Table A - Finance

The information below details the unit of study descriptions for the units listed in the Table of postgraduate units of study: Commerce.

Unit outlines will be available through Find a unit outline two weeks before the first day of teaching for 1000-level and 5000-level units, or one week before the first day of teaching for all other units.
 

Finance

Achievement of a specialisation in Finance requires 30 credit points from this table comprising:
(i) 6 credit points of Table A - Foundational units of study*
(ii) 6 credit points of Table A - Finance core units of study; and
(iii) 18 credit points of Table A - Finance selective units of study.
Students completing this specialisation to meet the requirements for the Master of Commerce or as their compulsory specialisation for the Master of Commerce (Extension) must complete a 6 credit point capstone unit related to the specialisation from Table A - Capstone units of study section in Table A for the Graduate Certificate, Graduate Diploma and Master of Commerce OR Table A for the Master of Commerce (Extension).
Students completing this specialisation as an optional second specialisation for the Master of Commerce (Extension) do not need to complete a capstone unit.

Units of study

The units of study are listed below.

Table A - Foundational units of study*

* Note. Foundational units count to both the Foundational units of study for the course and the specialisation
FINC5001 Foundation in Finance

Credit points: 6 Session: Intensive February,Intensive July,Semester 1,Semester 2 Classes: Refer to the unit of study outline https://www.sydney.edu.au/units Assessment: Refer to the unit of study outline https://www.sydney.edu.au/units
Note: Refer to the unit of study outline https://www.sydney.edu.au/units
This unit introduces foundational concepts in capital markets and corporate finance, equipping students for further studies in the discipline. The firm and the role of financial institutions are explored before developing important skills in financial mathematics. The unit then moves to the valuation of tradable securities and their pricing in the capital markets. The decisions firms make around capital structure and payout policy are studied. The unit concludes with an exploration of information and market efficiency. The tools of finance allow decision makers to navigate risk and uncertainty.

Table A - Finance

Core units of study
FINC6001 Finance: Theory to Applications

Credit points: 6 Session: Semester 1,Semester 2 Classes: Refer to the unit of study outline https://www.sydney.edu.au/units Prerequisites: FINC5001 Assessment: Refer to the unit of study outline https://www.sydney.edu.au/units
Note: Students are strongly recommended to complete this unit before the Capstone subject for this specialisation.
This unit extends some of the fundamental concepts introduced in FINC5001 Foundations in Finance, and develops a rigorous framework for the analysis and understanding of key aspects of corporate financial decision making. Fundamental concepts in corporate finance are extended to more complex settings. The unit examines more advanced approaches to asset pricing and capital budgeting. New topics are covered in relation to derivative securities and real options applications in capital budgeting. The issues of the cost of capital, corporate capital structure, and corporate dividend policy, are extended to cover the interaction of corporate and personal taxation, agency problems, and information signalling.
Selective units of study
FINC5090 Finance in the Global Economy

Credit points: 6 Session: Semester 1,Semester 2 Classes: Refer to the unit of study outline https://www.sydney.edu.au/units Corequisites: FINC5001 Assessment: Refer to the unit of study outline https://www.sydney.edu.au/units
Modern financial markets are at the heart of the global economy. Thus, an understanding of finance requires a global perspective. This unit of study focuses on three core ideas. First, it provides a description of the role of financial markets within the global economy using modern methods. Next, it focuses on the tools which are needed to understand finance from a global perspective. Finally, it focuses on the behaviour of market participants and how they interact in a global setting. On completion of this unit students have an understanding of financial markets and their participants and how they interact in an integrated world.
FINC6000 Finance: Theory to Applications

Credit points: 6 Session: Semester 1 Classes: Refer to the unit of study outline https://www.sydney.edu.au/units Prerequisites: FINC5001 Prohibitions: FINC5002 Assumed knowledge: This unit requires students to have some background in calculus, matrices, statistics and probability. Assessment: Refer to the unit of study outline https://www.sydney.edu.au/units
Note: Refer to the unit of study outline https://www.sydney.edu.au/units
This unit provides students with an introduction to quantitative models and techniques in finance. Topics covered include basic stochastic calculus, probability measures and the role of numeraires, Black-Scholes and Hull-White models, and the theoretical and numerical techniques for valuing derivatives. There is a focus on both the intuitive and mathematical understanding of these topics, as well as their application to problems in quantitative finance.
FINC6005 Advanced Asset Pricing

