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Risk Management and Financial Decision Making (VT IFS)

Risk Management and Financial Decision Making (VT IFS)

Module Coordinator/Lecturers
Study Programmes
Bachelor's degree programme in Business Administration
Project Description
Risk Management and Derivatives:
  • Financial risk management
  • Financial derivatives
  • Use of derivatives in financial risk management

Decision Theory:
  • Expected utility theory
  • Mean-variance theory
  • Prospect theory
  • Non-cooperative game theory
  • Asymmetric information
  • Market efficiency
  • Behavioral biases
Learning Outcomes The students...
Professional Competence
  • understand the most important concepts of financial risk
  • know why and where financial risks matter
  • understand the logic of the risk management process
  • know the standard types of financial derivatives and assumptions behind their valuation
  • describe pros and cons of different types of derivatives
  • know the most prominent decision theories
  • understand how rational solutions may be achieved by using classical decision models
  • understand the differences between decision under certainty, risk and ignorance
  • know different levels of market efficiency and their implications
  • understand how information is processed on financial markets
  • solve decision problems by using DT models and methods.
  • find the strategic aspect of a problem and transform it into a simplified problem.
  • can explain non-cooperative game theory
  • analyze decision situations.
  • evaluate Investments with EUT, MV and PT, explain and interpret the assumptions of these methods.
Methodological Competence
  • select and apply methods for identifying risks
  • select and apply methods for measuring risks
  • select and apply methods for managing risks
  • devise suitable hedging strategies using derivatives
  • select methods for risk communication
  • know methods in decision theory
  • know key concepts of experimental research approaches to test market and trader behavior
  • use methods and models on unknown decision situations.
  • calculate optimal solutions and equilibria
  • compare different methods for measuring and controlling risk and uncertainty in decision processes
  • evaluate decision methods in mini cases and find appropriate models for solving typical problems
  • are able to identify Nash Equilibria in simple Prisoner's Dilemma settings
Social Competence
  • pitch solutions to fellow students
  • argue in favor of and against candidate solutions
  • defend their stance in discussions
  • understand and critically discuss the arguments of fellow students.
Personal Competence
  • repeat the contents of lectures and exercises in a self-organized way
  • assess their own learning progress during lectures
  • identify their own strengths and weaknesses
  • tolerate different opinions and working styles
  • listen carefully, read and repeat, practice until they understand the logic and mathematics behind models
  • work together and motivate other students who tend to give up as a reaction to the difficulty of mathematical problems
Technology Competence
  • use standard software for valuing financial derivatives
Requirements (formal)
Inskription ab WS23/24
Diese Zugangsvoraussetzungen:
  • Für die Anmeldung zu Modulen der Vertiefungsrichtung müssen die Module Statistik, Wirtschaftsmathematik und English I erfolgreich absolviert sein.
  • Zusätzlich muss für die Anmeldung zur Vertiefung IFS das Modul Finanzierung erfolgreich absolviert sein.

Inskription vor WS23/24
Entweder obige Zugangsvoraussetzungen oder:
  • Für die Anmeldung zu Modulen des fünften Semesters müssen alle Module des ersten Studienjahres erfolgreich absolviert sein.
  • Wahlfächer bleiben für diese Regelungen vollständig ausser Betracht.
Module number:
5810806
Semester:
WS 24/25
ECTS Credits:
6
Courses:
56 L / 42 h
Self-study:
138 h
Language:
English
Scheduled Semester:
5