WMEA1000 Applied Finance

Hiroshima University Syllabus

Japanese

Academic Year 2024Year School/Graduate School Graduate School of Humanities and Social Sciences (Master's Course) Division of Humanities and Social Sciences Economics Program

Lecture Code WMEA1000 Subject Classification Specialized Education

Subject Name 応用ファイナンス

Subject Name
（Katakana）オウヨウファイナンス

Subject Name in
English Applied Finance

Instructor ONO SADAYUKI

Instructor
(Katakana) オノ　サダユキ

Campus Higashi-Senda Semester/Term 1st-Year, First Semester, First Semester

Days, Periods, and Classrooms (1st) Thur13-14：Higashi-Senda Lecture Rm M302

Lesson Style Lecture Lesson Style
(More Details) 　

Lecture

Credits 2.0 Class Hours/Week 　 Language of Instruction J : Japanese

Course Level 5 : Graduate Basic

Course Area（Area） 24 : Social Sciences

Course Area（Discipline） 03 : Economics

Eligible Students

Keywords

Special Subject for Teacher Education 　 Special Subject 　

Class Status
within Educational
Program
(Applicable only to targeted subjects for undergraduate students)
Criterion referenced
Evaluation
(Applicable only to targeted subjects for undergraduate students)

Class Objectives
/Class Outline Applied Finance plans to teach (1) fair value for bond, exchange rate, and financial derivatives, (2)relationship between risk and return on financial assets and Capital Asset Pricing Model (CAPM). In class, basic ideas and theory regarding these topics are introduced and analyzed. Additionally, news about financial markets that are shown on economic magazines such as Nikkei (Japanese daily newspaper) might be presented and discussed.

Class Schedule Lecture Topic
(1) Risk and Return: Explains how risk and return are measured and investors' attitudes toward risk.
(2) Capital Asset Valuation Model 1: Describes important assumptions and conclusions of the capital asset pricing model.
(3) Capital asset pricing model 2: Explains in detail investment trusts (funds).
(4) Capital Asset Valuation Model 3: Considers the relationship between risk and return using the capital asset pricing model and finds an appropriate measure of risk.
(5) The Efficient Market Hypothesis: Examines the relationship between asset prices and information held by investors.
(6) Exchange Rate 1: Examines the direct and indirect effects of exchange rates on the returns on foreign assets.
(7) Exchange Rate 2: Introduces three main theories that explain exchange rate movements.
(8) Futures and Forward Trading: Explains the overview of financial derivatives and futures and forward trading.
(9) Option 1: Describes the important aspects of an option on a derivative.
(10) Option 2: Derives the option price relationship from the condition that arbitrage is not possible.
(11) The Black-Scholes-Merton option pricing equation: Introduces the key theoretical formulas for option prices and observes the assumptions, conclusions, and problems.
(12) Exchange rate swap and interest rate swap: Introduces two main types of swaps for derivative financial instruments.
(13) Bond: Describes important issues for one of the major financial assets, bond.
(14) Credit default swaps (CDS): Discusses the fundamentals and fair value of CDS.
(15) Final exam

Text/Reference
Books,etc. As reference,
• Modern Portfolio Theory and Investment Analysis; by Edwin J. Elton, Martin J. Gruber, Stephen J. Brown, William N. Goetzmann
• コーポレートファイナンスの原理; by ステファン・ロス, ランドルフ・ウェスターフィールド、ジェフリイ・ジャフィ;
translated into Japanese by 大野薫
• コーポレートファイナンス; by リチャード・ブリーリー, スチュワート・マイヤーズ; translated into Japanese by 藤井
真理子、国枝繁樹
• 先物・オプション取引入門; by ジョン・ハル; translated into Japanese by 小林孝雄, オーパスワン

PC or AV used in
Class,etc. 　

(More Details)

Learning techniques to be incorporated 　

Suggestions on
Preparation and
Review Review of each lecture might be useful.

Requirements None

Grading Method The evaluation is determined by the results of the final exam. You are informed of the rules and format of the examination in advance. Also, if you do not take the exam, it will be a zero point in principle. However, there are some exceptions that should be taken into account, such as illness, and when the reason is recognized, it may be permitted to take the follow-up exam or adopt an alternative grade evaluation standard.

Practical Experience

Summary of Practical Experience and Class Contents based on it

Message Information on the lecture will be sent to each university account e-mail when necessary. Around April 8th (the first lecture will be on April 11th), an e-mail containing lecture information will be distributed to students who have already got enrolled in this course.

