Courses - Fall 2023
BUFN
Finance
600 and 700 level courses with the BUFN prefix are offered only for students in the Master of Finance and Master of Quantitative Financ programs.
BUFN400
(Perm Req)
Introduction to Financial Markets and Financial Datasets
Credits: 3
Prerequisite: STAT400, STAT401, STAT410, or STAT420.
Recommended: CMSC320, CMSC351, MATH240, and MATH241; and should have extensive familiarity with Python including Pandas, Numpy, Scipy, Matplotlib; and familiarity with probability and statistics, econometric modeling.
Restriction: By Permission Only.
Provides an overview of financial concepts and markets and datasets. Company financial statements will be used to review concepts including earnings, cash flow, accruals, investment, dividends, etc. The course will introduce concepts related to portfolio theory and asset pricing. It will introduce the fundamentals of the stock market and market microstructure, including bid ask spreads and market liquidity. Advanced topics include event studies, high frequency trading, Over The Counter (OTC) bond markets, and more specialized institutional arrangements including repo markets and foreign currency exchange markets.
Computer Science majors who would like to take this course should email Professor Albert Kyle askyle4@umd.edu and Professor Louiqa Raschid lraschid@umd.edu for permission to register for this course.
BUFN401
(Perm Req)
Option Theory and Derivatives
Credits: 3
Prerequisite: BUFN400.
Will introduce Option Theory and the concept of a derivative financial contract whose value is based on some underlying asset, e.g., a stock or bond or commodity. Option theory based pricing models are a cornerstone of modern finance. Unlike the Capital Asset Pricing Model (CAPM) that determines an appropriate rate of return, option theory primarily relies on arbitrage arguments, and the probability that an option will be exercised during some time interval. Option theory has been very successful empirically. Common derivative types include stock and bond and index options, futures contracts, forward contract and swaps.
BUFN610
(Perm Req)
Financial Management
Credits: 2
Restriction: Permission of BMGT-Robert H. Smith School of Business; or must be in Business and Management (Master's) program.
Credit only granted for: BUSI640, BUFN610, or BMGT610.
The fundamental concepts and techniques used to evaluate corporate decisions. Topics include the time value of money, valuation of common securities, investment decisions, capital budgeting, capital structure, and the weighted average cost of capital. The objectives are to develop the ability to make investment decisions, manage project finances, and analyze financial decisions.
BUFN620
(Perm Req)
Capital Markets
Credits: 2
Restriction: Must be in one of the following programs (Business and Management (Master's); Business and Management (Master's)) ; or permission of BMGT-Robert H. Smith School of Business.
Credit only granted for: BUFN740 or BUFN620.
Formerly: BUFN740.
Covers modern theories and techniques for analyzing investments in different securities. Introduces mathematical and statistical models to price securities and guide investment decisions. The main topics covered are portfolio theory, pricing models, market efficiency, fixed income investment, and options.
For Master of Finance students only.
BUFN630
(Perm Req)
Valuation in Corporate Finance
Credits: 2
Prerequisite: BUFN610.
Restriction: Must be in one of the following programs (Business and Management (Master's); Business and Management (Master's)) ; or permission of BMGT-Robert H. Smith School of Business.
Credit only granted for: BUFN630, BUFN714, BUFN750, BUFN753, or BMGT730.
Formerly: BUFN750.
An advanced corporate finance course focusing on valuation. The main objective is to apply the concepts covered in the introductory finance class through real-life applications (cases) and use valuation estimates to guide and communicate investment decisions. The topics include building Pro Forma statements and forecasting future cash flows, dynamic cash flow models, estimating the cost of capital, implementing the Weighted Average Cost of Capital (WACC) and Adjusted Present Value (APV) methods, and using real options techniques (binomial and Black and Scholes models as well as Monte Carlo simulations) to value companies and projects.
BUFN640
(Perm Req)
Financial Data Analytics
Credits: 2
Restriction: Must be in Business and Management (Master's) program; or permission of BMGT-Robert H. Smith School of Business.
Credit only granted for: BUFN758N of BUFN640.
Formerly: BUFN758N.
Introduces the skills and computing languages for analyzing financial data and testing financial models. Covers topics such as the ordinary least square regression (OLS) estimator, its properties and applications, statistical inference, and univariate and multivariate analysis. The focus is on working with data and applying econometric models to financial applications such as estimating asset pricing models, portfolio choice, and the efficient frontier. The course will use Python programming language, Google Colab environment, and matching learning packages.
BUFN650
(Perm Req)
Machine Learning in Finance
Credits: 2
Prerequisite: BUFN640.
Restriction: Must be in Business and Management (Master's) program; or permission of BMGT-Robert H. Smith School of Business.
Credit only granted for: BUFN758O or BUFN650.
Formerly: BUFN758O.
