FNCE100 - CORPORATE FINANCE (Course Syllabus)
This course provides an introduction to the theory, the methods, and the concerns of corporate finance. The concepts developed in FNCE 100 form the foundation for all elective finance courses. The main topics include: 1) the time value of money and capital budgeting techniques; 2) uncertainty and the trade-off between risk and return; 3) security market efficiency; 4) optimal capital structure, and 5) dividend policy decisions. During the Fall semester there are honors sections of FNCE 100 offered. The seats in the honors sections are awarded through an application process. Please go to: https://fnce.wharton.upenn.edu/programs/course-applications for additional information.
Prerequisites: ECON 010 or ECON 001 or ECON 002, MATH 104, or MATH 110, ACCT 101 and STAT 101. Acct 101 and Stat 101 may be taken concurrently.
FNCE101 - MONETARY ECON & GLOB ECO (Course Syllabus)
FNCE 101 is an intermediate-level course in macroeconomics and the global economy, including topics in monetary and international economics. The goal is to provide a unified framework for understanding macroeconomic events and policy, which govern the global economic environment of business. The course analyzes the determinants and behavior of employment, production, demand and profits; inflation, interest rates, asset prices, and wages; exchange rates and international flows of goods and assets; including the interaction of the real economy with monetary policy and the financial system. The analysis is applied to current events, both in the US and abroad. HONORS FNCE 101 is only offered in the Fall semester. Registration for this class is through an application process. Please go to: https:fnce.wharton.upenn.edu/programs-course-applications, This course presents the analysis of macroeconomic theory with a current events perspective. The material in the class concentrates on lecture notes, which are the primary learning source, and readings from a course packet of articles drawn from journals, magazines, newspapers, and other economic publications. The material covered will include: (1) Economic Statistics, GDP, Price Indices,Productivity and the nature of the business cycle, (2) The government budget and Social Security, (3) Monetary policy, The Fed and other Central Banks,(4) Interest rates - indexed bonds and ther term structure (5) Aggregate Demand and the determination of income and interest rate, (6) Money and Inflation - the Velocity Approach, (7) Reaction of Financial Markets to economic data,(8) Inflation, inflationary expectations and the Phillips Curve,(9) Supply-side shocks and macro-dynamics, (10) International Balance of Payments, the current account and capital flows, (11) Determination of Exchange Rates, exchange rate systems, purchasing power and interest rate parity.
Prerequisites: ECON 010 or ECON 001 and ECON 002 and MATH 104 or MATH 110. Students cannot receive credit for both FNCE 101 and ECON 102. WHARTON STUDENTS ARE REQUIRED TO TAKE FNCE 101
FNCE203 - ADVANCED CORP FINANCE (Course Syllabus)
The objective of this course is to study the major decision-making areas of managerial finance and some selected topics in financial theory. The course reviews the theory and empirical evidence related to the investment and financing policies of the firm and attempts to develop decision-making ability in these areas. This course serves as an extension of FNCE 100 (FNCE 611). Some are as of financial management not covered in FNCE 100 are covered in FNCE 203. These may include leasing, mergers and acquisitions, corporate reorganizations, financial planning and working capital management, and some other selected topics. Other areas that are covered in FNCE 100 are covered more in depth and more rigorously in FNCE 203. These include investment decision making under uncertainty, cost of capital, capital structure, pricing of selected financial instruments and corporate liabilities, and dividend policy. During the Spring semester, Professor Opp does not allow students to take this course pass/fail.
Prerequisites: FNCE 100, (FNCE 611), STAT 101, and STAT 102.
Other Information: Professor Opp's sections may not be taken Pass/Fail.
FNCE205 - INVESTMENT MANAGEMENT (Course Syllabus)
This course studies the concepts and evidence relevant to the management of investment portfolios. Topics include diversification, asset allocation, portfolio optimization, factor models, the relation between risk and return, trading, passive (e.g., index-fund) and active (e.g., hedge-fund, long-short) strategies, mutual funds, performance evaluation, long-horizon investing and simulation. The course deals very little with individual security valuation and discretionary investing (i.e., "equity research" or "stock picking").