Other

Please fill in the class improvement questionnaire which is carried out on all classes.
Instructors will reflect on your feedback and utilize the information for improving their teaching.

Academic Year	2024Year	School/Graduate School	Graduate School of Humanities and Social Sciences (Master's Course) Division of Humanities and Social Sciences Economics Program
Lecture Code	WMEA1000	Subject Classification	Specialized Education
Subject Name	応用ファイナンス
Subject Name （Katakana）	オウヨウファイナンス
Subject Name in English	Applied Finance
Instructor	ONO SADAYUKI
Instructor (Katakana)	オノ　サダユキ
Campus	Higashi-Senda	Semester/Term	1st-Year, First Semester, First Semester
Days, Periods, and Classrooms	(1st) Thur13-14：Higashi-Senda Lecture Rm M302
Lesson Style	Lecture	Lesson Style (More Details)
Lecture
Credits	2.0	Class Hours/Week		Language of Instruction	J : Japanese
Course Level	5 : Graduate Basic
Course Area（Area）	24 : Social Sciences
Course Area（Discipline）	03 : Economics
Eligible Students
Keywords
Special Subject for Teacher Education		Special Subject
Class Status within Educational Program (Applicable only to targeted subjects for undergraduate students)
Criterion referenced Evaluation (Applicable only to targeted subjects for undergraduate students)
Class Objectives /Class Outline	Applied Finance plans to teach (1) fair value for bond, exchange rate, and financial derivatives, (2)relationship between risk and return on financial assets and Capital Asset Pricing Model (CAPM). In class, basic ideas and theory regarding these topics are introduced and analyzed. Additionally, news about financial markets that are shown on economic magazines such as Nikkei (Japanese daily newspaper) might be presented and discussed.
Class Schedule	Lecture Topic (1) Risk and Return: Explains how risk and return are measured and investors' attitudes toward risk. (2) Capital Asset Valuation Model 1: Describes important assumptions and conclusions of the capital asset pricing model. (3) Capital asset pricing model 2: Explains in detail investment trusts (funds). (4) Capital Asset Valuation Model 3: Considers the relationship between risk and return using the capital asset pricing model and finds an appropriate measure of risk. (5) The Efficient Market Hypothesis: Examines the relationship between asset prices and information held by investors. (6) Exchange Rate 1: Examines the direct and indirect effects of exchange rates on the returns on foreign assets. (7) Exchange Rate 2: Introduces three main theories that explain exchange rate movements. (8) Futures and Forward Trading: Explains the overview of financial derivatives and futures and forward trading. (9) Option 1: Describes the important aspects of an option on a derivative. (10) Option 2: Derives the option price relationship from the condition that arbitrage is not possible. (11) The Black-Scholes-Merton option pricing equation: Introduces the key theoretical formulas for option prices and observes the assumptions, conclusions, and problems. (12) Exchange rate swap and interest rate swap: Introduces two main types of swaps for derivative financial instruments. (13) Bond: Describes important issues for one of the major financial assets, bond. (14) Credit default swaps (CDS): Discusses the fundamentals and fair value of CDS. (15) Final exam
Text/Reference Books,etc.	As reference, • Modern Portfolio Theory and Investment Analysis; by Edwin J. Elton, Martin J. Gruber, Stephen J. Brown, William N. Goetzmann • コーポレートファイナンスの原理; by ステファン・ロス, ランドルフ・ウェスターフィールド、ジェフリイ・ジャフィ; translated into Japanese by 大野薫 • コーポレートファイナンス; by リチャード・ブリーリー, スチュワート・マイヤーズ; translated into Japanese by 藤井真理子、国枝繁樹 • 先物・オプション取引入門; by ジョン・ハル; translated into Japanese by 小林孝雄, オーパスワン
PC or AV used in Class,etc.
(More Details)
Learning techniques to be incorporated
Suggestions on Preparation and Review	Review of each lecture might be useful.
Requirements	None
Grading Method	The evaluation is determined by the results of the final exam. You are informed of the rules and format of the examination in advance. Also, if you do not take the exam, it will be a zero point in principle. However, there are some exceptions that should be taken into account, such as illness, and when the reason is recognized, it may be permitted to take the follow-up exam or adopt an alternative grade evaluation standard.
Practical Experience
Summary of Practical Experience and Class Contents based on it
Message	Information on the lecture will be sent to each university account e-mail when necessary. Around April 8th (the first lecture will be on April 11th), an e-mail containing lecture information will be distributed to students who have already got enrolled in this course.
Other
Please fill in the class improvement questionnaire which is carried out on all classes. Instructors will reflect on your feedback and utilize the information for improving their teaching.

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