This course is designed to familiarise students with the components of the financial system as well as to introduce them to the three basic ideas underpinning finance, namely the time value of money, diversification and arbitrage. In doing so, the course provides students with introductory exposure to financial transactions, institutions and markets including money markets, stock markets, foreign exchange and derivative markets and the instruments traded therein. It also provides students with a solid foundation for later studies in finance.

Learning Outcomes

Upon successful completion, students will have the knowledge and skills to:

1. Explain basic financial transactions, institutions and markets, including money markets, stock markets, foreign exchange, derivatives markets and contracts.
2. Discuss the concept of time value of money and calculate the value of cash flows relating to a number of financial instruments.
3. Explain the concept of diversification, including the risk and return relationship and calculate optimal weights for a portfolio comprising of two financial assets.
4. Discuss concepts of arbitrage, and utilise derivatives for risk management purposes.

Research-Led Teaching

Students undertaking this course will be taught fundamental skills in Finance that will be applied to real life applications. Students will also be shown how these techniques are applied to research today.

Additional Course Costs

The only additional course costs are a non-programmable scientific calculator (not a financial calculator).

Examination Material or equipment

The mid-semester exam will be over the week 6/7 period with details to be advised no later than teaching week 4 of the semester. The final exam will be centrally timetabled by Examinations, Graduations & Prizes prior to the examination period and will be held in person on campus. Please check ANU Timetabling for further information.

You will require a scientific calculator for the mid-semester and final exams.

Required Resources

No required textbook.

Recommended Resources

Titman, S., Martin, T., Keown, A., and J. Martin, Financial Management: Principles and Applications, 8th Edition, Pearson Education, 2019.

Note that the textbook readings from this recommended resource are optional. In addition, this textbook is available to students as a 2 hour loan from the ANU library, and an e-book can be accessed from: https://library.anu.edu.au/record=b5640022.

Staff Feedback

Students will be given feedback in the following forms in this course:

• Interactions with lecturer and tutor(s) in consultations and live tutorials/workshops/lectures.
• Through assessments where the lecturer and tutors will provide specific feedback.

Student Feedback

ANU is committed to the demonstration of educational excellence and regularly seeks feedback from students. Students are encouraged to offer feedback directly to their Course Convener or through their College and Course representatives (if applicable). Feedback can also be provided to Course Conveners and teachers via the Student Experience of Learning & Teaching (SELT) feedback program. SELT surveys are confidential and also provide the Colleges and ANU Executive with opportunities to recognise excellent teaching, and opportunities for improvement.

Other Information

Scaling

You final mark for the course will be based on the raw marks allocated for each of your assessment items. However, your final mark may not be the same number as produced by that formulate, as marks may be scaled. Any scaling applied will preserve the rank order of raw marks (i.e. if your raw mark exceeds that of another student, then your scaled mark will exceed or be the same as the scaled mark of that student), and may result in a score that is either higher or lower than the raw mark calculated.

Support for Students

The University offers a number of support services for students. Information on these is available online from http://students.anu.edu.au/studentlife/

Communication

If necessary, the lecturer and tutor(s) for this course will contact students on their official ANU student email address. Information about your enrollment and fees from the Registrar and Student Services' office will also be sent to this email address. Students are expected to check the Wattle site for announcements about this course, e.g. changes to timetables or notifications of cancellations.

Assessment Requirements

As a further academic integrity control, students may be selected for a 15 minutes individual oral examination of their written assessment submissions.

Any student identified, either during the current semester or in retrospect, as having used ghost-writing services will be investigated under the University's Academic Misconduct Rule.

