Applied Portfolio Construction draws on previously studied investment principles, theories and techniques. The objective of this course is to enable students to synthesize the acquired financial theories and knowledge in the context of portfolio construction and asset allocation. It focuses on gaps in theory and how they can be managed in practice. Examples include challenges/realities in estimating and implementing portfolio optimisation programs, role of liquidity, and importance of plan governance. It covers topics such as types of investors and their objectives; dimensions of risk; asset allocation; the nature and role of various asset classes (equity, fixed income, alternative assets, FX); building multi-manager portfolios, and implementation issues.

Learning Outcomes

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

1. Implement portfolio construction at the overall plan level, taking into account complex investor objectives and the practical challenges of implementation.
2. Explain in detail the use and limitations of portfolio theory.
3. Describe in detail the main characteristics of key asset classes, and the role they each play within a balanced portfolio.
4. Communicate (in written form) complex portfolio structures and strategies to a diverse audience.

Research-Led Teaching

Students undertaking this course will be taught fundamental skills in Finance that will be applied to many real life applications. The course materials draw on recent concepts, issues and practical information on portfolio construction and asset allocation from various sources, including academic papers, industry research publications and CFA materials. Students are required to read and understand these materials and apply their understanding to tutorial tasks designed to reflect a real life environment.

Examination Material or equipment

The Final exams will be centrally timetabled by Examinations, Graduations & Prizes prior to the examination period. Please refer to ANU Timetabling for further information. You will require a non-programmable scientific calculator for the duration of in-workshop test, and the final exam.

Required Resources

Reading List

The Course Reading List will be provided on Wattle. The list is divided into ‘examinable’ and ‘supplementary’ readings. Examinable readings may be directly tested in the exams.

Supplementary materials are provided for additional information and/or assistance in preparation of the assignment or tutorials, and will not be directly tested in exams beyond the extent covered in the lectures, workshops or tutorials. Additional course readings may be made available during the semester. Students should check Wattle to ensure they are using an up-to-date reading list.

Readings will come from a range of sources, including journal and industry articles, websites and the textbook SPH (Stewart, S., Piros, C. and Heisler, J., Portfolio Management: Theory and Practice, John Wiley & Sons, 2019, purchase optional). With the exception of the textbook, all readings will be provided on Wattle.

Recommended Resources

Stewart, S., Piros, C. and Heisler, J., Portfolio Management: Theory and Practice, John Wiley & Sons, 2019 [denoted 'SPH'].

Electronic copies are available at ANU library: https://ebookcentral.proquest.com/lib/anu/detail.action?pq-origsite=primo&docID=5741214

Staff Feedback

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

• written comments
• verbal comments
• feedback to whole class, groups, individuals, focus group etc

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

Tutorials

The tutorial exercises consist of two types of tasks: discussion questions and learning-by-doing Excel based questions. The purposes of the tutorial exercises are two-fold: firstly, give you the exposure of Excel-based quantitative modelling in portfolio analysis which prepares you for the assignment; secondly, help you understand the theories and practices discussed in the lectures using real-world data. Additionally, some calculations from the tutorial exercises are examinable in the exams. You are strongly suggested to learn and practice following the lecture/ tutorial schedule.

Workshops

Workshop is the dedicated forum to help you with your assignment. The lecturer may discuss some popular questions regarding the assignment and provide guidance tackling these problems. Students are encouraged to send assignment questions to the lecturer to make the workshop more relevant.

Consultations

All questions regarding the lectures and the assignment should be directed to the lecturer. Important: before coming to the lecturer’s consultations, make sure you have reviewed all lecture/tutorial/workshop materials and recordings. If you ask an assignment question that has been discussed in workshops you will be asked to listen to the recordings. This policy is to improve the efficiency of the consultation time and give the students who do need face-to-face time with the lecturer a fair chance. The lecturer would very much appreciate your understanding and cooperation.

All questions regarding the tutorials should be directed to your tutor.

Class Schedule

Week/Session	Summary of Activities	Assessment
1	Lecture: Course introduction Overview of portfolio managementWorkshop: No workshop this week
2	Lecture: Objectives, Dimensions of risk Workshop: Excel functions and formulas; Different forms of returns
3	Lecture: Asset allocation: Theory and practice; Mean-variance model Workshop: Excel “solver”
4	Lecture: Asset allocation: Asset assumptions Workshop: Introduction of the assignment
5	Lecture: Asset allocation: Additional methods; Alpha and BetaWorkshop: Get started with the assignment	In-tutorial test
6	Lecture: Traditional assets - Equities Workshop: Decide the approach/approaches
7	Lecture: Traditional assets - Fixed income Workshop: Apply quantitative analysis methods
8	Lecture: Alternative assets - Overview; Property; InfrastructureWorkshop: Assignment
9	Lecture: Alternative assets continued - Hedge funds; Private equity; Commodities Workshop: Write up the report
10	Lecture: Global investing and currency hedging; The investment process Workshop: Assignment	Group Assignment due
11	Lecture: Other topics part 1Workshop: No workshop this week
12	Lecture: Other topics part 2Workshop: Final exam review

Tutorial Registration

Tutorials will be available on campus and held weekly (starting from week 2). Students should enrol in their tutorial using MyTimetable. 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. Find out more 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
In-tutorial test	15 %	17/03/2025	28/03/2025	1,2,3
Group Assignment	30 %	09/05/2025	23/05/2025	1,2,3,4
Final Exam	55 %	29/05/2025	26/06/2025	1,2,3

* 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
• Extenuating Circumstances Application
• 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

Lectures and workshops are delivered weekly on-campus (recorded and available via echo360 on Wattle). Students are strongly encouraged to participate the lectures and workshops, as effective learning is far more sophisticated than listening to a recording.

