50663/49991: Thursdays 5:35 p.m. to 6:15 p.m.
at the New York campus, Rm W404 (G-PACT room)
Email: email@example.com Tel: (212) 346-1817
|Office||W486, Pace New York|
|Office hours:||Tuesdays: 3:30 p.m. to 5:30 p.m.; Thursdays: 12:20 p.m. to 1:20 p.m. and 3:30 p.m. to 5:30 p.m. and by appointment|
The Focus of the Course will be Fundamental Analysis, i.e. Discounted Cash Flow Analysis.
Topics to be covered in the course:
Estimation of Discount Rates (Chaps 7, 8)
Quality of Earnings Numbers (Chaps 9, 10)
Estimating Growth (Chap 11)
Dividend Discount Model (Chap 13)
FCFE Model (Chap 14)
Fundamental Principles of Relative Valuation (Chap 17)
Earnings Multiples (Chap 18)
Book Value Multiples (Chap 19)
If we have time, we will talk about other topics, such as “How to Integrate Fundamental Analysis into Portfolio Theory,” from Bodie, Kane and Marcus.
The challenge will be in how we will integrate
the discussion of the topics and relate them to the actual stocks that will be
After examining the fundamentals of valuation, student groups will make presentations (starting no earlier than the fourth week). There will be no more than two (perhaps one presentation) each week; hence each group will make a maximum of two presentation during the entire semester. We will also have speakers joining us from time to time; based on the availability of these speakers, we will modify the above time-table.
Since this is an advanced course in Finance, you will be expected to do a lot of reading on your own. Class meetings will be an opportunity to discuss the issues raised in the relevant textbook chapters, and to engage in exercises designed to improve understanding of finance concepts. Here are two examples of how this will be done. One, I will assign very recent Wall Street Journal articles, which you will read and comment on. Two, you will use the G-PACT (Global Portfolio Analysis Center; W404) and other resources to research and report on a selected company; you will analyze and apply the various principles you will learn in the course, to this company.
I believe this course will be a very exciting course. However, given that we will be investing real dollars, it is a serious course. Also, for the same reason, we will all need to do our homework, in more senses than one. Sometimes, particularly, in the beginning, we might need to move faster, so that we can quickly arrive at a stage where we are ready to invest the money that is to be entrusted to us. Also, given the nature of the task, there is going to be a lot of ambiguity in what we will be reading, and what we will be doing. By and by, things will be clearer. However, I hope that you will take these facts in your stride. I am sure that each one of you is eager to learn (as am I), and is willing to put in the necessary time and effort to that end (as am I). If that is not your goal, you will be disappointed with this course because the work load is not light. On the other hand, for those who are willing to work at it, the end results should be worth it. So let's work together as a team, and go for it!
Text: Aswath Damodaran: Investment Valuation, 2001, John Wiley and Sons (http://www.stern.nyu.edu/~adamodar/New_Home_Page/valn2ed/book.htm)
In this course, you will need to use the computer and the Internet a lot.
You should also obtain a Pace e-mail address as soon as possible, so that I can send you e-mail. Any student's Pace e-mail address can be obtained by going to the Contact Pace section of the main Pace Home Page (the default password is the student’s Pace Identification Number). More information about e-mail address, etc. can be obtained from the DoIT website. Even if you have another e-mail address where you wish to get your e-mail, you should still get a Pace e-mail address. Once you have your Pace e-mail account and password, you can go to the Pace University Student E-Mail Server at http://stmail.pace.edu and have your e-mail forwarded to your preferred e-mail address. You can find information on how to have your mail automatically forwarded at http://www.pace.edu/DoIT/forward/. The only way that I can communicate with you is through your Pace e-mail account. Hence, you should get your Pace account information as soon as possible.
Check your e-mail and the SMIP website on a regular basis. This will enable you to get the maximum from the course. I am available for consultation by e-mail at firstname.lastname@example.org. I check my e-mail practically every day, and, in most cases, you should get a speedy response to any questions.