Class Schedule

Week/Session	Summary of Activities	Assessment
1	Topic: Course Admin and Introduction to Financial Mathematics.Activities: Lecture/WorkshopReading: Lecture Notes 1; CFA Code of Ethics, CFA Standards of Professional Conduct, Sections I and VII
2	Topic: Time Value of Money – Dividends and Valuing Shares.Activities: Lecture/Workshop/Tutorial (Tutorial 1 Questions)Reading: Lecture Notes 2
3	Topic: Time Value of Money – Valuing Debt InstrumentsActivities: Lecture/Workshop/Tutorial (Tutorial 2 Questions)Reading: Lecture Notes 3	Quiz 1
4	Topic: Time Value of Money – Making Investment DecisionsActivities: Lecture/Workshop/Tutorial (Tutorial 3 Questions)Reading: Lecture Notes 4
5	Topic: Diversification – Defining Risk, Understandings its Relationship with ReturnActivities: Lecture/Tutorial (Tutorial 4 Questions)Reading: Lecture Notes 5	Quiz 2
6	Topic: Diversification – Portfolio Theory Activities: Lecture/Tutorial (Tutorial 5 Questions)Reading: Lecture Notes 6	Mid-semester exam on campus will be held either in week 6 or week 7.
7	Topic: Diversification – The Capital Asset Pricing Model (CAPM), the Required rate of return for Risk and the Cost of CapitalActivities: Lecture/Workshop/Tutorial (Tutorial 6 Questions)Reading: Lecture Notes 7	Mid-semester exam on campus will be held either in week 6 or week 7.
8	Topic: Arbitrage - Futures Contracts Part (A) Activities: Lecture/Workshop/Tutorial. (Tutorial 7 Questions)Reading: Lecture Notes 8
9	Topic: Arbitrage – Futures Contracts Part (B) and Options Contracts Part (A)Activities: Lecture/Workshop/Tutorial (Tutorial 8 Questions)Reading: Lecture Notes 9	Quiz 3
10	Topic: Arbitrage – Options Contracts Part (B)Activities: Lecture/Workshop/Tutorial (Tutorial 9 Questions)Reading: Lecture Notes 10	Quiz 4
11	Topic: Arbitrage – Forwards, Futures and Options Contracts as tools for Risk ManagementActivities: Lecture/Workshop/Tutorial (Tutorial 10 Questions)Reading: Lecture Notes 11
12	Topic: Final Exam DetailsActivities: Lecture/Tutorial (Tutorial 11 Questions)Reading: Lecture Notes 12

Tutorial Registration

Tutorials commence in Week 2 of the semester. ANU utilises MyTimetable to enable students to view the timetable for their enrolled courses, browse, then self-allocate to small teaching activities / tutorials so they can better plan their time.

Tutorial registration will be available two weeks prior to the beginning of the semester and will close at the end of Week 1. More details can be found on the Timetable webpage (https://www.anu.edu.au/students/program-administration/timetabling).

Assessment Summary

Assessment task	Value	Due Date	Return of assessment	Learning Outcomes
Quizzes	15 %	08/03/2024	15/03/2024	1,2,3,4
Mid-Semester Examination	30 %	19/04/2024	03/05/2024	1,2,3,4
Final Examination	55 %	30/05/2024	27/06/2024	1,2,3,4

* If the Due Date and Return of Assessment date are blank, see the Assessment Tab for specific Assessment Task details

Policies

ANU has educational policies, procedures and guidelines , which are designed to ensure that staff and students are aware of the University’s academic standards, and implement them. Students are expected to have read the Academic Integrity Rule before the commencement of their course. Other key policies and guidelines include:

• Academic Integrity Policy and Procedure
• Student Assessment (Coursework) Policy and Procedure
• Special Assessment Consideration Guideline and General Information 
• Student Surveys and Evaluations
• Deferred Examinations
• Student Complaint Resolution Policy and Procedure
• Code of practice for teaching and learning

Assessment Requirements

The ANU is using Turnitin to enhance student citation and referencing techniques, and to assess assignment submissions as a component of the University's approach to managing Academic Integrity. For additional information regarding Turnitin please visit the Academic Skills website. In rare cases where online submission using Turnitin software is not technically possible; or where not using Turnitin software has been justified by the Course Convener and approved by the Associate Dean (Education) on the basis of the teaching model being employed; students shall submit assessment online via ‘Wattle’ outside of Turnitin, or failing that in hard copy, or through a combination of submission methods as approved by the Associate Dean (Education). The submission method is detailed below.