Tutorials start from week 2, delivered on campus. All students are strongly encouraged to participate the on-campus tutorial as much as possible.

Attendance at lectures, workshops, and tutorials, while not compulsory, is expected in line with "Code of Practice for Teaching and Learning", clause 2 paragraph (b).

Examination(s)

The final exam will be centrally timetabled by examinations. Please check ANU Timetabling for further information.

Assessment Task 1

In-tutorial test

In-tutorial test will be held in person during week 5 tutorials. The duration of the test is 45 minutes writing time plus 5 minutes reading time. Materials permitted in the exam are non-programmable calculator, and one A4 page with notes on both sides (written or typed). A mixture of theoretical and practical questions will be asked, covering all materials from week 1 to week 4. The exam may consist of multiple-choice questions, short-answer calculation questions and short-answer written questions. Guidelines of the exam will be provided in week 4. The test is redeemable for this course. If redeemed, the weighting will be moved to the final exam.

Assessment Task 2

Group Assignment

The assignment involves writing a portfolio construction advice for a client. The assignment is to be done in groups of 3 - 4 students. All students MUST sign up for an assignment group at Wattle by Week 4. A dedicated Students Forum is created to facilitate group forming at Wattle. Signing up for assignment groups is not restricted by tutorial enrollment. If you have to do the assignment as an individual task due to any reason, you need the lecturer’s approval to do so. Otherwise, all students who do not sign up for an assignment group will be randomly allocated to a group by the end of Week 4. It is the students’ responsibility to contact other group members. The assignment requires students to conduct quantitative and qualitative analysis to produce an asset allocation advice for a specific client given certain constraints and objectives. The weekly workshop is dedicated to provide details of the assignment and guidance on analysis, starting from Week 2. All group members receive the same assignment grade. Marking criteria will be discussed in Week 4 workshop: Introduction of the assignment. A detailed marking sheet used by the lecturer is attached to the Assignment file, available on wattle no later than the end of Week 4. The assignment is due at 2:00 pm, Friday Week 10. Submission is by Wattle only. Assignment grade and feedback will be uploaded to wattle about two weeks after the due date, before the final exam. Students will have chance to discuss with the lecturer of the assignment grade and feedback before the final exam.

Assessment Task 3

Final Exam

A compulsory final examination will be held during the university examination period at the end of semester. The exam will be on campus and will cover the entire syllabus. The duration of the final exam is two hours writing time, plus 15 minutes reading time. Materials permitted in the exam are non-programmable calculator, and one A4 page with notes on both sides (written or typed). No Dictionary allowed. A mixture of theoretical and practical questions will be asked. Students will need to review all examinable materials pertaining to the course, including all Examinable readings and contents covered in lectures/workshops/tutorials drawn from Supplementary readings. Guidelines of the exam will be provided in week 10. Centrally administered examinations through Examinations, Graduations & Prizes will be timetabled prior to the examination period. Please check ANU Timetabling for further information.

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. Please keep a copy of the assignment for your records. Unless an exemption has been approved by the Associate Dean (Education) submission must be through Turnitin.

Assignments are submitted using the course Wattle site. Hard copy or email submission is only acceptable by the approval of the lecturer before the assignment is due on a case by case basis. Only one submission is required from each group. Please keep a copy of the assignment for your records. Important: to correctly record assignment marks in the Gradebook, each student must sign up for a Group on Wattle, including one-person groups.

Hardcopy Submission

There's no hard copy submission for this course.

Late Submission

Late submission permitted.

Late submission of assessment tasks without an extension are penalised at the rate of 5% of the possible marks available per working day or part thereof. Late submission of assessment tasks is not accepted after 10 working days after the due date, or on or after the date specified in the course outline for the return of the assessment item. Late submission is not accepted for take-home examinations.

Extension of the assignment is not usually considered by the lecturer as the assignment is done by a large group of students and to be completed from week 4 to week 10

progressively. Other group members are expected to complete the tasks even if one or more members were not able to due to any uncontrollable reasons. No extension or

special consideration will be granted to small teams (eg. less than 3 students due to unexpected drop out of some members).

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. Any use of artificial intelligence must be properly referenced. Failure to properly cite use of Generative AI will be considered a breach of academic integrity.

Returning Assignments

Feedback to the assignment is to be returned via wattle or email before final exam.

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.

Resubmission of Assignments

No resubmission of assignment is accepted.

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 Accessibility 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 supports you make your own decisions about how you learn and manage your workload.
• ANU Counselling promotes, supports and enhances mental health and wellbeing within the University student community.
• ANUSA supports and represents all ANU students