NOTE: This course is required for enrollment in most upper-level finance courses (8300 and 9300) and must be taken prior to or concurrently with any upper-level finance course. It is not required for upper-level economics courses (8200 and 9200).
This Capital Markets course has three goals:
1. To introduce the principles of asset valuation from an applied perspective. The majority of the class is concerned with the valuation of financial securities. The valuation issues to be discussed are heavily used in portfolio management and risk management applications.
2. To introduce the following concepts: arbitrage, the term structure of interest rates, equilibrium pricing, diversification, the Capital Asset Pricing Model (CAPM), efficient and inefficient markets, performance evaluation, and derivative securities, particularly options.
3. To provide sufficient background knowledge for students seeking an overview of capital markets and an introduction to advanced finance courses.
Jialin Yu was a Columbia Business School faculty member from 2004 to 2013.