Moderation of Assessment

Marks that are allocated during Semester are to be considered provisional until formalised by the College examiners meeting at the end of each Semester. If appropriate, some moderation of marks might be applied prior to final results being released.

Participation

Course content delivery will take the form of weekly on-campus lectures, workshops and weekly tutorials. Lectures and Workshops will be recorded. Weekly consultations with the lecturer and the tutor(s) will be conducted either via Zoom or in-person (to be advised by end of first week).

Examination(s)

Centrally scheduled examinations through Examinations, Graduations & Prizes will be timetabled prior to the examination period. Please check ANU Timetabling for further information.

Assessment Task 1

Quizzes

• Students will be required to sit 4 in-tutorial quizzes throughout the semester.
• The quizzes will be 10 – 15 minutes in duration and held at the end of the tutorial.
• It is a closed book exam, with no formula sheet provided.
• Students MUST sit the quiz in the tutorial they are enrolled in, otherwise the quiz will not count.
• The content for the quizzes will be limited to the required material for the topic on which the tutorial is held (previous week’s lecture material).
• Students’ best 3 quiz marks will count towards 15% of their overall course grade.
• Students will receive their marked quizzes back in the tutorial the following week.
• This assessment task needs to be completed in pen (NOT PENCIL).
• Note: Students are required to prepare worked solutions to tutorial questions, bring these solutions to tutorials, and be prepared to participate in tutorial discussions. This is an important step in preparing for the tutorial quizzes.

Assessment Task 2

Mid-Semester Examination

• This exam is optional and redeemable for students.
• The duration of the exam is 90 minutes.
• It is a closed book exam, with no formula sheet provided.
• The questions will be a mixture of theory and practical questions.
• Students will need to review and revise all material covered in lectures 1 to 4, inclusive (i.e. the time value of money topics), as well as content in corresponding workshops and tutorials.
• The mid-semester exam will count towards either 0% or 30% of a student’s overall course grade.
• Students will be provided with further details regarding the exam by the end of Week 4.
• The exam will be held on campus, in person.
• This assessment task needs to be completed in pen (NOT PENCIL).

• Note: Mid-semester exams will be offered in weeks 6 or 7. Deferred exams for mid-semester exams will also be offered. Like final exams, applications for deferred mid-semester exams will be handled centrally. Deferred mid-semester exams are likely to be held in approximately week 10. Centrally administered examinations through Examinations, Graduations & Prizes will be timetabled prior to the examination period. Please check ANU Timetabling for further information. Exam scripts will not be returned. 

Assessment Task 3

Final Examination

• The final examination will be closed book and based on all the work covered throughout the duration of the semester.
• The final examination is worth 55% (or 85% if the mid-semester exam is redeemed) of the overall course grade.
• It is a closed book exam, with no formula sheet provided.
• The exam will include a mixture of theoretical and numerical questions.
• Students will be provided with further details regarding the exam by the end of week 10.
• This assessment task needs to be completed in pen (NOT PENCIL).
• The final exam is centrally scheduled through Examinations and will be timetabled prior to the examination period (please check ANU Timetabling for further information). Exam scripts will not be returned. The due date references the start of the exam period, with the final exam date still to be determined.
• The exam will be held on campus, in person.

Academic Integrity

Academic integrity is a core part of the ANU culture as a community of scholars. The University’s students are an integral part of that community. The academic integrity principle commits all students to engage in academic work in ways that are consistent with, and actively support, academic integrity, and to uphold this commitment by behaving honestly, responsibly and ethically, and with respect and fairness, in scholarly practice.

