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25782 Alternative Investments

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 2018 is available in the Archives.

UTS: Business: Finance
Credit points: 6 cp

Subject level: Postgraduate

Result type: Grade and marks

Requisite(s): 25721 Investment Management
These requisites may not apply to students in certain courses. See access conditions.

Description

This course is designed to furnish students with a broad knowledge of the alternative investments industry. By using current material from the Chartered Alternative Investments Association (CAIA), students study material deemed relevant by the industry. The Journal of Alternative Investments (JoAI) is also used to ensure that students leave the course equipped with meaningful material. As preparation for employment, the course assessments are designed to improve critical thinking, report writing and quantitative abilities. Class discussion and involvement are encouraged.

Subject learning objectives (SLOs)

Upon successful completion of this subject students should be able to:
1. distinguish between alternative investments categories in the context of industry and regulation
2. evaluate the strategies and risks involved with a range of alternative investments including, real estate, commodities, private equity, equity hedge funds and global macro hedge funds
3. describe the due diligence process in hedge funds and hedge fund of funds
4. articulate lessons from the alternative investments industry via cases and the state of regulation globally

Contribution to the development of graduate attributes

Students will develop a rich understanding of alternative investments. They will present a real-life case study on a particular alternative investment and its suitability in an investor’s portfolio. Successful completion of this subject will contribute to students’ acquiring the following graduate attributes:

  • business knowledge and concepts
  • critical thinking, creativity and analytical skills
  • communication and interpersonal skills

The Subject Learning Objectives (SLOs) also align the UTS graduate attributes in the following ways:

  • SLO 1, 2, 3: disciplinary, professional and technical knowledge as students learn about each alternative investment and its purpose in an investor’s portfolio. Students will also learn about the role of hedge funds and the due diligence process of selecting hedge funds.
  • SLO 4: Disciplinary, professional and technical knowledge, spoken and written communication. Through in class presentation and written assignment students will present real-life cases of actual alternative investments and how regulation or the lack thereof plays a role in the function of the alternative investment.

Teaching and learning strategies

The subject will use a combination of in-class and online and offline learning activities. The in-class activities comprise a 3-hour interactive block that includes a lecture and collaborative learning activities including student led teaching through presentations and opportunities to discuss, collaborate and work together interactively via the Kahoot! interactive teaching tool. Industry guest speakers will be arranged for some classes providing students with the opportunity to see how theory is applied in practice. All these activities allow for students to have an engaging in-class experience.

In-class activities will be supplemented with both printed and electronic learning materials and resources. On-line and off-line learning opportunities provide students with access to a number of current videos and case studies on topics covered in the subject that they can view before coming to class. The UTS web-based communication tool (UTS Online) will be used to share information and encourage interaction between staff and students. Student will also use appropriate computer software such as word processors and presentation tools to complete assigned tasks.

Students are also expected to employ the following learning strategies:

  1. Pre-class activities include selected articles to read which will form part of student led presentations.
  2. Review of lectures - After each lecture students should go over the material covered and read material from the textbook that covers the topic in the lecture. Students should post questions on the UTS Online Discussion Board to discuss the material being covered. These questions will be answered by other students and the lecturers.
  3. Self-learning revision questions - A few days after a topic is covered in lectures students are required to complete the revision questions for the topic. While answers will be provided on UTS Online, students might want to post any questions they may have on topics on the discussion board on UTS Online.
  4. Self-learning on-line (non-assessable) multiple choice - Multiple choice quizzes are available on UTS Online for students to complete on the topics.

The self-learning revision questions and self-learning on-line (non-assessable) quizzes provide ongoing and early feedback for student class progress. Authentic practice quizzes similar in spirit to those used by the Chartered Alternative Investments Association (CAIA) accreditation exam and case studies examining aspects of in-class topics are also made available to supplement what is learned in class.

Content (topics)

• The Alternative Investments landscape.
• Risk and reward with fat tails and low liquidity
• Equity hedge funds
• Real estate
• Convertible bond arbitrage
• Commodities, managed futures and global macro hedge funds
• Private equity
• Fund of Hedge Funds
• Portfolio management and risk budgeting
• Hedge fund replication
• Lessons, due diligence and regulation

Assessment

Assessment task 1: Presentation and Written Assignment/Reflection (Group/Individual)

Intent:

This subject contributes specifically to the following program learning objectives for the courses C04038 Master of Financial Analysis and C04048 Master of Finance:

  • demonstrate effective oral presentation skills suitable for academic or professional audiences (PLO 3.2)
  • interact effectively with others in order to work towards a common outcome (PLO 3.3)
Objective(s):

This addresses subject learning objective(s):

1, 2 and 4

Weight: 20%
Length:

The presentation will be at most 10 minutes in length. More time will be given for using interactive class quiz tools like Kahoot (https://kahoot.it).

The assignment should be at most 20 pages in length in Times New Roman 12 point font, single spacing including pictures and appendices.

The written reflection should be at least half a page in length and at most two pages in length. So not too short or too long.

Criteria:
  • The presentation will be marked based oral presentation, visual presentation and audience engagement (equal weighting).
  • The assignment will be marked based on composition logic, factual accuracy and professional presentation (equal weighting).
  • The written reflection will be marked based on original thought and accuracy in answering question (equal weighting).

Assessment task 2: Class Quiz (Individual)

Objective(s):

This addresses subject learning objective(s):

1 and 2

Weight: 20%
Length:

See Task for details.

Criteria:

The assessment criterion for the quizzes is the accuracy of students’ answers.

Assessment task 3: Final Exam (Individual)

Objective(s):

This addresses subject learning objective(s):

1, 2, 3 and 4

Weight: 60%
Length:

See Task for details.

Criteria:

The marking criterion is the accuracy of answers.

Minimum requirements

Students must achieve at least 50% of the subject’s total marks.

Required texts

CAIA Level I: Core Topics in Alternative Investments (2015), 3rd edition ('CAIA I'). This book is available online from the UTS library website: http://find.lib.uts.edu.au/?R=OPAC_b3070672

Some e-readings are available at: http://find.lib.uts.edu.au/search.do?Ntt=25782&N=0

Recommended texts

CAIA Level II: Advanced Core Topics in Alternative Investments (2012), 2nd edition ('CAIA II') Relevant chapters are made available on UTS e-readings website.

Other resources

In accordance with the university and faculty rules, no further examination or assessment will be offered should you fail to attend a scheduled/special exam or submit an assessment. Your final mark/grade will remain unchanged if you failed to attend an examination or submit an assessment.