NOTE: This course must be taken prior to or concurrently with enrollment
in any upper-level finance course, unless otherwise noted in a specific
course’s description. This course is not required for upper-level economics
The Capital Markets course has three goals:
To introduce the principles of asset valuation
from an applied perspective. Much of the class is concerned with the valuation
of financial securities, including bonds, stocks, and options. We discuss the
role of valuation in portfolio management and risk management applications.
To develop the following concepts: arbitrage,
the term structure of interest rates, bond duration, portfolio diversification,
risk-return trade-offs, the Capital Asset Pricing Model (CAPM), market
(in)efficiency, performance evaluation, and derivative securities, particularly
To provide sufficient background knowledge for
students seeking an overview of capital markets and an introduction to advanced
Martin Oehmke was a Columbia Business School faculty member from 2008 to 2017.