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Capital Markets: Equity Investments

Type of study Bachelor
Language of instruction English
Code 154-0574/01
Abbreviation CMEI
Course title Capital Markets: Equity Investments
Credits 6
Coordinating department Department of Finance
Course coordinator Ing. Martina Novotná, Ph.D.

Subject syllabus

1. Equity market organization and structure
• Classification of assets and markets,
• main market participants and financial intermediaries,
• trading fundamentals (types of positions and orders)
• primary and secondary markets (public offerings, securities regulation).

2. Market efficiency
• The concept and definition of market efficiency,
• forms of market efficiency (weak, semi-strong, strong),
• equity market anomalies, violation of the EMH
• behavioural finance (investor psychology, types of behavioural biases).

3. Overview of equity securities
• Security market indexes (index definition and construction),
• Types of equity indexes and their use (measuring returns, benchmarks),
• types and characteristics of equity securities (types of shares, depository receipts),
• risk and return (sources of risk and return, calculation).

4. Equity valuation: Global, industry and company analysis
• Fundamental analysis and its main objectives, intrinsic value,
• global analysis (macroeconomic analysis),
• the role of industry analysis (business-cycle sensitivities),
• company analysis (financial statement analysis).

5. Equity valuation: Intrinsic Value Calculation
• Equity valuation approaches and their comparison,
• discounted dividend valuation (Gordon model, multistage models),
• market-based valuation (multiplier models),
• asset-based valuation and other approaches.

Literature

BAKER, H. Kent, Greg FILBECK and Halil KIYMAZ. Equity markets, valuation, and analysis. Hoboken: 2020, Wiley. ISBN 9781119632948 .
BODIE, Zvi, Alex KANE and Alan J. MARCUS. Investments. 12th ed. New York: McGraw Hill, 2021. ISBN 978-1-260-57115-8 .
REILLY, Frank K., Keith C. BROWN and Sanford. J. LEEDS. Investment analysis and portfolio management. 11th ed. Boston: Cengage, 2019. ISBN 978-1305262997.

Advised literature

BAKER, H. Kent, Greg FILBECK and John R. NOFSINGER. Behavioral finance: what everyone needs to know. New York, NY: Oxford University Press, 2019. ISBN 9780190868758 .
CALHOUN, George. Price and Value: A Guide to Equity Market Valuation Metrics. Jersey City: Apress, 2020. ISBN 978-1-4842-5551-3 .
LAOPODIS, Nikiforos. Understanding investments: theories and strategies. 2nd ed. London: Routledge, Taylor & Francis Group, 2021. ISBN 978-1000074741