Syllabus for FNAN303 of GMUK. Target students

Transcription

1 Syllabus for FNAN303 of GMUK Target students All GMUK students who are interested in the global financial business and want to build and share the knowledge/experience on the global financial system, 2008 financial turmoil and basic financial knowledge build-up for all financial matters including derivatives, various financial investments and M&A. This course purpose; This course is intended to study/understand the fundamental financial knowledge and roles of many financial intermediaries (including investment banks, commercial banks, specified securities houses, asset management companies, credit card companies, insurance companies, pension funds, private equity funds, hedge funds and etc.). As an undergraduate student, to understand a big picture on the development of global financial industry is very important no matter what he/she might want to do for life in their future. Also it will be an important learning process for an undergraduate student to learn the financial developments together with business strategies in conjunction with the changes on the relevant industries including mobile, internet, high tech and general manufacturing and marketing fields.. Prerequisite; none but, some accounting and corporate finance knowledge is preferred. Grade decision; Class participation is very important as many subjects to be covered at the class shall be related to real world knowledge which may not be shown at most of the text books class participation 20% mid-term exam 30% final exam 40% project 10%

2 Text book; none. But for those who wants to have some references, the book would be Essentials of Investments, any edition, by ZVI Bodie, Alex Kane and Alan Marcus and published by McGraw Hill. Lecturer background; Jongwon Nam served as Senior Country Representative and Branch Manager ( ) of Merrill Lynch`s Korea Office and was a Managing Director in the Investment Banking Division. He oversaw various management issues, while serving as a team leader of Investment Banking activities in Korea. Mr. Nam was also Chief Representative at Goldman Sachs, Hong Kong office ( ) for Korean business and worked at JP Morgan in New York ( ), Seoul ( ) and Hong Kong ( ) as Chief Representative managing Korean business. Mr. Nam has over 21 years of broad investment banking experience in New York, Hong Kong and Seoul. He was involved in a number of cross-border M&A advisory assignments for Korean and international clients. Mr. Nam was chief planning officer and chief commentator ( ) at MBN TV of Maeil Business Newspaper Group. He was Chief Editor at Maekyung Economy (weekly magazine) with 100,000 subscriptions and a Deputy Chief Editor ( ) at Maeil Business Newspaper with 1.05 million daily subscriptions in charge of Securities Division and Knowledge Division simultaneously. Mr.Nam has been Visiting Professor for Yonsei University at the Graduate School for International Studies and Underwood International College of Yonsei University since He has been an Adjunct Professor at the Finance Dept. of Hanyang University since 2017 as well. Mr. Nam graduated from Seoul National University and received an MBA from Northwestern University`s Kellogg Business School. Course schedule; 1 week : Introduction and basic requirements including financial statements and models 2 week : Discounted cash flow and net present value 3 week : Capital investment decision and Risk analysis 4 week : Interest rate and bond analysis 5 week : stock valuation and understanding of valuation method

3 6 week : Return and risk analysis and CAPM 7 week : Cost of capital and WACC 8 week : Efficient capital market and global financial disasters 9 week : Optimal capital structure and LT financing 10 week : Securities issuance and other alternatives, including options 11 week :What is M&A? - Fundamentals of Merger and Divestitures 12 week M&A Synergy calculation and its validation 13 week Recent Asian M&A Case Study: Really worked or not? 14 week Hedge Funds Why does the market need such instruments? 15 week Private Equity Investments and various Fund investment alternatives 16 week Demise of Global Investment Banking Firms and emerging new global financial structure General sample quiz contents 1. What are 3 major financial statements and their roles? 2. Explain on the cross currency swap using US Dollar and Japanese Yen example. 3. Describe on correlation, covariance, variance and standard deviation. 4. What is IRR (Internal Rate of Return) and assumption for such calculation? 5. Describe on Depreciation and Depletion. 6. Describe on Duration of a bond utilizing an example. 7. What are arbitrage and Hedge? 8. What is Interpolation and when do you do it? 9. If you find an annual reports on Company X with a Qualified Opinion, what would be your understanding for the report? 10. What do Leverage and coverage mean for financing matters? 11. Describe on SWOT analysis. 12. What is the difference between Short and Long for financial matters? 13. Describe on Call option & Put option and also on American Option & European Option. 14. Describe on Convertible Bond (CB) and bond with warrant (BW) and their impact on the balance sheet when the equity option should be exercised? 15. What kind of calculation method you should use for an amortization mortgage loan from a bank and its function formula? 16. What you might want to do when you have decided to open your own Chinese

4 restaurant or a coffee shop in a location that you have in mind? ( points) 17. If you want to buy a condominium in New York, what would you have to do in order not to pay over the inherent value as a prudent buyer? ( points) 18. Explain on Discount Cash-flow method for a company valuation by incorporating capital asset pricing model (CAPM) and WACC. ( points) 19. Explain on market or trading multiple assuming your young brother wants to invest in an unlisted company of a certain software industry? ( points) 20. Explain on Synergy for an M&A case and how do you calculate the level of synergy? ( points) 21. Explain on the diversification of portfolio using a hypothetical portfolio position against efficient market frontier. ( points) 22. What is the basic approach of new venture companies for their start-up? 23. What you might want to do when you have decided to open your own Chinese restaurant in a location that you have in mind? (5 points) 24. If you want to buy a condominium in New York, what would you have to do in order not to pay over the inherent value as a prudent buyer? (5 points) 25. Assume there are only 3 companies, A, B and C in the same industry that you are currently working. When Company A wants to merge/acquire Company B on a friendly basis, what kind of possible activities do you think those 3 companies might do in anticipation to such an official M&A announcement? (10 points) 26. Explain on Discount Cash-flow method for corporate valuation and discuss possible different discount rates (minimum 3 different rates) by incorporating capital asset pricing model (CAPM). (15 points) 27. Explain on market/trading multiple method assuming you want to invest in an unlisted software company versus other companies in the same industry? (10 points) 28. Explain on Synergy for an M&A case and what are the key components of synergy? (10 points) 29. Explain on the portfolio position shift at a graph of expected return (y axle)/risk (x axle) graph using a hypothetical portfolio and correlations when the portfolio manager plans to add new investments or subtract some from the existing portfolio holdings. (5 points) 30. Financial ratios are often used for quick look at the valuation. When do you use Debt to Equity ratio and EBIT/EBITDA coverage ratio? (5 points)

5 31. Explain on Modigliani and Miller proposition. (5 points) 32. Explain on M&A multiple and when do you use it? (5 points) 33. Explain on WACC (Weighted average cost of capital). (5 points) 34. Explain on Green Shoe in a financial transaction and why do you think an issuing company provide such a privilege to the underwriting company. (5 points). 35. Explain on Due Diligence of a financial transaction and who conduct such process? (5 points) 36. What are the events for inefficient market happenings when you have to explain why capital market is efficient? (10points) 37. Explain on ARPU for the industry which is relying on subscription. (5 points) 38. Explain how a tender offer is executed for an M&A transaction. (10 points)