Prerequisites: The prequisites for Undergraduates are FNCE 100, and STAT 101, 102 (STAT 102 may be taken concurrently with this course. Given that investment management requires one to analyze and deal effectively with uncertainty, a good grounding in statistics is essential, and familarity with statistics should extend through multiple regression, covariance, and correlation.
FNCE206 - FINANCIAL DERIVATIVES (Course Syllabus)
This course covers one of the most exciting yet fundamental areas in finance: derivative securities. In the modern financial architecture, financial derivatives can be the most challenging and exotic securities traded by institutional specialists, while at the same time, they can also be the basic securities commonly traded by retail investors such as S&P Index Options, Beyond trading, the basic ideas of financial derivatives serve as building blocks to understand a much broader class of financial problems, such as complex asset portfolios, strategic corporate decisions, and stages in venture capital investing. The golobal derivatives market is one of the most fast-growing markets, with over $600 trillion notional value in total. It is important as ever to understand both the strategic opportunities offered by these derivative instruments and risks they imply. The main objective of this course is to help students gain the intuition and skills on (1) pricing and hedging of derivative securities, and (2) using them for investment and risk management. In terms of metholologies, we apply the non-arbitrage principle and the law of one price to dynamic models through three different approaches: the binomial tree model, the Black-Scholes-Merton option pricing model, and the simulation-based risk neutral pricing approach. We discuss a wide range of applications, including the use of derivatives in asset management, the valuation of corporate securities such as stocks and corporate bonds with embedded options, interest rate derivatives, credit derivatives, as well as crude oil derivatives. In addition to theoretical disucssions, we also emphasize practical considerations of implementing strategies using derivatives as tools, especially when no-arbitrage conditions do not hold.
Prerequisites: The following introductory Finance and Statistics courses are recommended but not required. FNCE 101 and STAT 102 are recommended and can be taken concurrently.
FNCE207 - CORPORATE VALUATION (Course Syllabus)
The focus of this course is on the valuation of companies. The course covers current conceptual and theoretical valuation frameworks and translates those frameworks into practical approaches for valuing companies. The relevant accounting topics and the appropriate finance theory are integrated to show how to implement the valuation frameworks discussed on a step-by-step basis. The course teaches how to develop the required information for valuing companies from financial statements and other information sources in a real-world setting. Topics covered in depth include discounted cash flow techniques and price multiples. In addition, the course covers other valuation techniques such as leveraged buyout analysis.
Prerequisites: FNCE 100, (FNCE 611) ACCT 101, AND STAT 101, 111 OR EQUIVALENT ACCT 201 RECOMMENDED
FNCE208 - INTERNATIONAL CORP FINAN (Course Syllabus)
Analyzes financial problems corporations face that result from operating in an international environment. Major topics include managing exchange risk through hedging and financing, measuring exchange rate exposure, calculating the cost of capital for foreign operations, assessment of sovereign risks, capital budgeting from a project and parent perspective, and international taxation.
Prerequisites: A thorough knowledge of FNCE 100 (FNCE 611) is assumed.
FNCE209 - REAL ESTATE INVESTMENTS (Course Syllabus)
This course provides a broad introduction to real estate with a focus on investment and financing issues. Project evaluation, financing strategies, investment decision making and real estate capital markets are covered. No prior knowledge of the industry is required, but students are expected to rapidly acquire a working knowledge of real estate markets. Classes are conducted in a standard lecture format with discussion required. The course contains cases that help students evaluate the impact of more complex financing and capital market tools used in real estate. There are case studies and two midterms, depending on instructor.
Prerequisites: FNCE 100
FNCE219 - INTL FINANCIAL MARKETS (Course Syllabus)
FNCE 219 is a course on international financial markets. Major topics include foreign exchange rates, international money markets, currency and interest rate derivatives (forwards, options, and swaps), international stock and bond portfolios, and cryptocurrencies. Students learn about the features of financial instruments and the motivations of market participants. The class focuses on risk management, investing, and arbitrage relations in these markets.
