International finance
Mr Adam Steen
One 3-hour session per week
* Second semester
* Clayton
*
Prerequisite: AAF9020 or equivalent
Objectives On completion of this subject students should be familiar with the major issues in foreign currency transactions and associated risks; able to understand and apply the central theorems of international finance theory; able to define and evaluate techniques used to hedge foreign currency exposures; familiar with international equity raising; able to evaluate international portfolio construction; able to analyse issues in international capital budgeting.
Synopsis This subject surveys the major principles and practices of international finance. Topics include foreign exchange contracts and exchange rate quotation; linkages between the spot rate, the forward rate, interest rates and inflation rates; management of foreign exchange risk; international diversification of investments; foreign currency futures and options; international issues in capital budgeting; taxation and accounting aspects of international finance.
Assessment Written (2000 words): 20%
* Examination (3 hours): 80%
Prescribed texts
Shapiro A C Multinational financial management 4th edn, Allyn and Bacon, 1992
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