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|BADM 735 - Info-Based Investment Strat|
This course examines several information-based investment strategies employed by various investment funds throughout the world. The course is designed to enrich students’ understanding of the equity pricing and valuation effects of corporate disclosure, capital structure, macroeconomic forecasts, litigation, political and regulatory outcomes, and other significant information events occurring both internal and external to the firm. Students will develop their ability to identify, interpret, and use financial accounting and other relevant information to back-test and develop their own information-based investment strategies. This course is designed for students with a strong interest in equity research and valuation, asset management, financial consulting, private equity, or investment banking. Working under the premise that active market participants rely on both public and private information when engaging in investment activities, we will attempt to better understand the role of information in the price-setting process and seek out opportunities to exploit pricing inefficiencies arising from significant corporate or exogenous events. We will begin by introducing students to current event-study methodologies, statistical packages (i.e., SAS), and various financial databases, such as SEC Edgar, CRSP, Compustat, and IBES. The course will then feature the following broad topics to be used in pricing and value decisions: event-driven investing; corporate disclosures; financial statement analysis; corporate finance; and exogenous events. Within each topic, students will explore various pricing and valuation opportunities, develop and back-test investment strategies, and interpret results. For example, in one session, we will explore the relative merits and empirical results associated with employing 13f ‘copycat’ strategies, whereby portfolios are adjusted to reflect the past investment decisions of prominent investors. This course strongly emphasizes experiential learning. Throughout the course, students will work in groups to develop, back-test, and cultivate investment ideas. To achieve our objectives, students will read a number of articles from the popular press, analyze corporate disclosures, review analyst reports, and actively engage in classroom discussions. On the final day, students will take an exam and submit a final project.
3.000 Credit hours
3.000 Lecture hours
Levels: MN or MC Graduate
Schedule Types: Lecture
Business Administration Department