This course has been designed for students studying Corporate Finance at the under-graduate or post-graduate level.
The topics covered are - Portfolio theory, Capital Asset Pricing model theory and Miller and Modigliani theory.
- First year in Accountancy
Students will learn how to calculate risk and return for a portfolio and a single asset investment.
Also learn how to construct a Portfolio, CAPM and Miller Modigliani diagrams.
- Construct portfolios for two projects and calculate their risk and expected return
- Graphically illustrate the combination of two or more portfolios
- Explain the derivation and rationale of the Capital Market Line
- Explain why diversification lowers risk and the meaning of Beta
- Explain the difference between the Capital Market Line and the Security Market Line
- Construct the Security Market Line
- Explain the difference between expected and required return
- Discuss the limitations of CAPM for capital budgeting decisions