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Financial management

Principles of finance, present value and alternative cost of capital, net present value, valuation of bonds and stocks, investment decision and net present value, risk and alternative cost of capital, risk and return, lease or buy, taxes, inflation and return, financial and real options, option valuation and application, hedging, short term finance, cash flow management.

Literature:

  1. Brealey, R.A., Myers, S.C.: Principles of Corporate Finance. McGraw-Hill. 2002
  2. Sharpe, W.F., Alexander G.J.: Investments. USA: Prentice-Hall, Inc. 1999
  3. Stephen, A.R., Randolph W.W., Bradford D.: JordanFundamentals of Corporate Finance Standard Edition. McGraw-Hill. 2005

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Teacher:  Prof. Ing. Oldřich Starý, CSc., Július Bemš

Rules: Students have to be present at 2/3 of lectures.

Textbook: Brealey, Myers: Principals of Corporate Finance, McGraw-Hill (several versions)

Assesment:

Exercises and Exam

Points

Exercises 

60

Tests 2x 

50

Homework

10

Exam

40

Theoretical part and calculations

40

Sum

100

Exam: Student must achieve at least 50 % from theoretical part and at least 50 % from calculations. Only calculator without communication abilities is allowed.

 

  1. Introduction of finance, present value, opportunity cost.
  2. Anuitty, perpetuitty, compounded and simple interests.
  3. Long term finance. Stock and bonds price.
  4. Investment efficiency evaluation techniques. IRR, NPV.
  5. The comparing period, an equivalent annual value.
  6. Decision making with NPV.
  7. Inflation and tax influence to investment decision.
  8. Project is not a black box.
  9. Capital assets pricing model. Basics of portfolio theory.
  10. Capital markets models.
  11. Analysis of senzitivity and risk analysis. Financial risk.
  12. Options, hedge position, option valuation.
  13. Short term financial plans and decison making.
  14. Other financial problems.
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  1. Spreadsheets revision focused on financial management.
  2. Financial calculus.
  3. Loans. Kinds of interests.
  4. Depreciation. Tax shield. Homework assignment.
  5. NPV and IRR calculations. Mutual eliminate investments.
  6. Taxes, finance and NPV.
  7. Inflation influence. Case study.
  8. Bonds and stock price. Model with contant growth.
  9. Expected return and standart deviation of portfolio. Risk free return.
  10. Market portfolio. Securities line. Portfolio with maximal return.
  11. Reading of finacial news.
  12. Quiz. Homework deadline.
  13. Homework discussion.
  14. Put and call options.
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