class.

Contribution to graduate profile

The course contributes along with a number of others in providing a student with a general framework for the analysis and selection of equities and a detailed understanding of managing portfolios with each of the major investment classes. The subject tackles the problem of valuation of equities using a number of approaches including fundamental, technical value and momentum strategies. It reviews the knowledge gained in previous courses with respect to the characteristics of the various asset classes – domestic and overseas equities, fixed income securities and real estate – and also introduces some alternative investment classes.

Teaching and learning strategies

The subject will be taught using a combination of lectures and workshops. These classes will be supplemented with both printed and electronic learning materials and resources. UTS Online will be used to share information and encourage interaction between staff and students. Students will also use appropriate computer software such as spreadsheets and word processors to complete assigned tasks.

Content

The Role of Investment Managers
The Asset Classes
Alternative Investments
Offshore investing
Portfolio construction and risk control
Tactical asset allocation
Performance measurement.

Assessment

Simulation and Case Study	35%
This assignment is designed to assess students' understanding of the theories and concepts to demonstrate that students have met objectives 1-4.
Assignment	15%
The individual assignment is designed to assess students' understanding of the theories and concepts to demonstrate that students have met objectives 5-7.
Examination	50%
This exam will test students' understanding of the theory and their ability to apply the theory to financial management decisions. This will enable students to demonstrate that they have met objectives 1-7.

Recommended text(s)

Comprehensive readings distributed by lecturer.

Indicative references

Bodie, Z., Kane, A. and Marcus, A.J. (2002), Investments, 5th ed., Irwin McGraw-Hill.

Elton, E.J., Gruber, M.J., Brown, S. and Goetzman, W. (2003), Modern Portfolio Theory and Investment Analysis, 6th ed., John Wiley and Sons.

Haugen, R.A. (1995), The New Finance: The Case against Efficient Markets, Prentice Hall.