Prerequisites: The following introductory courses are recommended but not required. FNCE 100, FNCE 101, STAT 101.
FNCE220 - INTERNATIONAL BANKING (Course Syllabus)
This course focuses on international financial institutions, especially the activities of global, systemically important banks. We will examine how current and historical events are reshaping the industry and highlight the basic analytics of managing a bank's exposure to liquidity, credit, market and reputational risk. Most classes will begin with discussion of a current event related to course topics. Three team projects will be assigned that will give you deeper exposure to analytic techniques related to the course. Throughout the semester, we will discuss public policy issues facing the international financial system.
Prerequisites: FNCE 100, FNCE 101, one of which may be taken concurrently.
FNCE230 - URBAN FISCAL POLICY (Course Syllabus)
The purpose of this course is to examine the financing of governments in the urban economy. Topics to be covered include the causes and consequences of the urban fiscal crisis, the design of optimal tax and spending policies for local governments, funding of public infrastructures and the workings of the municipal bond market, privatization of government services, and public financial systems for emerging economies. Applications include analyses of recent fiscal crises, local services and taxes as important determinants of real estate prices, the infrastructure crisis, financing and the provision of public education, and fiscal constitutions for new democracies using South Africa as an example.
Prerequisites: FNCE 101 and ECON 001
FNCE235 - FIXED INCOME SECURITIES (Course Syllabus)
This course covers fixed income securities (including fixed income derivatives) and provides an introduction to the markets in which they are traded, as well as to the tools that are used to value these securities and to assess and manage their risk. Quantitative models play a key role in the valuation and risk management of these securities. As a result, although every effort will be made to introduce the various pricing models and techniques as intuitively as possible and the technical requirements are limited to basic calculus and statistics, the class is by its nature quantitative and will require a steady amount of work. In addition, some computer proficiency will be required for the assignments, although familiarity with a spreadsheet program (such as Microsoft Excel) will suffice.
Prerequisites: FNCE 100 and STAT 101 or STAT 102 or STAT 111
FNCE238 - CAPITAL MARKETS (Course Syllabus)
The objective of this course is to give you a broad understanding of the framework and evolution of U.S. capital markets, the instruments that are traded, the mechanisms that facilitate their trading and issuance, and the motivations of issuers and investors across different asset classes. The course will highlight the problems that capital market participants are seeking to solve, which you can use in your post-Wharton careers to evaluate future market innovations. We will consider design, issuance, and pricing of financial instruments, the arbitrage strategies which keep their prices in-line with one another,and the associated economic and financial stability issues. We will draw from events in the aftermath of the recent financial crisis, which illustrate financing innovations and associated risks, as well as policy responses that can change the nature of these markets.
Prerequisites: FNCE 100,(FNCE 611)
FNCE239 - BEHAVIORAL FINANCE (Course Syllabus)
There is an abundance of evidence suggesting that the standard economic paradigm - rational agents in an efficient market - does not adequately describe behavior in financial markets. In this course, we will survey the evidence and use psychology to guide alternative theories of financial markets. Along the way, we will address the standard argument that smart, profit-seeing agents can correct any distortions caused by irrational investors. Further, we will examine more closely the preferences and trading decisions of individual investors. We will argue that their systematic biases can aggregate into observed market inefficiencies. The second half of the course extends the analysis to corporate decision making. We then explore the evidence for both views in the context of capital structure, investment, dividend, and merger decisions.
Prerequisites: FNCE 100, FNCE 101. Recommended: FNCE 205 and FNCE 203
FNCE250 - VENT CAP & FNCE INNOVAT (Course Syllabus)
This course covers the finance of technological innovation, with a focus on the valuation tools useful in the venture capital industry. These tools include the "venture capital method," comparables analysis, discounted cash flow analysis, contingent-claims analysis. The primary audience for this course is finance majors interested in careers in venture capital or in R&D-intensive companies in health care or information technology.
