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MSc Financial Management Student Handbook
1. The MSc Financial Management
The MSc Financial Management is targeted at finance professionals and other professionals, who would like to develop a career in finance, require a wide ranging understanding of financial techniques and their application but do not require high level mathematical understanding of finance theories. The MSc offers specialist study in the areas of corporate finance, investments, and risk management. It will give you a relevant practical knowledge of finance that can be put into use straight away. Careers in finance depend upon a strong understanding of the foundations of finance, investment behaviour, and the dynamic nature of finance. The MSc will provide a strong preparation for a career in a wide variety of positions within the finance profession.
2. Foundations of financial analysis
A firm is faced with three key decisions; the financing decision, the investment decision, and the dividend decision, this is the process of raising capital, investing capital and returning capital back to shareholders. The basic concepts of discounting, risk analysis and options, together with an understanding of how the financial data are derived form the basis for understanding these decisions and conducting financial analysis at all levels. An understanding of the basic business analytical framework in mathematics and statistics is essential and the three fundamental courses of Finance, Accounting, and Quantitative Methods provide a formidable set of intellectual tools in their own right. Financial specifics
Effective financial management results in the creation of wealth for shareholders and key to that will be selecting economic investment projects and having an appropriate mix of debt and equity in its capital structure. However, by increasing the amount of debt in the firm the firm is increasing the risk of financial distress. Finance is largely concerned with the identification and management of the risks that face the firm: interest rate, exchange rate, credit, assets and portfolio risks require management by all firms. The continual innovation of new financial products from options to credit derivative swaps and the growing role of non-traditional financial institutions such as hedge funds have had a dramatic impact on the capacity of firms to manage risk in ways that could not even be imagined twenty years ago. The risk that a firm faces can be reduced by selling that risk on in the market to others who are willing to be exposed to those risks. An understanding of these issues that will be of practical use will be learnt in the courses of Financial Risk Management, Derivatives and Credit Risk Management.
Finance in the business context
Finance is dynamic and constantly evolving so a strong knowledge of markets, products and institutions and how they interact is vital. Companies can grow organically or they can grow by acquisition. Growth by acquisition is costly and it is a decision that is difficult and expensive to reverse, so it is important that the decision and process is analysed from the initial target identification stage right through to the final post deal integration stage. Because of the fast moving nature of financial markets participants typically do not realise that the current situation is not unique and that there are important lessons to be learned from the past. The analysis of a financial bubble, such as the dot.com mania at the end of the 1990s, has to address some core issues: were valuation methods sensible, what was the impact of macroeconomic factors, what role did monetary policy play and why did buyers and sellers behave in the way they did?
The management of organisations is...