INTRODUCTION TO FINANCIAL ENGINEERING

AI434

Course Code: AI434
Semester: -
Theory+Practice: 3 + 0
ECTS: 5

Course Type

Elective Course

Course Level

Bachelor's Degree

Year of Study

Semester

ECTS

Name of Lecturer(s)

Learning Outcomes

At the end of this course, the students;

Understand credit risks faced by firms, both financial and non-financial.
Gain an ability to apply the basic principles of measurement, data analysis, and design of experiments.
Learn the techniques to identify and measure credit risks.
Learn how to use the risk management techniques in firm strategic plans.
Have ability to discuss current research trends and possible future development.

Mode of Delivery

Face to face

Prerequisites

Recommended Optional Programme Components

Course Description

Introduction to financial securities and markets and overview of the Turkish economy, fundamental concepts and techniques of financial engineering such as financial analysis, time value of money, capital budgeting, Risk Management in Financial Institutions and derivative securities and markets.

Course Contents

WEEK	TOPICS
1^st Week	Financial securities and markets, Fundamentals of Economics Overview of the Turkish economy
2^nd Week	Financial statements; Balance-Sheet, Income Statement and Cash Flow Statement
3^rd Week	Financial statements analysis
4^th Week	Financial Ratio Analysis: Liquidity ratios, Financial statement ratios and profitability ratios
5^th Week	Financial performance measurement application of the firms-real case studies
6^th Week	Time value of money, risk and rates of return
7^th Week	Capital budgeting techniques
8^th Week	Monte-Carlo simulation and Value-at-Risk (VaR) measures
9^th Week	Midterm
10^th Week	Risk Management in Financial Instituitons sources of risk and measuring market risk, credit risk, operational risks
11^th Week	Risk Management in Financial Instituitons- real case study
12^th Week	financing requirements of companies and corporate-commercial banking
13^th Week	Introduction to derivative securities and markets
14^th Week	Presentation of projects

Recommended or Required Reading

* Weston , J.F., Brigham, E.F., Essential of Manegerial Finance, Ninth Ed., Yhe Dryden Press, 1990
* Higgins, R.C., Analysis for financial Manegement, Fourth Ed., Irwin, 1995
* Luenberger, D.G., Investment Science, Oxford University Press, 1998
* Kent Baker, Gary Powell, Understanding Financial Management: A Practical Guide April 2005, Wiley-Blackwell

Planned Learning Activities and Teaching Methods

Lecture
Problem Solving
Questions/Answers
Report Preparation

Assessment Methods and Criteria

	Quantity	Percentage (%)
Mid-term	1	30
Assignment	2	10
Quiz	5	20
Attendance	1	5
Total(%)		65
Contribution of In-term Studies to Overall Grade(%)		65
Contribution of Final Examination to Overall Grade(%)		35
Total(%)		100

Language of Instruction

English

Work Placement(s)

Programme Qualifications / Learning Outcomes

	LO1	LO2	LO3	LO4	LO5
K1
K2
K3
K4
K5
K6
K7
K8
K9
K10
K11
K12