Foundations of Finance, FINC-UB.0002.008, Fall, 2020, Section 8

Prof. Joel Hasbrouck

email: jh4@stern.nyu.edu
web: http://people.stern.nyu.edu/jh4/

This page last updated: Sunday September 20, 2020 10:51 AM.

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Current notes, announcements, and handouts are posted to the NYU Classes page.

Format

This is a rotational section. This means that half our meetings will be in-person and half will be on Zoom. Attendance is required for all sessions. A session is either in-person or Zoom, but not both: an in-person class will not be Zoomed; a Zoom class won't have a physical meeting. The in-person and Zoom dates are not yet fixed.

Overview

This course is an introduction to the world's financial system: securities and institutions that create, trade, hold, manage and regulate them. In this course we mostly take the viewpoint of an investor, someone who is going into the financial markets to maximize gain and minimize risk. In the follow-on course (corporate finance), we take the perspective of financial manager, someone who is making firm-specific business decisions to maximize the value of the firm. By the end of this course, you should be able to comprehend most of the Markets pages of the Wall Street Journal.

Prerequisites

Finance, even at the introductory level, is a rigorously quantitative discipline that builds on prior knowledge. Prior to starting Foundations, you should have successfully completed a calculus-based microeconomics course and a statistics course (such as Statistics for Business Control & Regression/Forecasting Models). If you have not taken these classes (or if you are planning to take one or both concurrently) please email me and we can discuss things.

Grading policy

The departmental policy states: "To ensure fairness and clarity of grading, the Stern faculty has adopted a grading guideline for core courses with enrollment of more than 25 students, in which approximately 35% of students will receive an “A” or “A-” grade. In core courses of less than 25 students, the instructor is at liberty to give whatever grades he or she reasons the students deserve while maintaining rigorous academic standards." See the posted Finance Department grading policy.

Published Materials

• Required: Bodie, Kane and Marcus, Essentials of Investments (11th edition), abbreviated as "BKM"
  • Caution: Bodie, Kane and Marcus have another book with a similar title, called simply "Investments". Our book is "Essentials of Investments".
  • We are using the 11th edition. Earlier editions and international editions may appear substantially similar, but seemingly minor differences (like the numbering of end-of-chapter problems) may differ, possibly making these alternatives difficult to use.
  • In the bookstore, from the publisher (McGraw-Hill) and on websites (Amazon, Chegg, McGraw-Hill Connect, among others) you'll have a choice of print vs. eBook, purchase vs. rental, and so forth. This is all your choice. I usually prefer to read complex material in print, but it is tough to beat eBooks for convience. Study materials linked to the text are sometimes available on these sites (also for sale or rental). I have not evaluated these materials.
• Recommended: Solutions Manual (to Essentials of Investments, 11th edition)
• Other readings will be indicated on NYU Classes.

Financial calculator

You'll need a financial calculator to work problems and quizzes. Suitable calculators include the HP 10bII+ or the TI BA II Plus. Older versions of these calculators should also be okay: anything in HP 10B or TI BA series should suffice. I don't recommend top-of-the line financial calculators such as the HP 17 or similar: the extra power comes with extra complexity.

Deliverables (planned, but subject to change)

• Four untimed open-book problem sets. The tentative due dates for these are noted in the schedule at the end of this page. (10%-30% of final grade)
• Timed quizzes. Approximately 30-minutes, in class. (40%-60% of final grade)
• Final exam. Format to be determined (20%-30%)

Academic Integrity

Your academic conduct in this course is governed by the Stern Code of Conduct. Each of the deliverables will require you to sign or certify that, "I pledge my honor that I have not violated the NYU Stern Student Code of Conduct in the completion of this exam/problem set.”

Disability Disclosure Statement

Academic accommodations are available for students with disabilities. Please contact the Moses Center for Students with Disabilities (212-998-4980 or mosescsd@nyu.edu) for further information. Students who are requesting academic accommodations are advised to contact the Moses Center as early as possible in the semester for assistance.

Class notes and recordings

I generally make class notes available online prior to class. I usually make class videos available after class. (This is on a "best efforts" basis. Technical problems sometimes arise. I can't guarantee availability.)

Course content and assignment dates (tentative).
BKM=Bodie, Kane and Marcus, Essentials of Investments; Meetings will either be (KMEC) 1-100 or Rem (Remote)

*Tentative