We will also be using Blackboard as a gateway for some aspects of the course. Please log in to Blackboard at the earliest opportunity. Blackboard login procedures can be found on the appropriate Blackboard site. Essentially, your login ID for Blackboard will be your email ID, and your password will be your 9-digit social security number (for more details, go to the Blackboard site).
Class attendance is mandatory; because of the collaborative nature of the course, it is very important that you attend every class meeting.
I also suggest strongly that you read the Wall Street Journal and/or the business section of the New York Times on a regular basis. If you wish to subscribe to the Wall Street Journal, you can do so from the SMIP Class Page. If you have access to the Economist, I suggest you read that, as well. There is no publication that gives as much in-depth coverage to so many issues!
Assignments are a critical part of the course. The main purpose of these assignments is to make sure that you understand the material, and to prepare you for the exams. Details of assignments will be provided in class. You may only submit assignments as part of a team, unless advised otherwise by me; hence you should form your teams immediately. Each team may consist of three to five members. I expect you to form your own teams. (However, if need be, I will assign students to teams, depending upon the need, as I perceive it.) By the beginning of the second week of classes, each team should give me a filled-out copy of the Team Contract. The team contract should be filled out in full, and should be signed by all team members.
Although assignments will be turned in by the team as a unit, I expect all members of a team to participate equitably in the work involved. I also expect each member of the team to work on each project; this is also in your own interests because the assignments are useful preparation for the exams. Every project submitted must also include a listing of which parts of the assignment were worked on by which team members. Whether or not a given team member worked on a specific part of the assignment, s/he must be familiar with the entire assignment that is turned in. I also expect each team member to have a copy of the final version of the submitted assignment; if any team member does not have a copy of the final assignment and/or s/he is not familiar with any part of the submitted assignment, I will reduce that team member's grade for that assignment. You may also use teams for joint learning and study: that is up to the members of each team. Teams may also want to assign members on a rotating basis to keep track of whatever is posted on the Web. However, each student is separately responsible for the material that is put up on the Web. Failure of the designated team member to fulfill his/her duties will not absolve any team member of the responsibility to keep up-to-date vis-a-vis class activities on the Web, or off.
Any student taking this course is presumed to agree to abide by the statement on academic integrity, as described on pages 62-63 of the 2000-2002 Undergraduate Catalog. It is your responsibility to get a copy of this catalog, which can be obtained from Lubin Undergraduate Academic Advisement.
As of now, I do not plan to give any exams. The most important part of the course will be class presentations -- your grade will be based on your class presentations as well as on your comments on other teams' presentations. However, I am thinking of some quizzes or, at least, some class-based exercises to facilitate learning.
On my webpages, you will find recent media articles. From time to time, I will add to this list. There are several reasons why you should look regularly at these pages.
The password, necessary to access the Media Articles section will be announced in class, and can also be found at the Blackboard website. In case of emergency, you can contact me for the password.
We will use the Discussion Board component of Blackboard to have out-of-class discussions. Please make sure that you check Blackboard regularly. I would suggest daily, if you can, or, at least, every couple of days.
Your final grade will be determined as follows:
|Factor||Impact on grade|
|Your team presentations||80%|
Letter grades will be assigned as follows:
|Course Grade||Quantitative Class Score|
|B+, B, B-||80%-89.99%|
|C-, D+, D||60-69.99%|
Note that the minimum and maximum quantitative scores for plus and minus refinements to the letter grades will be at my discretion. These will be partly determined by the distribution of student scores within each letter grade category. I place a high value on effort; at my discretion, I will raise your grade one notch if I feel that you have tried hard to satisfy all the requirements of the course.
Students must have taken at least one of FIN 351 or FIN 320 in the case of undergraduates and FIN 647 or FIN 652, in the case of graduate students. Permission from me is required, in addition. As a minimum, you should have the following competencies.
On the index card handed out in class, please fill in the information requested below, making sure to number the item that you are responding to. Leave space on the top right hand side for a photograph.
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