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Economics
Financial Economics

Financial Economics

Code	14184
Year	1
Semester	S2
ECTS Credits	7,5
Workload	OT(3H)/TP(30H)
Scientific area	Economics
Entry requirements	PhD Students who attend the course need to have previous knowledge of macroeconomics, microeconomics, econometrics, calculous, algebra, and financial and asset markets. The course requires intensive reading with real applications to financial markets.
Learning outcomes	- Understand the decision of an investor to invest in risk assets and free risk assets; - Understand the operation of capital markets; - Learning to estimate the fundamental value of bonds and shares; - Determine the optimal set of portfolios available to an investor; - Determine the profitability of a financial asset; - Estimate the fundamental value of bonds and shares, and evaluate the credit risk and interest rate of a bond. - Assess financial derivative contracts
Syllabus	1. Portfolio theory 2. Capital markets equilibrium models 3. Stock valuation 4. Bond valuation 5. Financial derivatives valuation
Main Bibliography	Main Bodie, Z., Kane, A., and Marcus, A. (2023), Investments, 13th Edition, McGraw-Hill International Editions. Bodie, Z., Merton, R., and Cleeton, D. (2012), Financial Economics, 2nd Edition, Prentice Hall. Sharpe, W., Alexander, G., and Bailey, J.V. (2015), Investments, 7th Edition, Pearson. Hull, J. (2021). Options, Futures, and Other Derivatives, 11th Edition. Pearson. Martellini, L., Priaulet, P., and Priaulet, S. (2001), Fixed-Income Securities: Dynamic Methods for Interest Rate Risk Pricing and Hedging. John Wiley & Sons. Supplementary Various scientific articles to be made available on Moodle
Language	Portuguese. Tutorial support is available in English.