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25503 Investment Analysis

Warning: The information on this page is indicative. The subject outline for a particular session, location and mode of offering is the authoritative source of all information about the subject for that offering. Required texts, recommended texts and references in particular are likely to change. Students will be provided with a subject outline once they enrol in the subject.

Subject handbook information prior to 2019 is available in the Archives.

UTS: Business: Finance
Credit points: 6 cp

Subject level:


Result type: Grade and marks

Requisite(s): 25556 The Financial System AND ( 25622 Quantitative Business Analysis OR (35151 Introduction to Statistics AND 35102 Introduction to Analysis and Multivariable Calculus) OR (37131 Introduction to Linear Dynamical Systems AND 37132 Introduction to Mathematical Analysis and Modelling) OR (23565 Mathematics for Economics and Business AND 23571 Introductory Econometrics))
These requisites may not apply to students in certain courses.
There are course requisites for this subject. See access conditions.


This subject introduces the conceptual and theoretical framework of the portfolio approach to investments. It applies the techniques of mean-variance diversification to portfolio construction and the investment management process. Asset pricing models and their application to investment management are also reviewed. Other topics covered include bond portfolio management, active and passive investment strategies and the measurement of investment performance.

Subject learning objectives (SLOs)

Upon successful completion of this subject students should be able to:
1. discuss the role of risk and return in the investment management process;
2. appraise theories relating to asset pricing and portfolio choice;
3. evaluate risky asset classes and associated risk management techniques;
4. identify problems and issues in investment management

Contribution to the development of graduate attributes

The subject contributes to the aim of preparing students to commence a fulfilling and effective career in business, especially in investment management. It pursues this aim through the study of the theory and practice of portfolio construction on under uncertainty. Asset selection and risk management techniques are considered and applied in investment management. Principal asset classes are analysed in the context of their contribution to portfolio objectives, risk and return. Portfolio performance is monitored to illustrate the problems and issues in investment management.

This subject contributes to the development of the following graduate attributes:

  • Critical thinking, creativity and analytical skills
  • Business practice oriented skills

This subject also contributes specifically to develop the following Program Learning Objectives:

  • 2.2: Apply critical and creative thinking to address issues in business
  • 5.1: Apply technical and professional skills necessary to operate effectively in business and related professions

Teaching and learning strategies

Each week a two-hour lecture will present and analyse the relevant theories and concepts required to understand the world of modern investment management. Practical exercises and application of these concepts are then examined in detail in both on-line and off-line learning opportunities, and during interactive tutorial sessions. Alongside these activities, an in-depth, Excel-based, group assignment will also be undertaken outside of class time to allow for authentic collaborative learning which will bridge the gap between theory and practice. The UTSOnline site will be used extensively to share all materials and information.

The learning activities available to students are:

  1. Pre-lecture videos and articles: Students are required to watch and read a number of introductory online videos and articles before coming to each lecture. This will enable increased interaction during class and allow for active learning during lectures (such as small group discussions).
  2. Weekly lectures: These provide the main vehicle for the development of course content. Each week new material builds upon and develops earlier material and so it is important to consolidate understanding of one lecture before attending the next.
  3. Tutorial problems: A set of theoretical and practical problems associated with each lecture will be posted on UTSOnline each week. Students are encouraged to make a genuine attempt to solve these problems independently before seeking help from classmates or online. Abbreviated written solutions will accompany the tutorial problems to provide self-assessment and feedback, however these solutions are designed to be a check on students’ own work and not instructional. Instructional videocasts of tutorial solutions will also be provided online (with a lag of one week) which include much more detail and additional interactive exercises. The tutorial problems are an integral part of the subject and their importance cannot be underestimated.
  4. Weekly tutorial sessions: A formal one-hour tutorial session will take place each week and each student will be allocated to a specific tutorial session; note that sessions will only start during the second week of classes. These sessions are designed to allow students to obtain feedback on their attempted solutions to the tutorial problems, as such students are required to attempt the assigned problems prior to attending the session and to come prepared to discuss their attempted answers in class. There will also be two in-class quizzes during the tutorial sessions throughout the semester.
  5. UTSOnline engagement: To stimulate collaborative learning, students are encouraged to use the UTSOnline discussion board. The discussion board is a forum for students to post subject-related inquiries, discuss topics, and exchange ideas with classmates. The discussion board is a great tool for discussion between students and will also be monitored regularly by the lecturer(s) and tutors.

Content (topics)

  • Risk and return;
  • Portfolio theory, asset pricing theories and market efficiency;
  • Asset pricing models;
  • Active and passive strategies;
  • Performance measurement;
  • Fixed-income portfolio management.


Assessment task 1: Assignment (Group)


This addresses subject learning objective(s):

1, 2, 3 and 4

Weight: 30%

Assessment task 2: In-class quizzes (Individual)


This addresses subject learning objective(s):

1 and 2

Weight: 20%

45 minutes each.

Assessment task 3: Final Examination (Individual)


This addresses subject learning objective(s):

1, 2, 3 and 4

Weight: 50%

2 hours plus 10 minutes reading time.

Minimum requirements

To pass this subject you must achieve a combined grade of at least 50% for your assignment plus mid-semester and final exams.

Recommended texts

Edwin J. Elton, Martin J. Gruber, Stephen J. Brown, and William N. Goetzmann, Modern Portfolio Theory and Investment Analysis, 9th edition, Wiley, 2014.

An E-text version is available for $65 by going to the following link and scrolling to the bottom of the page:

Previous editions of the book (back to the 6th edition) would also suffice; however, any page references etc. may be incorrect.

Other useful texts:
David G. Luenberger, Investment Science, 2nd edition, Oxford University Press, 2013;
Zvi Bodie, Alex Kane and Alan Marcus, Investments, 10th edition, McGraw-Hill, 2013.

Other resources

Consultation Times
The lecturer(s) will be available for consultation at certain times throughout the week. These consultation times will be made available on UTSOnline.

The UTSOnline Discussion Board
The UTSOnline discussion board is a forum for students to post subject-related inquiries, discuss topics, and exchange ideas with classmates. If you are struggling with a tutorial problem, we recommend that you post a query on the discussion board. It is quite likely that one of your classmates will be able to assist you. Please note that the discussion board is a great tool for discussion between students and will be monitored regularly by the lecturer and tutors and you are encouraged to make good use of it.

Assistance with Mathematics and Statistics for students in the Faculty of Business
All UTS students are welcome to seek assistance with Mathematics and Statistics from the Mathematics Study Centre Drop-in Service, located in CB04.03.331. The room is staffed by tutors, lecturers, and some third year volunteers, and is open during semester Monday to Friday, usually 11am to 5pm. The timetable and list of tutors’ expertise is posted on the Maths Study Centre website during week 2 each session.