International Finance 3 s.h.
The internationalization of financial markets has continued to accelerate over the last few years. At the same time, the growth of multinational enterprise has increased the importance of these markets. As a consequence of this, it has become essential for any business students with a specialization in finance to have a solid understanding of the working of these markets. This course is designed to introduce students to the practical structure of the global business and investment community. In particular, the concepts of currency risk management, global portfolio management, and multinational business finance are stressed. Topics include global currency and securities markets; role of foreign currency in global economy; size and structure of currency markets; foreign currency trading; spot and forward transactions; foreign exchange risk and parity relationships; link between interest rates; inflation and foreign currencies; purchasing power parity; interest rate parity; international Fisher relationship; exchange rate forecasting managing foreign exchange risk; relationship between currencies; hedging transactions; foreign currency options; foreign currency futures; international business risks; economic and political risks; transaction exposure; operating exposure; accounting exposure; portfolio management; global debt and equity; financing effects of global securities markets on financing decisions; swap contracting; portfolio management and asset allocation; international CAPM; efficiency of global markets; allocation of foreign securities in domestic portfolios; international capital budgeting privatization and joint venture format and teaching methods.