International Finance

Code:

2FI05

Acronym:

IF

Keywords
Classification	Keyword
OFICIAL	Management Studies

Instance: 2019/2020 - 1S

Active?	Yes
Responsible unit:	Management
Course/CS Responsible:	Master in Finance

Cycles of Study/Courses

Acronym	No. of Students	Study Plan	Curricular Years	Credits UCN	Credits ECTS	Contact hours	Total Time
MIF	54	Bologna Official Syllabus	1	-	3,5	27	94,5

Teaching language

English

Objectives

The aim of the course is to provide tools and techniques for supporting the decision-making for companies acting in an international context. We will address issues related to: the international finance environment; exchange rates forecasting; measuring and managing exchange rate exposure; and multinational capital budgeting (including country risk analysis and estimation of the international cost of capital).

Learning outcomes and competences

Students successfully completing this course should be able to:
1) describe the main functions and characteristics of international financial markets;
2) devise arbitrage strategies in order to exploit price divergences in international financial markets;
3) identify the main risk factors affecting companies that operate in an international context;
4) create risk management strategies using international financial market instruments.

Working method

Presencial

Pre-requirements (prior knowledge) and co-requirements (common knowledge)

Pre: Findamentals of Financial Theory and Financial Management (including Capital Budgeting) and International Finance
Co: Basics of Financial Derivatives

Program

1. The international financial environment 
   1.1 The multinational financial management 
   1.2 The international flows of funds 
   1.3 International financial markets 
   1.4 The determination of the exchange rate 
   1.5 The currency derivatives 
   
   2. The exchange rates behavior 
   2.1 The influence of governments 
   2.2 The international arbitrage and interest rate parity 
   2.3 The relationships among interest rate, inflation rate and exchange rate 
   
   3. The exchange rate risk management 
   3.1 Forecasting the exchange rate 
   3.2 Measuring exposure to exchange rates fluctuations 
   3.3 Managing transaction exposure 
   3.4 Managing economic exposure and translation exposure 
   
   4. The international investment decisions 
   4.1 Foreign direct investment 
   4.2 Multinational capital budgeting 
   4.3 Country risk analysis 
   4.4 Long-term financing

Mandatory literature

Eun, Cheol S.; International financial management. ISBN: 978-0-07-803465-7
Madura, Jeff; International financial management. ISBN: 978-1-4080-3229-9
Eiteman, David K.; Multinational business finance. ISBN: 978-0-13-612156-5

Complementary Bibliography

Levi, Maurice D.; International finance. ISBN: 978-0-415-77459-8

Teaching methods and learning activities

The teaching method includes moments where the main theoretical and conceptual aspects will be presented, and also moments where concepts and theories will be applied by solving real-world problems and case studies. 

Distributed evaluation with no final exam.

keywords

Social sciences > Economics > Management studies > Financial management

Evaluation Type

Distributed evaluation with final exam

Assessment Components

Designation	Weight (%)
Teste	60,00
Trabalho escrito	40,00
Total:	100,00

Amount of time allocated to each course unit

Designation	Time (hours)
Estudo autónomo	40,00
Frequência das aulas	21,00
Trabalho de investigação	20,00
Total:	81,00

Eligibility for exams

Distributed evaluation with no final exam.

Calculation formula of final grade

Assignment: 40% (3 students). Delivery: last session.
Exam: 60%.

The students are required to have done the assignment in order to have access to the exam (article 9, n. 1, a) of the grading rules).

Exam minimum grade is 10 out of 20.

Classification improvement

Retake exam