Introduction to Finance and Statistics

Description

This module provides an introduction to the fundamentals of finance and statistics.

Aims

The aim of this module is to provide students with an understanding of the introductory areas of finance and statistics.

Learning Outcomes

By the end of this module the student should be able to:

1.  Demonstrate an understanding of the fundamentals of descriptive statistics and its application using statistical software.

2.  Demonstrate an understanding of the concept of time value of money and its application to bonds and equities.

3.  Comprehend the fundamental aspects of the relationship between risk and return.

Indicative Content

1 Types of Data

In this part, we will look into different types of data: cross-sectional vs time series, qualitative vs quantitative.

2 Key concepts

In this part, we will introduce key statistics concepts, including descriptive vs inferential statistics, population-case-sample and variable.

3 Descriptive Statistics-Qualitative Variables (using SPSS)

In this lecture, we will look into summarising and visualising one qualitative variable and using cross-tabulation to analyse the relationship between two qualitative variables.

4 Descriptive Statistics-Quantitative Variables (using SPSS)

In this lectures, we will look into analysing one quantitative variable (using SPSS and manual calculations); analysing one quantitative variable between groups; and analysing the relationship between two quantitative variables using Scatter Diagram, Pearson’s Correlation Coefficient and Linear Regression.

5 Time Series Analysis (using Excel)

In these lectures, we will introduce the concepts of trend, seasonality and randomness. We will learn how to use time series plots to understand data movements over time. We will also learn how to calculate the linear trend and seasonal component of linear time series and use those to forecast future time series values.

6 Time Value of Money

In these lectures, we will study the time value of money (TVM). We will illustrate why money has a higher value today than in the future. We will also develop a set of tools that we will use throughout the rest of the module. We will start analysing single cash flows and then we will move onto annuity cash flows.

7 Bond Valuation

In these lectures, we will learn what bonds are, how to price them and why they are important to the firm.

8 Stock Valuation

In these lectures, we will learn what stocks are, how to price them and why they are important to the firm. In addition, we will look at the main stock markets in the world.

9 Risk and Return

In these lectures, we will introduce portfolio theory by learning how to characterise and estimate risk and return.

Statement on Teaching, Learning and Assessment

Teaching and Learning Work Loads

Total 200
Lecture 20
Tutorial/Seminar 5
Supervised Practical Activity 14
Unsupervised Practical Activity 0
Assessment 50
Independent 111



Guidance notes

Credit Value – The total value of SCQF credits for the module. 20 credits are the equivalent of 10 ECTS credits. A full-time student should normally register for 60 SCQF credits per semester.


Disclaimer

We make every effort to ensure that the information on our website is accurate but it is possible that some changes may occur prior to the academic year of entry. The modules listed in this catalogue are offered subject to availability during academic year 2019/10 , and may be subject to change for future years.