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Unit outline_

FINC3014: Trading and Dealing in Security Markets

Semester 2, 2022 [Normal day] - Remote

This unit is concerned with the processes which turn orders into trades in securities markets, and the forces which mould and affect both order flow and order execution. The unit provides an introduction to some fundamental ideas about market design and structure. At the end of the unit, students should be able to understand (1) how the international markets for foreign exchange, swaps, bonds and equities are organised, (2) how trading is conducted in these markets and how these transactions are cleared, (3) how the markets are regulated, if they are supervised and what risks different counterparties face in these markets. The unit aims to equip students to independently analyse international investment and financing alternatives and to estimate expected returns and costs taking into account liquidity risk, price volatility and credit risk.

Unit details and rules

Academic unit Finance
Credit points 6
Prerequisites
? 
FINC2012
Corequisites
? 
None
Prohibitions
? 
None
Assumed knowledge
? 

None

Available to study abroad and exchange students

Yes

Teaching staff

Coordinator Reuben Segara, reuben.segara@sydney.edu.au
Type Description Weight Due Length
Final exam (Record+) Type B final exam Final exam
Multiple-choice questions and extended responses
50% Formal exam period 2 hours
Outcomes assessed: LO1 LO2 LO3
In-semester test (Record+) Type B in-semester exam Mid-semester exam
Multiple-choice questions
25% Week 08
Due date: 20 Sep 2022 at 10:00
80 minutes
Outcomes assessed: LO1 LO2 LO3
Assignment group assignment Trading strategy report
Trading strategy report that is shaped by experiences learned from RIT
25% Week 11
Due date: 21 Oct 2022 at 17:00

Closing date: 04 Nov 2022
6 to 8 A4 pages
Outcomes assessed: LO1 LO2 LO3 LO4 LO5
group assignment = group assignment ?
Type B final exam = Type B final exam ?
Type B in-semester exam = Type B in-semester exam ?

Assessment summary

  • Mid-semester exam: The mid-term exam will consist of multiple-choice questions (MCQs). This exam will cover all topics covered up to the exam date (Weeks 1 to 6), including both lecture notes and tutorial content. Feedback will be provided on your MCQ results after the closing date.
  • Trading assignment: Students will be required to write a trading strategy report, which will be shaped by learning experiences from Rotman Interactive Trader (RIT).
  • Final exam: The final exam will consist of multiple-choice questions (MCQs) and extended responses covering the entirety of the unit. 

Detailed information for each assessment will be provided on Canvas.

Assessment criteria

The University awards common result grades, set out in the Coursework Policy 2014 (Schedule 1).

As a general guide, a high distinction indicates work of an exceptional standard, a distinction a very high standard, a credit a good standard, and a pass an acceptable standard.

Result name

Mark range

Description

High distinction

85 - 100

Awarded when you demonstrate the learning outcomes for the unit at an exceptional standard, as defined by grade descriptors or exemplars outlined by your faculty or school. 

Distinction

75 - 84

Awarded when you demonstrate the learning outcomes for the unit at a very high standard, as defined by grade descriptors or exemplars outlined by your faculty or school.

Credit

65 - 74

Awarded when you demonstrate the learning outcomes for the unit at a good standard, as defined by grade descriptors or exemplars outlined by your faculty or school.

Pass

50 - 64

Awarded when you demonstrate the learning outcomes for the unit at an acceptable standard, as defined by grade descriptors or exemplars outlined by your faculty or school. 

Fail

0 - 49

When you don’t meet the learning outcomes of the unit to a satisfactory standard.

For more information see guide to grades.

Late submission

In accordance with University policy, these penalties apply when written work is submitted after 11:59pm on the due date:

  • Deduction of 5% of the maximum mark for each calendar day after the due date.
  • After ten calendar days late, a mark of zero will be awarded.

Academic integrity

The Current Student website  provides information on academic integrity and the resources available to all students. The University expects students and staff to act ethically and honestly and will treat all allegations of academic integrity breaches seriously.  

We use similarity detection software to detect potential instances of plagiarism or other forms of academic integrity breach. If such matches indicate evidence of plagiarism or other forms of academic integrity breaches, your teacher is required to report your work for further investigation.

You may only use artificial intelligence and writing assistance tools in assessment tasks if you are permitted to by your unit coordinator, and if you do use them, you must also acknowledge this in your work, either in a footnote or an acknowledgement section.

Studiosity is permitted for postgraduate units unless otherwise indicated by the unit coordinator. The use of this service must be acknowledged in your submission.

Simple extensions

If you encounter a problem submitting your work on time, you may be able to apply for an extension of five calendar days through a simple extension.  The application process will be different depending on the type of assessment and extensions cannot be granted for some assessment types like exams.

Special consideration

If exceptional circumstances mean you can’t complete an assessment, you need consideration for a longer period of time, or if you have essential commitments which impact your performance in an assessment, you may be eligible for special consideration or special arrangements.

Special consideration applications will not be affected by a simple extension application.

Using AI responsibly

Co-created with students, AI in Education includes lots of helpful examples of how students use generative AI tools to support their learning. It explains how generative AI works, the different tools available and how to use them responsibly and productively.

