AFX1300

Money and capital markets

Mr Chris Viney

6 points · 3 hours per week · First, second semester (Caulfield, Peninsula) · Second semester (Distance) · Prerequisite: nil

Objectives On completion of this unit students should demonstrate an understanding of a financial system, its operation and component parts; yield curve analysis, the term structure of interest rates, and exchange rate interaction; sources and types of business finance, short, medium and long term, domestic and overseas, and associated pricing formulae; the structure and operation of Australian financial institutions and markets; the major types of risk and the derivative products available to manage financial risk; the structure, functions and role of prudential supervision in the financial markets.

Synopsis The purpose and function of financial markets; financial assets, money and money supply; financial intermediation; flow of funds; yield curves and term structure of interest rates; finance instruments and pricing; financial institutions; financial risk and derivative products; Australian capital markets; international capital markets; and financial prudential supervision.

Assessment Assignment (2000 words): 30% · Examination (3 hours): 70% · Students must pass the examination (35/70) and gain a minimum of 50 marks overall to pass this subject · A student's final mark will be the sum of the marks gained from the assessment components listed, except that where the student has not satisfied the exam hurdle requirement, then the final mark will be a mark corresponding to the exam result expressed as a percentage.

Prescribed texts

McGrath M and Viney C W Financial institutions, instruments and markets in Australia 2nd edn, McGraw-Hill, 1996

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