ORBS7220 Risk and Portfolio Management (3 units)
This course introduces the fundamental concepts of financial derivatives and portfolio risk measurement and management. Students will learn why both firms and individual investors should learn how to measure and manage risk. The first part of the course overviews on some common financial derivative instruments and their natures, how they can be used for investment and hedging purposes, and how they can be priced. The second part of the course gives the students an insight into how a business can identify the risk components, measure its loss exposures and select appropriate tools for the management risks. We shall detail the types of risks that firms are exposed to, and the costs and benefits associated with risk management. We examine the popular Value-at-Risk (VAR) and Expected Shortfall (ES) framework to help us estimate the risk exposure of firms. The third part of the course discusses about the portfolio measurement, management and portfolio performance evaluation. To highlight the practical relevance of the course materials we shall discuss a number of real-word case studies throughout the course.
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