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 2025 is available in the Archives.

UTS: Business: Finance
Credit points: 6 cp

Subject level:

Undergraduate

Result type: Grade and marks

Requisite(s): 25300 Fundamentals of Business Finance OR 25400 Financial Literacy
These requisites may not apply to students in certain courses.
There are course requisites for this subject. See access conditions.

Description

This subject exposes students to the applied aspects of investment and portfolio management. Students analyse local and international asset classes and investment markets and the role that technology plays in these markets. The subject focuses on developing students’ technical capability to analyse and value equity, debt and alternative investments. Students will also develop the skills to construct, strategically manage and evaluate a portfolio of assets for individual and institutional investors.

Subject learning objectives (SLOs)

Upon successful completion of this subject students should be able to:

1.	describe the investment process, highlighting the role of asset classes, financial instruments and financial markets
2.	apply macroeconomic analysis, industry analysis and financial statements to the valuation of equity securities
3.	recommend whether to buy or sell shares in a company by interpreting the reports of financial analysts
4.	design an asset allocation scheme or a portfolio by applying a portfolio construction methodology
5.	assess the performance of a portfolio, with reference to its investment strategy and stated objectives

Contribution to the development of graduate attributes

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

Intellectual rigour and innovative problem solving
Professional and technical competence

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

Apply technical and professional skills to operate effectively in business (4.1)

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 learning management system site will be used extensively to share all materials and information.

The learning activities available to students are:

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).
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.
Tutorial problems: A set of theoretical and practical problems associated with each lecture will be posted online 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.
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.
UTS Learning Management System engagement: To stimulate collaborative learning, students are encouraged to use the 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)

Asset classes, financial instruments and financial markets
The characteristics of individual and institutional investors
New technology in investing, such as AI, machine learning, fintech and cryptocurrencies
Equity valuation using macroeconomic analysis, industry analysis and financial statement analysis
Understanding the role of equity analysts and interpreting their reports
The properties of bonds and debt securities
Alternative assets, such as private equity and hedge funds
ESG investing
Portfolio construction techniques
Investment strategies, investment objectives and performance measurement and attribution

Assessment

Assessment task 1: Quizzes (Individual)*

Objective(s):	This addresses subject learning objective(s): 2, 3 and 5
Weight:	30%
Length:	4 quizzes. 30 minutes each.
Criteria:	Questions will be marked based on: Ability to apply macroeconomic and industry analysis in valuation Ability to interpret financial reports for the purpose of conducting valuation Ability to assess portfolio performance

Assessment task 2: Group Assignment (Group)

Objective(s):	This addresses subject learning objective(s): 1 and 4
Weight:	20%
Length:	3-5 minutes per group presentation (indicative)
Criteria:	Presentations will be marked based on: Explanation of investment process and related financial elements Appropriateness of asset allocation design, including consideration of methodology

Assessment task 3: Final Examination (Individual)

Objective(s):	This addresses subject learning objective(s): 1, 2, 3 and 5
Weight:	50%
Length:	120 minutes
Criteria:	Questions will be marked based on: Understanding of the investment process and the role of financial instruments and financial markets Understanding of the implications of macroeconomic factors and industry forces for asset pricing and valuation Understanding of the multiple steps involved when conducting financial analysis and valuation Ability to conduct portfolio analysis and performance attribution

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.

Required texts

“Essentials of Investments” – International Student Edition by Bodie, Kane and Marcus, 12th Edition (2022) – McGraw Hill

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.