Checking date: 01/07/2020

Course: 2020/2021

Business and Finance III: Risk Management in non-Banking Entities
Study: Master in Industrial Economics and Markets (270)

Coordinating teacher: SERRANO JIMENEZ, PEDRO JOSE

Department assigned to the subject: Department of Business Administration

Type: Compulsory
ECTS Credits: 6.0 ECTS


Students are expected to have completed
- Business and Finance I - Business and Finance II
Competences and skills that will be acquired and learning results.
Upon completion of this course the students are expected to: -Understand the risk management process; -Understand the value generating mechanisms of risk management; -Understand diversification effects, natural hedging and hedging with financial derivatives; -Understand the differences, benefits and drawbacks of using over the counter and exchange traded financial derivatives; -Perform simple hedging strategies such as: o Natural hedging strategies for currency risk; o Hedging strategies for interest rate risk with forwards and swaps; o Hedging strategies for commodities risk with financial futures; o Hedging strategies for financial assets with financial options; -Understand the differences between Market risk and Credit risk -Understand the standard measures for assessing Market and Credit risks
Description of contents: programme
The course is divided into the following seven chapters: Chapter 1. Risk management and firm value. Chapter 2. Risk management with Forwards and Swaps. Chapter 3. Risk management with Futures and Options. Chapter 4. Hedging options the Greeks. Chapter 5. Market risk. Chapter 6. Credit risk measurement. Chapter 7. Credit derivatives.
Learning activities and methodology
The time in class will be divided between: -Presentation of theory (usually the first class of the week); -Solving and analyzing hedging examples; -Working out examples in class (usually in the second class of the week); - Exercises with computer - programming By working in class it is possible to address and clarify many of the doubts students may have, however the lectures also provide additional and individual office hours.
Assessment System
  • % end-of-term-examination 25
  • % of continuous assessment (assigments, laboratory, practicals...) 75
Basic Bibliography
  • Grinblatt, M., & S. Titman. Financial Market and Corporate Strategy. Irwin/McGraw-Hill. (2003)
  • John C. Hull . Options Futures and Other derivatives. Prentice Hall . (1997)
  • Smithson, C. W. . Managing Financial Risk. 3rd edition. McGraw-Hill. (1998)
Recursos electrónicosElectronic Resources *
Additional Bibliography
  • Hull, John. Risk management & financial institutions. Wiley Finance. 2012
  • Jorion, P.. Financial Risk Manager. Wiley. 2003
Detailed subject contents or complementary information about assessment system of B.T.
(*) Access to some electronic resources may be restricted to members of the university community and require validation through Campus Global. If you try to connect from outside of the University you will need to set up a VPN

The course syllabus and the academic weekly planning may change due academic events or other reasons.