Credit points: 6 Session: Semester 1 Classes: Refer to the unit of study outline https://www.sydney.edu.au/units Prerequisites: FINC5001 or FINC6000 Assessment: Refer to the unit of study outline https://www.sydney.edu.au/units
Note: Refer to the unit of study outline https://www.sydney.edu.au/units
This unit covers the fundamentals of asset pricing and valuation, under equilibrium conditions and under no-arbitrage restrictions. It reviews the main themes in modern asset pricing, and introduce ideas of importance to the evolution of the discipline, and consequently of relevance to a practitioner's long term perspective. The unit emphasises quantitative methods, so students are required to have fairly strong mathematical skills. Nevertheless, the mathematical tools needed in the unit are adequately reviewed.
FINC6009 Portfolio Theory and its Applications

Credit points: 6 Session: Semester 2 Classes: Refer to the unit of study outline https://www.sydney.edu.au/units Prerequisites: FINC5001 or FINC6000 Assessment: Refer to the unit of study outline https://www.sydney.edu.au/units
Note: Refer to the unit of study outline https://www.sydney.edu.au/units
This unit covers several aspects of modern/post-modern portfolio theory. An introduction to mathematical optimisation techniques in the presence of uncertainty is covered and results from modern portfolio theory to the Capital Asset Pricing Model derived. The unit also examines other popular models such as the Arbitrage Pricing Theory and Black-Litterman Model and concludes with some topical examples from industry. There is a degree of mathematical sophistication associated with this unit and consequently, students should be comfortable with a mathematical approach. However, the required mathematical tools are covered in the unit.
FINC6010 Derivative Securities

Credit points: 6 Session: Semester 2 Classes: Refer to the unit of study outline https://www.sydney.edu.au/units Prerequisites: FINC5001 Assessment: Refer to the unit of study outline https://www.sydney.edu.au/units
Note: Refer to the unit of study outline https://www.sydney.edu.au/units
This unit provides an introduction to derivative securities like options, futures and swaps. These securities are derived from fundamental securities such as equities and bonds. The unit examines the nature of each type of derivative security before a thorough treatment of the pricing and use of these securities for investment management and risk management purposes.
FINC6013 International Business Finance

Credit points: 6 Session: Semester 1 Classes: Refer to the unit of study outline https://www.sydney.edu.au/units Prerequisites: FINC5001 Assessment: Refer to the unit of study outline https://www.sydney.edu.au/units
Note: Refer to the unit of study outline https://www.sydney.edu.au/units
In our highly globalised and integrated world economy, understanding international dimensions of financial management is essential for businesses. This unit provides a greater understanding of the fundamental concepts and the tools necessary for effective financial decision making by business enterprises, within a global setting.
FINC6014 Fixed Income Securities

Credit points: 6 Session: Semester 2 Classes: Refer to the unit of study outline https://www.sydney.edu.au/units Prerequisites: FINC5001 Assessment: Refer to the unit of study outline https://www.sydney.edu.au/units
Note: Refer to the unit of study outline https://www.sydney.edu.au/units
This unit covers the concepts required for investment in fixed income securities, managing bond portfolios and understanding debt markets. Topics covered include duration, convexity, interest rate risk, bond volatility and the term structure of interest rates. The more complex types of debt securities studied include mortgage backed securities, corporate bonds with embedded options such as convertible bonds and interest rate derivatives.
FINC6015 Trading in Modern Financial Markets