Prerequisites: FNCE 100 (FNCE 611) and FNCE 101 (FNCE 613); (FNCE 101 and FNCE 613 may be taken concurrently)
FNCE251 - FNCE OF BUYOUTS & ACQS (Course Syllabus)
The course focuses on financial tools, techniques, and best practices used in buyouts (financial buyers) and acquisitions (strategic buyers). While it will touch upon various strategic, organizational, and general management issues, the main lens for studying these transactions will be a financial one. It will explore how different buyers approach the process of finding, evaluating, and analyzing opportunities in the corporate-control market; how they structure deals and how deal structure affects both value creation and value division; how they add value after transaction completion; and how they realize their ultimate objectives (such as enhanced market position or a profitable exit). The course is divided into two broad modules. The first module covers mergers and acquisitions, and the second one studies buyouts by private equity partnerships. During the spring semester this course cannot be taken pass/fail.
Prerequisites: FNCE 100 (FNCE 611), FNCE 101 (FNCE 613), Co-Requisite FNCE 203 (FNCE 726) Advanced Corporate Finance or FNCE 207 (FNCE 728) Corporate Valuation.
Other Information: Lectures, cases, and guest speakers. Grading: Class participation, two students projects, two exams.
FNCE254 - IMPACT INVESTING (Course Syllabus)
This course explores Impact Investing, a discipline that seeks to generate social benefits as well as financial returns. From tiny beginnings, the Impact Investment space has expanded and now commands significant attention from policymakers, wealthy and public-spirited individuals, academia and, not least, the world's largest asset managers and philanthropic foundations. Evangelists believe it may be the key to freeing the world from poverty. Skeptics think it will remain confined to the boutique. Regardless, Impact Investing is becoming a distinct career specialization for finance professionals despite the diverse skillset each must have and the uncertainty of the new field's growth.
Prerequisites: Prerequisites This course has no specific prerequisites, but given its wide-ranging subject matter, students will benefit from completion of any of the following Wharton courses: FNCE 101 Monetary Economics and the Global Economy; FNCE 205 Investment Management; FNCE 238 Capital Markets; and FNCE 395 Private Equity. Coursework or practical experience in microeconomics, development economics, international philanthropy, Non-Governmental Organizations, financial risk management and political risk analysis will also be useful.
FNCE256 - ENERGY FINANCE (Course Syllabus)
The objective of this course is to provide students with detailed knowledge of corporate structures, valuation methods, project finance, risk management practices, corporate governance issues, and geo-political risks in the energy industry. In general, this course seeks to provide students with an overall context for understanding energy issues and risks, and how these might affect financing and investment decisions for both providers of energy and end-users of energy.
Prerequisites: FNCE 203, Advanced Corporate Finance or FNCE 207, Corporate Valuation. Students that receive permission to enroll without the prerequisites are expected to review the relevant topics as necessary to meet the requirements of the class.
FNCE311 - INFRASTRUCTURE INVESTING
The world economy runs on the infrastructure which has been built over the past 10,000 years. Each year, this infrastructure requires updating and new additions, from roads and bridges (the original infrastructure), to railroads, airports (the more recent infrastructure), to telecommications and solar and wind power installations (modern infrastructure). There is a vast amount of public (i.e., taxpayer money directed by government officials) and private (i.e., individuals' money typically managed on their behalf and directed by private equity or banks into infrastructure investments). In this course, we will cover Infrastucture Financing and investing from various angles. We will provide descriptions of types of infrastructure, examine the financing needs of infrastructure projects, consider the historic role of government and non-government funding, and assess the changing needs of consumers and role of technology and the increasing demands posed by a globalizing economy. As private equity firms continue to build infrastructure funds, the need for, and role for, private money continues to evolve, so we will also examine infrastructure investing as a alternative asset class from the investors' perspective.
Prerequisites: FNCE 100 Corporate Finance; FNCE 207 Corporate Valuation is recommended but not required.