WK Topic Learning activity Learning outcomes
Week 01 Trading basics Lecture (3 hr) LO1 LO2 LO3
Week 02 The trading industry Lecture and tutorial (3 hr) LO1 LO2 LO3
Week 03 Large traders and market impact costs [Tutorial: Real-time online trading simulator] Lecture and tutorial (3 hr) LO1 LO2 LO3 LO4 LO5
Week 04 Dealer markets Lecture and tutorial (3 hr) LO1 LO2 LO3
Week 05 How do investors behave? [Tutorial: Real-time online trading simulator] Lecture and tutorial (3 hr) LO1 LO2 LO3 LO4 LO5
Week 06 What do we want from markets? Lecture and tutorial (3 hr) LO1 LO2 LO3
Week 07 Evaluating markets and investments [Tutorial: Real-time online trading simulator] Lecture and tutorial (3 hr) LO1 LO2 LO3 LO4 LO5
Week 08 Mid-term exam (Tutorials will be held this week, where during those tutorials assignment queries will be addressed) Lecture and tutorial (3 hr) LO1 LO2 LO3
Week 09 Arbitrage Lecture and tutorial (3 hr) LO1 LO2 LO3
Week 10 What's been happening in markets? [Tutorial: Real-time online trading simulator] Lecture and tutorial (3 hr) LO1 LO2 LO3 LO4 LO5
Week 11 Distressed markets Lecture and tutorial (3 hr) LO1 LO2 LO3
Week 12 Market dislocations Lecture and tutorial (3 hr) LO1 LO2 LO3
Week 13 Review session (An overview of where markets are now) [Tutorial: Real-time online trading simulator] Lecture and tutorial (3 hr) LO1 LO2 LO3 LO4 LO5

Attendance and class requirements

Lecture recordings: All lectures and seminars are recorded and will be available on Canvas for student use. Please note the Business School does not own the system and cannot guarantee that the system will operate or that every class will be recorded. Students should ensure they attend and participate in all classes.

Study commitment

Typically, there is a minimum expectation of 1.5-2 hours of student effort per week per credit point for units of study offered over a full semester. For a 6 credit point unit, this equates to roughly 120-150 hours of student effort in total.

Required readings

All readings for this unit can be accessed through the Library eReserve, available on Canvas.

  • Financial Trading and Investing, by John L. Teall, Academic Press.

Learning outcomes are what students know, understand and are able to do on completion of a unit of study. They are aligned with the University's graduate qualities and are assessed as part of the curriculum.

At the completion of this unit, you should be able to:

  • LO1. identify the processes by which security prices come about, why trading occurs and how trading is conducted
  • LO2. discuss how financial decisions by corporations turn into trades that move prices in exchanges
  • LO3. connect the theory of corporations to the visible financial market news in the media
  • LO4. utilise your own trading strategies within practice and evaluate them with the aid of a real-time trading simulator
  • LO5. build algorithms to execute trades automatically.

Graduate qualities

The graduate qualities are the qualities and skills that all University of Sydney graduates must demonstrate on successful completion of an award course. As a future Sydney graduate, the set of qualities have been designed to equip you for the contemporary world.

GQ1 Depth of disciplinary expertise

Deep disciplinary expertise is the ability to integrate and rigorously apply knowledge, understanding and skills of a recognised discipline defined by scholarly activity, as well as familiarity with evolving practice of the discipline.

GQ2 Critical thinking and problem solving

Critical thinking and problem solving are the questioning of ideas, evidence and assumptions in order to propose and evaluate hypotheses or alternative arguments before formulating a conclusion or a solution to an identified problem.

GQ3 Oral and written communication

Effective communication, in both oral and written form, is the clear exchange of meaning in a manner that is appropriate to audience and context.

GQ4 Information and digital literacy

Information and digital literacy is the ability to locate, interpret, evaluate, manage, adapt, integrate, create and convey information using appropriate resources, tools and strategies.

GQ5 Inventiveness

Generating novel ideas and solutions.

GQ6 Cultural competence

Cultural Competence is the ability to actively, ethically, respectfully, and successfully engage across and between cultures. In the Australian context, this includes and celebrates Aboriginal and Torres Strait Islander cultures, knowledge systems, and a mature understanding of contemporary issues.

GQ7 Interdisciplinary effectiveness

Interdisciplinary effectiveness is the integration and synthesis of multiple viewpoints and practices, working effectively across disciplinary boundaries.

GQ8 Integrated professional, ethical, and personal identity

An integrated professional, ethical and personal identity is understanding the interaction between one’s personal and professional selves in an ethical context.

GQ9 Influence

Engaging others in a process, idea or vision.

Outcome map

Learning outcomes Graduate qualities
GQ1 GQ2 GQ3 GQ4 GQ5 GQ6 GQ7 GQ8 GQ9

This section outlines changes made to this unit following staff and student reviews.

Since this unit was last offered, student feedback is provided continuously, and we aim to respond to student queries within 1-2 business days.

Disclaimer

The University reserves the right to amend units of study or no longer offer certain units, including where there are low enrolment numbers.

To help you understand common terms that we use at the University, we offer an online glossary.