The University expects all staff and students to be familiar with the academic integrity principle, the Academic Integrity Rule 2021, the Policy: Student Academic Integrity and Procedure: Student Academic Integrity, and to uphold high standards of academic integrity to ensure the quality and value of our qualifications.

The Academic Integrity Rule 2021 is a legal document that the University uses to promote academic integrity, and manage breaches of the academic integrity principle. The Policy and Procedure support the Rule by outlining overarching principles, responsibilities and processes. The Academic Integrity Rule 2021 commences on 1 December 2021 and applies to courses commencing on or after that date, as well as to research conduct occurring on or after that date. Prior to this, the Academic Misconduct Rule 2015 applies.

 

The University commits to assisting all students to understand how to engage in academic work in ways that are consistent with, and actively support academic integrity. All coursework students must complete the online Academic Integrity Module (Epigeum), and Higher Degree Research (HDR) students are required to complete research integrity training. The Academic Integrity website provides information about services available to assist students with their assignments, examinations and other learning activities, as well as understanding and upholding academic integrity.

Online Submission

You will be required to electronically sign a declaration as part of the submission of your assignment/examination. Please keep a copy of the assignment/examination for your records. Unless an exemption has been approved by the Associate Dean (Education) submission must be through Turnitin.

Hardcopy Submission

There are no hardcopy submissions in the course.

Late Submission

No late submission of assessment tasks will be permitted. If an assessment task is not submitted by the due date and time, a mark of 0 will be awarded.

Referencing Requirements

The Academic Skills website has information to assist you with your writing and assessments. The website includes information about Academic Integrity including referencing requirements for different disciplines. There is also information on Plagiarism and different ways to use source material.

Extensions and Penalties

Extensions and late submission of assessment pieces are covered by the Student Assessment (Coursework) Policy and Procedure. Extensions may be granted for assessment pieces that are not examinations or take-home examinations. If you need an extension, you must request an extension in writing on or before the due date. If you have documented and appropriate medical evidence that demonstrates you were not able to request an extension on or before the due date, you may be able to request it after the due date.

Privacy Notice

The ANU has made a number of third party, online, databases available for students to use. Use of each online database is conditional on student end users first agreeing to the database licensor’s terms of service and/or privacy policy. Students should read these carefully. In some cases student end users will be required to register an account with the database licensor and submit personal information, including their: first name; last name; ANU email address; and other information.
In cases where student end users are asked to submit ‘content’ to a database, such as an assignment or short answers, the database licensor may only use the student’s ‘content’ in accordance with the terms of service – including any (copyright) licence the student grants to the database licensor. Any personal information or content a student submits may be stored by the licensor, potentially offshore, and will be used to process the database service in accordance with the licensors terms of service and/or privacy policy.
If any student chooses not to agree to the database licensor’s terms of service or privacy policy, the student will not be able to access and use the database. In these circumstances students should contact their lecturer to enquire about alternative arrangements that are available.

Distribution of grades policy

Academic Quality Assurance Committee monitors the performance of students, including attrition, further study and employment rates and grade distribution, and College reports on quality assurance processes for assessment activities, including alignment with national and international disciplinary and interdisciplinary standards, as well as qualification type learning outcomes.

Since first semester 1994, ANU uses a grading scale for all courses. This grading scale is used by all academic areas of the University.

Support for students

The University offers students support through several different services. You may contact the services listed below directly or seek advice from your Course Convener, Student Administrators, or your College and Course representatives (if applicable).

• ANU Health, safety & wellbeing for medical services, counselling, mental health and spiritual support
• ANU Access and inclusion for students with a disability or ongoing or chronic illness
• ANU Dean of Students for confidential, impartial advice and help to resolve problems between students and the academic or administrative areas of the University
• ANU Academic Skills and Learning Centre supports you make your own decisions about how you learn and manage your workload.
• ANU Counselling Centre promotes, supports and enhances mental health and wellbeing within the University student community.
• ANUSA supports and represents undergraduate and ANU College students
• PARSA supports and represents postgraduate and research students