FNCE383 - STRATEGIC EQUITY FINANCE (Course Syllabus)
This course combines lectures and cases, and will go through actual situations where companies need to make strategic decisions on raising equity capital. We will address different phases of a company's life cycle. Through these cases, from the decision-makers perspective, we will explore the different paths that can be taken and consider issues such as investor activism, governance and regulatory and valuation impact. FNCE 383 is a half semester course offered in Q3 during the spring semester.
Prerequisites: FNCE 100 - Corporate Finance
FNCE384 - ADVANCED TOPICS IN PE
This course will address a variety of applied topics in private equity (PE), with a focus on growth and later-stage buyout transactions (venture capital is not explicitly addressed in this course), and a primarily U.S.-centric view that should be largely applicable in other markets. In addition, the course will focus on the transaction stage of PE investing i.e., the art of the deal and mostly leave aside deal sourcing, portfolio management and investor relations. The goal of this course is to educate students about the substance, process and mechanics of PE investing, through the lens of the investment professionals, counterparties and advisors that drive transactions to completion. Course topics will address the entire deal process, and will include the following: Commercial Diligence (incl. financial modeling); Debt Financing; Accounting Diligence; Sales & Purchase Agreements; Comps Analysis; and Other Advisory Work. Throughout the course, students will learn about each element of the deal process through in-class lectures, while concurrently apply those learnings to a real-time mock deal, and preparing dealmaterials that mirror a real private equity transaction. The in-class lectures will cover both conceptual frameworks and real-world examples.
Prerequisites: Successful completion of core finance requirements, FNCE 100,and FNCE 101 as well as FNCE 203 or FNCE 251. Special permission can also be requested based on relevant professional experience.
FNCE385 - ASP FIN-TECH (Course Syllabus)
The course exposes students to this fast-growing and exciting intersection between finance (Fin) and technology (Tech) while emphasizing the role data and analytics play. The course is structured around three main FinTech areas: (i) Lending/Banking services, (ii) Clearing (iii) Trading. It provides specific coverage and examples of developments from(1) peer-to-peer lending, (2) blockchain and distributed ledgers, (3) networks and their use in trading, and (4) algo trading and its use of non-standard inputs. In each of these areas, we start by analyzing the marketplace, and the incumbents, and the business case and strategies of the incoming technology-based players, while understanding the role data and analytics play in driving the technology-based services. The course is built around a large number of examples and cases, guest lectures, student presentations, and group projects. Student are thus expected to work in teams and demonstrate a high level of independent learning and initiative.
Prerequisites: A thorough knowledge of FNCE 100 is assumed.
FNCE386 - ASP - HEDGE FUNDS (Course Syllabus)
This course will cover critical aspects and characteristics of hedge funds and the hedge fund industry. It will look at the legal foundations and structures of hedge funds including the primary regulations in the U.S. and abroad that are most relevant for hedge funds. It will also present the major hedge fund strategies, describe operation, control, administration, due diligence and valuation issues. Performance evaluation and investing in hedge funds from the investor's perspective will be discussed as will be issues of potential changes in regulation, risk management, and the use of leverage. The format of the course will mix lectures with presentations from industry participants, hedge fund managers, those who invest in hedge funds, those who advise them and provide services to them, and those who regulate them. Those who want to launch a hedge fund, join an existing one, invest in one, or provide services to one will want to register for this course.
Prerequisites: FNCE 100
FNCE387 - ASP-SHAREHOLDER ACTIVISM
The aim of the course is to provide an introduction to shareholder activism. The course makes use of lectures and case studies. The lectures expose the students to the institutional and empirical facts as well as approaches followed by leading shareholder activists. The case studies are designed to provide students an experience on identifying potential opportunity for value creation thrugh active engagement. Assignments require students to develop/practice skills on fundamental analysis.