Credit points: 6 Session: Semester 2 Classes: Refer to the unit of study outline https://www.sydney.edu.au/units Prerequisites: FINC5001 Assessment: Refer to the unit of study outline https://www.sydney.edu.au/units
Note: Refer to the unit of study outline https://www.sydney.edu.au/units
This unit introduces students to the core concepts of fundamental market design and structure, focussing on the processes that turn orders into trades in securities markets, and the forces that mould and effect order flow and execution. The unit provides insights into how the study of securities market microstructure can improve our understanding of today's global financial markets in order to: (a) facilitate better financing and investment decisions; (b) understand when, where and how to transact in financial instruments; and (c) make better use of the ever increasing flow of market information. An improved understanding of today's diverse financial markets allows for successful trading strategies to be developed in different instruments and across many markets, today and in the future.
FINC6017 Mergers and Acquisitions

Credit points: 6 Session: Semester 2 Classes: Refer to the unit of study outline https://www.sydney.edu.au/units Prerequisites: FINC5001 Prohibitions: ACCT6011 Assessment: Refer to the unit of study outline https://www.sydney.edu.au/units
Note: Refer to the unit of study outline https://www.sydney.edu.au/units
Mergers and acquisitions have become perhaps the most important activity of investment banks today. They provide a fundamental way for businesses to secure growth. To analyse mergers and acquisitions, most tools from modern financial economics are needed. The unit commences with a review of how existing businesses are valued, continues with an analysis of capital structure decisions, considers management incentives and examines issues in corporate control. It then examines the motives for mergers and acquisitions. Some acquisitions are motivated by value improvements created by correcting incentive problems, some acquisitions, however, are motivated by bad incentives that decrease value.
FINC6021 Corporate Valuation

Credit points: 6 Session: Semester 1 Classes: Refer to the unit of study outline https://www.sydney.edu.au/units Prerequisites: FINC5001 Assessment: Refer to the unit of study outline https://www.sydney.edu.au/units
Note: Refer to the unit of study outline https://www.sydney.edu.au/units
This unit applies all aspects of finance theory to the general problem of valuing companies and other financial assets. This requires a synthesis of the fundamental concepts of present value, cost of capital, security valuation, asset pricing models, optimal capital structures, derivative pricing and some related accounting concepts. The unit aims to reach a level of practical application that allows students to understand both the theoretical frameworks and institutional conventions of real-world corporate valuations. Basic valuation concepts from accounting are reconciled with the finance theory on which firm value ultimately stands. Students are asked to make extensive use of Excel or similar software in valuation exercises.
FINC6023 Financial Risk Management

Credit points: 6 Session: Semester 1 Classes: Refer to the unit of study outline https://www.sydney.edu.au/units Prerequisites: FINC5001 Assessment: Refer to the unit of study outline https://www.sydney.edu.au/units
Note: Department permission required for enrolment
Note: Refer to the unit of study outline https://www.sydney.edu.au/units
Risk is an integral part of financial decisions. Following the rapid evolution of the discipline of financial risk management, analysts must be prepared to access the level of risk in the marketplace. This unit explores the basic concepts of modelling, measuring and managing financial risks within the regulatory framework. Topics covered include market risk (value-at-risk and expected loss), credit risk (single name, portfolio, ratings and market based models, credit derivatives), liquidity risk and operational risk. To overcome the rather quantitative nature of the topics, the unit relies heavily on practical based lab exercises with emphasis on simulations, real life examples and case studies.
FINC6025 Entrepreneurial Finance

Credit points: 6 Session: Semester 1 Classes: Refer to the unit of study outline https://www.sydney.edu.au/units Prerequisites: FINC5001 Assessment: Refer to the unit of study outline https://www.sydney.edu.au/units
Note: Refer to the unit of study outline https://www.sydney.edu.au/units
This unit explores the considerations when planning the financial needs of new ventures and young companies. An overview of entrepreneurial finance reviews the concepts of valuation for entrepreneurial ventures and possible funding sources from the standpoint of the founder, management team and the funder. Fundamental valuation approaches considered in corporate finance are extended to model the opportunities and the capital structure relevant to a new venture. This unit examines the process of venture capital funding and the challenges of managing and funding growth. New topics are covered in relation to the growth and exit strategies employed by entrepreneurial ventures, as well as later stage financing, including mezzanine financing and buy-outs.