- To make students acquainted with main tools of investment analysis, including (but not limited to): 1. How to analyze present and future cash flows? 2. How to calculate different investment indexes (for standard and non-standard investment projects)? 3. How to use different methods of evaluation and elimination of risks? 4. How to prepare corporate investment strategy? 5. How to use mathematical models to build up an optimal set of investment projects? 6. How to finance investment projects?
- Students have knowledge of basic theoretical aspects of investment analysis (understanding of the economic nature of investments, time value of money, risk, key players of the investment process).
- Students have ability to find, produce and analyze economic and financial information necessary for evaluation of investment projects (information about expected cash flows etc, including business planning).
- Students are able to find necessary information and analyze levels of risks of the project, possible guarantees etc
- Students have skills of taking decisions about selection of sources of finance depending on the nature of the project.
- Students have skills of taking investment decisions (positive and negative decisions about investments into a project, selection of portfolio of investments etc.)
- Topic 1. Introduction into theory of investment analysisWhy Do Individuals and Companies Invest? The nature of Investment Analysis. The Rate of Return On An Investment. Defining an Investment. Determinants of Required Rates of Returns. Holding Period Return. Holding Period Yield. Measures of Rates of Return. Expected Rates of Return. Adjusting for Inflation.
- Topic 2. Evaluation of investment projectsInvestment Indices. Discounted Payback Period. Net Present Value. Profitability Index. Internal Rate of Return.
- Topic 3. Uncertainty and risk: assessment and eliminationNon-conventional Projects. Differentiated Projects. Projects with Different Period of Activity. Substitution of Projects. Projects with Non-corresponding Periods.
- Topic 4. Sources of financeCharacteristics of Sources of Investments. Classification of Sources of Finance. Selection of Sources of Capital. Main Sources of Finance. Main Sources of Capital. Own resources. Bank Credit. Initial Public Offer. Bond Issuance. Leasing. Venture Finance and Investors. Project Finance.
- Topic 5. Investor strategyMulti-criteria Selection of Investments Projects. Effectiveness. Integral Effectiveness of a Project. Transformation of Real Values. Final Evaluation.
- Written examination
- In-class participation
- Written test
- Team project
- Individual assignment
- Interim assessment (4 module)0.05 * In-class participation + 0.15 * Individual assignment + 0.2 * Team project + 0.5 * Written examination + 0.1 * Written test
- Damodaran, A. (2012). Investment Valuation : Tools and Techniques for Determining the Value of Any Asset, University Edition (Vol. 3rd ed). Hoboken, N.J.: Wiley. Retrieved from http://search.ebscohost.com/login.aspx?direct=true&site=eds-live&db=edsebk&AN=442925
- Strategic Investment: Real Options and Games. (2004). Princeton University Press, Princeton NJ. Retrieved from http://search.ebscohost.com/login.aspx?direct=true&site=eds-live&db=edsnar&AN=edsnar.oai.repub.eur.nl.12234