FNCE391 - ASP-CORP RESTRUCTURING (Course Syllabus)
This course familiarizes students with financial, strategic and legal issues associated with the restructuring of financially distressed firms. The objective is to give students tools necessary to deal with the often-complex situation facing a failing firm. The participants will gain a basic understanding of the various options available for distressed firms, such as out-of-court workouts, exchange offers, prepackaged and pre-negotiated bankruptcies, distressed asset sales, 363 auctions, and Chapter 11 reorganization. We will explore the difference between economic and financial distress, and the implications for the restructuring process. Since bankruptcy provides a threat point for any distressed restructuring, the course reviews key issues of the legal framework governing bankruptcy and reorganization in the U.S. and internationally. Finally, we will consider distressed debt as an asset class and develop techniques for investing in distressed securities. The course is case based, providing ample opportunity to practice valuation of distressed companies, and hosts several guest speakers from the restructuring industry. It should be of interest for a range of careers, including private equity, investment banking, and turnaround management.
Prerequisites: The prerequisites for the course are FNCE 203/726-Advanced Corporate Finance or FNCE 207/728 Corporate Valuation. The purpose of the prerequisites is to ensure that students have a basic understanding of capital structure, and valuation methods, so that we spend more time on the nuances of distressed situations and less time on reviewing background material.
FNCE393 - ASP POL DECIS BY CT BANK (Course Syllabus)
Understanding and predicting central banking decision making and behavior is crucial for all market participants from asset managers and traders to private consumers. This course aims to provide the methods and knowledge on how central banks and governments think and implement policies to reach the goals of price and financial stability as well as support of growth and employment. The core of the course connects between the legal and actual goals that central banks follow and the related economic analysis on which these goals and policies are set. We explain the economic rationale for the policy prescriptions to reach the goals and how these policies are actually implemented by the Federal Reserve Bank (Fed) in the US, the European Central Bank (ECB), Bank of Israel (BOI) and some remarks on other countries. We use data, current events of the 2007�2018 period as the basis for discussion and assignments. All of these are aimed understanding how and why the Fed, the ECB and the BOI set their policies. For each we shall simulate in class current decisions based on assignment related to past policies and the theory presented in class.
Prerequisites: FNCE100, FNCE 101 and STAT101 or STAT 102
Other Information: Requirements; Final examinations (55%-passing grade is required); two out of three assignments (cases) done by teams of 3-4 students (20%); one group participation (10%); active participation in class discussion (15%)
FNCE395 - ASP PRIVATE EQUITY
The course will be a survey of the private equity asset class. Its objective is to provide an understanding of the concepts, agents, and institutions involved in the late stage corporate private equity market in the U.S. and around the globe. It will examine the buyout market and the activities of buyout funds from the differing perspectives of private equity investors, private equity fund sponsors, and managers of the portfolio companies. The course will be taught almost entirely with cases. Distinguished Wharton alumni in the private equity industry will be our guest speakers for many of the cases based on transactions they concluded. PLEASE NOTE: While this course is primarily intended for graduate students, admission may be granted to a limited number of interested undergraduate students. Be aware that this course may be recorded for live or subsequent distribution, display, broadcast, or commercialization in any media, including video, audio, or electronic media. For additional information, see the course syllabus or contact the department. This is a Pass/Fail course and will not count towards your concentration.
Prerequisites: FNCE 203-Advanced Corporate Finance and FNCE 251-Finance of Buyouts and Acquisitions or permission from the professor
FNCE397 - FNCE IN MID EAST & N AFR
This is a Wharton Global Modular Course on finance in the Middle East and North Africa. Its objective is to bring students, academics and industry experts together to study financial markets, practice, and institutions in this region.
Other Information: Course Format - This course will be taught through cases and lectures. Guest Lecturers - Distinguished practitioners will lecture and conduct case discussions. Our guest lecturers will bring their experience and insights to the classroom.
FNCE399 - INDEPENDENT STUDY
Integrates the work of the various courses and familiarizes the student with the tools and techniques of research.
Prerequisites: Senior standing, 3.4 grade point average. Must be supervised by a Standing Faculty member in the Finance Department.