Professional Graduate Diploma in Investments and Finance
An advanced graduate level professional diploma in investments and finance, leading to MS, structured on CFA (USA) and FRM curriculum. The modules will be delivered by CFA charter holder, holding Ph.D from UK, with multiple years of academic and industry experience.
This module introduces the principal information sources used to evaluate a company’s financial performance. Primary financial statements (income statement, balance sheet, cash flow statement, and statement of changes in equity) in addition to notes to these statements and management reporting are examined. A general framework for conducting financial statement analysis is provided. The roles played by financial reporting standard-setting bodies and regulatory authorities, the Internal Accounting Standards Board’s conceptual framework, and the movement toward global accounting standards is explained. The module includes a discussion of financial analysis techniques including the use of ratios to evaluate corporate financial health by analyzing specific categories of assets and liabilities, i.e. Inventories, long-lived assets, income taxes, and non-current liabilities, as measures of profitability, liquidity, and solvency. The module also covers financial reporting analysis of investments in other companies, post-employment benefits, and foreign currency transactions. Analysis of chosen accounting treatment, corresponding effect on reported performance, and the potential for financial statement manipulation is part of the module with an emphasis on the conceptual framework of accounting in relation to concept of financial reporting quality.
The module provides an introduction to corporate governance, social considerations and investing/financing decisions. Capital budgeting and the assessment of capital investments are covered with practical techniques to estimate a company’s or project’s cost of capital.
This study session covers the capital budgeting process with emphasis on its principles and investment decision criteria. Project evaluation through the use of spreadsheet modeling is presented. The various types of leverage (operating, financial, total), measures of leverage, and how leverage affects a company’s earnings and financial ratios are examined. A discussion then follows on the different types of working capital and the management issues associated with each. Other income and valuation model approaches are compared. The subject of capital structure is introduced with the classic Modigliani– Miller irrelevance theory. Additional considerations of taxes, agency costs, financial distress and dividend policies are introduced.
Mergers, acquisitions, and corporate restructurings—which create changes in ownership and control—are examined.
The module provides a structural overview of financial markets and their operating characteristics. Overview markets include equities, fixed income, derivatives, and alternative investments. A discussion of market efficiency and the degree to which market prices may reflect available information concludes is presented. This study session introduces essential equity valuation concepts. The various definitions of value and the application of equity valuation techniques to solve everyday problems are first discussed (discounted cash flow valuation models, dividend discount model and residual income). A five-step equity valuation process is then described with the three main categories of equity valuation models (absolute, relative, total entity) presented in step three. Key return measures including the equity risk premium and derivation of the equity required return using various models (CAPM, multifactor, build up) conclude the session. The main approaches for valuing private company equity (income, market, asset based) are explained in the module. The module introduces the unique attributes that define fixed-income securities, then follows with an overview of global debt markets. Primary issuers, sectors, and bond types are explained. Key concepts for the calculation and interpretation of bond prices, yields, and spreads and coverage of interest rate risk and key related risk measures (credit risk, duration, convexity) are presented. Securitization—the creation of fixed-income securities backed by certain (typically less liquid) assets—including the various types, characteristics, and risks of these investments are discussed in detail. Traditional and modern theories and models explaining the shape of the yield curve are presented. An arbitrage-free framework using observed market prices is introduced for valuing option-free bonds. This approach also holds for more complex valuation of bonds with embedded options and other bond types. The binomial valuation method to value bonds with embedded options is explained. Option-adjusted spreads are introduced for the evaluation of risky bonds. From financial risk perspective, credit default swaps and their use in managing credit exposure is presented.
The module introduces the common probability distributions used to describe the behavior of random variables, such as asset prices and returns. How to estimate measures of a population (mean, standard deviation) based on a population sample is shown. A framework for hypothesis testing, used for validating dataset hypotheses, follows, along with techniques to accept or reject the assumed hypothesis. The module coverage of technical analysis, a set of tools that uses asset price, trading volume, and other similar data for making investment decisions. The module covers on how financial technology (fintech) is affecting areas within the investment industry, such as investment analysis, automated advice, and risk management. Correlation analysis, linear regression with one and multiple independent variables, and time-series analysis as tools for identifying relationships among variables are then introduced. The fundamental elements of all three are presented beginning with correlation analysis. Time-series analysis, in which the dependent variable’s past values are included as independent variables, follows. The module concludes with coverage of probability-based techniques for assessing risk, with a focus on simulation models.
The module introduces key valuation concepts and models for forward commitments (forwards, futures, swaps) and contingent claims (options). Option coverage includes the “Greeks,” which measure the effects on value of small changes in underlying asset value, time, volatility, and the risk-free rate. Coverage of common derivatives strategies and their investment objectives follows. Strategies for financial risk management and use of derivatives, including synthetic position exposure, covered calls and protective puts, bull and bear spreads, and collars and straddles are explained detail.
The module introduces the concept of a portfolio approach to investments by derivation of Capital Asset Pricing Model. The needs of individual and institutional investors are each examined, along with the range of available investment solutions. The three main steps in the portfolio management process (planning, execution, and feedback) are outlined. A discussion of risk management, including the various types and measures of risk, follows and a risk management framework is provided. Common portfolio risk and return measures and the introduction of modern portfolio theory—a quantitative framework for asset pricing and portfolio selection—come next. The module follows with coverage of the portfolio planning and construction process, including the development of an investment policy statement. Multifactor models including the arbitrage pricing theory (APT) and Carhart (4 factor) model are introduced as alternatives to the capital asset pricing model (CAPM). Considerations and applications of the three multifactor model types (macroeconomic, fundamental, statistical) are presented. A discussion on value at risk (VaR) and its use in measuring and managing market risk is presented in the module using three VaR approaches (parametric, historical simulation, Monte Carlo). The module continues with identifying and explaining the ties between the real economy and financial markets, including effects on asset values. The “fundamental pricing equation” is presented as a basic pricing framework for financial instruments. The asset prices of risk-free debt, risky debt, public equities, and real estate are shown to be affected via the business cycle’s impact on risk-free rates, the yield curve, inflation, and risk premiums. Analysis of active portfolio management follows, including a discussion of active risk and active return (Sharpe, information ratios). The fundamental law of active management is presented along with several investment applications. An overview of algorithmic and high-frequency trading is presented. The Module provides an overview of the more widely used alternative investments, including hedge funds, private equity, real estate, commodities, and infrastructure investment. Real estate investments, both private and public, are described, and methods for analysis and evaluation are presented. Private equity, including venture capital and leveraged buyouts, is examined from the perspectives of a private equity firm evaluating equity portfolio investments and an investor considering participation in a private equity fund. The module concludes with a discussion of commodities and commodity futures, including scenarios of contango and backwardation for futures prices.
|1st semester Fee
|Post Graduate Diploma
|Full time / Distance learning
|1 Year(2 Semester
|Fall & Spring
|Rs/-68,655/- (9 Cr.Hurs)
ENTRY TO PGD IN INVESTMENTS AND FINANCE
|16 years of education
|Almizan Campus Rawalpindi
|September & February