25773 Investments and Risk Management

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:

Postgraduate

Result type: Grade and marks

Requisite(s): 25742c Financial Management AND 25741c Capital Markets
The lower case 'c' after the subject code indicates that the subject is a corequisite. See definitions for details.
These requisites may not apply to students in certain courses.
There are course requisites for this subject. See access conditions.

Description

This subject provides students with an in-depth understanding of both the theoretical and practical aspects of modern portfolio management. The subject also provides an introduction to risk management and the types of strategies used to manage risk, including personal and general insurance, and compulsory insurance products. Students learn about the fundamental factors driving the value of financial assets, the asset management process, the role of diversification and alternative asset classes, the concept of market efficiency and its limits. The practical aspects of the subject involve implementing asset management solutions for hypothetical clients, including the analysis of risk and return, the construction of diversified portfolios, and the assessment of the client’s financial and insurance needs. The identification, understanding and application of a variety of risk management tools is also considered.

Subject learning objectives (SLOs)

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

1.	analyse the factors driving the value of financial assets
2.	evaluate the risk-return relationship for various asset classes
3.	construct, manage and evaluate a portfolio of financial assets

Contribution to the development of graduate attributes

This subject provides students with a hands-on understanding of the best practices in the investment management industry and of fundamental forces driving the value of financial assets. Students are encouraged to read industry publications to understand the decision process of the key players in the industry. As such this subject contributes particularly to the development of these graduate attributes:

Intellectual rigour and innovative problem solving
Communication and collaboration

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

Critically analyse and apply innovative and integrated solutions to address complex financial planning issues (1.1)
Communicate information clearly in an appropriate form for financial planning clients and other relevant stakeholders (2.1)

Teaching and learning strategies

This subject strives to provide students with a comprehensive understanding of the financial planning industry, the processes involved and the regulatory environment. The online material and activities will develop students’ technical knowledge about the financial planning process and environment. The topics will be analysed using case studies during the face to face lectures.

Students will actively discuss the case studies with the instructor and peers based on the knowledge from the online material.

Content (topics)

Role and regulation of financial markets
Time value of money
Security valuation
Efficient markets hypothesis and behavioural biases
Asset pricing models
Asset classes
Risk and return
Diversification and portfolio construction
Alternative investments
Investment strategies

Assessment

Assessment task 1: Online Quiz (Individual)*

Objective(s):	This addresses subject learning objective(s): 1 and 2
Type:	Quiz/test
Weight:	20%
Criteria:	Ability to identify and appraise financial management techniques Accuracy of financial modelling skills understanding of the participants and their respective role in the Australian financial system *Note: Late submission of the assessment task will not be marked and awarded a mark of zero.

Assessment task 2: Assignment (Individual)*

Objective(s):	This addresses subject learning objective(s): 3
Type:	Report
Weight:	40%
Criteria:	Ability to empirically analyse the risk-return parameters for various asset classes Evaluation of the investment management process to achieve a particular outcome Construction of an appropriate investment portfolio to achieve a strategic outcome Accuracy of the computational results Presentation of the results of the strategic investment portfolio to a client

Assessment task 3: Final Exam (Individual)*

Objective(s):	This addresses subject learning objective(s): 1, 2 and 3
Type:	Examination
Weight:	40%
Criteria:	Level of comprehension of the factors that drive asset values Ability to synthesise complex financial information in order to communicate to a client Application of a range of valuation methods Application of various models used to assess portfolio returns

Minimum requirements

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

Required texts

Mandatory reading and other learning material will be placed on Canvas.

References

Bodie, Z., Kane, A. and Marcus, A.J., 2024. Investments,13th Edition, McGraw-Hill.

Baker, H.K. and Ricciardi, V., 2014. Investor behavior: The psychology of financial planning and investing. John Wiley & Sons.