There is mounting evidence that people violate many of the rationality assumptions of mainstream economics. Behavioural Economics is a relatively new field that studies such violations and proposes theories to explain them. Behavioural finance is a part of behavioural economics that studies important irrationalities on financial markets. Key topics include common mistakes people make when deciding how much to save and how to invest, excess volume of trade, equity premium puzzle, bubbles, and predictability of financial markets. The backbone of the programme consists of a 1st'semester module in behavioural economics and a 2nd'semester module in advanced behavioural finance. Apart from these 2 modules, students can take modules covering more traditional topics in finance. A thorough knowledge of behavioural economics and behavioural finance provides students with a deeper and more realistic understanding of financial markets than is offered by mainstream finance alone. Such knowledge also makes students less susceptible to common mistakes in their own lives and careers.
Pre'sessional modules: Mathematics; statistics. Compulsory modules: Behavioural economics; investments; corporate finance; econometrics for finance; eviews; advanced behavioural finance; data analysis; dissertation. Elective modules: Empirical finance; financial derivatives; advanced asset pricing and modelling; asset management; risk management for banking; applied risk management; international finance; applied futures and options; banking regulations; cases in business finance; topics in applied finance; topics in financial econometrics; bond market strategies; alternative investments; valuation and private equity; topics in actuarial finance and insurance; credit ratings; mergers and acquisitions; Islamic finance in practice; strategic asset allocation; portfolio construction theory.
Course Additional Entry
At least an upper 2nd Class Honours degree (2.1) or overseas equivalent in a subject with some quantitative elements. Subjects likely to contain sufficient quantitative elements (which have at least 1 mathematics or statistics based module) including mathematics, science, engineering, economics, finance, psychology, accounting, business and management.
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