A hands-on course on applications of cutting-edge machine learning methods to financial modeling. It builds on the Financial Analytics class to introduce students to a wide variety of machine learning techniques ranging from lasso regression to deep learning and TensorFlow. The course provides the basic ideas and intuition behind these methods, a more formal understanding of how and why they work, and opportunities to experiment with machine-learning algorithms and apply them to big data modeling in finance. It will use the Python programming language, Google Colab environment, and machine learning packages.
BUFN660
(Perm Req)
Derivative Securities
Credits: 2
Prerequisite: BUFN610.
Restriction: Must be in one of the following programs (Business and Management (Master's); Business and Management (Master's)) ; or permission of BMGT-Robert H. Smith School of Business.
Credit only granted for: BUFN660, BUFN726, BUFN761 or BUFN773.
Formerly: BUFN761.
Introduces standard derivative contracts, including forwards and futures, swaps, and options. Covers the mathematical foundation of valuing derivative contracts, the use of static and dynamic replication strategies, and the concept of no-arbitrage. Derivative securities on various underlying assets (equities, indices, commodities, foreign exchange, etc.) are analyzed using different application contexts.
BUFN717
Entrepreneurial Finance and Private Equity
Credits: 2
Prerequisite: BUFN610.
Restriction: Permission of BMGT-Robert H. Smith School of Business; or must be in Business and Management (Master's) program.
Credit only granted for: BUFN755 or BUFN717.
Formerly: BUFN755.
An advanced topics course in Corporate Finance. The major emphasis is how financiers help growing firms - and in particular young start-ups - using different types of securities at different points in the industry's and firm's life. Financing arrangements and securities studied will include private equity funds and private financings placements, Venture Capital (VC) and preferred equity, Investment Banks through Initial Public Offerings (IPOs), Private equity finds, debt and leveraged buyouts. Students will learn additional techniques that will help them understand how financiers value firms and how to understand, plan and value different financing strategies.
BUFN721
International Investment
Credits: 2
Prerequisite: BUFN610.
Restriction: Must be in Business and Management (Master's) program; or permission of BMGT-Robert H. Smith School of Business.
Credit only granted for: BUFN721 or BUFN770.
Formerly: BUFN770.
Addresses international stock markets, portfolio theory, international interest rates, exchange rates and exchange rate derivatives (options, forwards, and futures), exchange rate swaps and exchange rate exposure (operating, translation, and transaction), foreign investment strategy.
BUFN734
Portfolio Management
Credits: 2
Prerequisite: BUFN610.
Restriction: Permission of BMGT-Robert H. Smith School of Business; or must be in Business and Management (Master's) program.
Credit only granted for: BUFN734 or BUFN763.
Formerly: BUFN763.
Provides training that is important in understanding the investment process - the buy side of the financial world. Specifically, the objective is to provide graduate-level instruction in the following topics, both in theory and in using financial markets data to test the basic theory and practice of portfolio choice and equilibrium pricing models and their implications for efficient portfolios.
BUFN736
Quantitative Investment Strategies
Credits: 2
Prerequisite: BUFN610.
Restriction: Must be in a major in BMGT-Robert H. Smith School of Business; or must be in Business and Management (Master's) program.
Credit only granted for: BUFN764 or BUFN736.
Formerly: BUFN764.
Provides an introduction to quantitative techniques of selecting equities, as used commonly among long-short equity hedge funds and other quantitative equity asset management companies. Statistical factor models are developed to locate stocks with higher expected returns, based on the observable characteristics of the stocks. Implementation issues, including statistical estimation, backtesting and portfolio construction, are covered, as is performance evaluation.
BUFN741
Credits: 2
Prerequisite: BUFN620; or permission of BMGT-Robert H. Smith School of Business.
Restriction: Must be in Business and Management (Master's) program; or permission of BMGT-Robert H. Smith School of Business.
Credit only granted for: BUFN758P or BUFN741.
Formerly: BUFN758P.
This course covers modern theories and techniques for investments and asset pricing. The main topics covered are: portfolio theory, pricing models, market efficiency, fixed income investment, forwards and futures, and options.
For Master of Quantitative Finance students only.
BUFN742
Financial Engineering
Credits: 2
Prerequisite: BUFN610.
Restriction: Permission of BMGT-Robert H.
Credit only granted for: BUFN742 or BUFN766.
Formerly: BUFN766.
Introduces and applies various computational techniques useful in the management of equity and fixed income portfolios and the valuation of financial derivatives and fixed income securities. Techniques include Monte Carlo Simulation and binomial/lattice pricing models. Emphasis is on bridging theory with the design of algorithms and models that can be directly applied in practice.
BUFN746
Enterprise and Credit Risk Management
Credits: 2
Prerequisite: BUSI640; and BUFN740.
Restriction: Must be in Business and Management (Master's) program; or permission of BMGT-Robert H. Smith School of Business.
Surveys the theory and practice of credit risk identification, measurement and mitigation along with understanding the principles of enterprise risk governance and risk-adjusted returns. The course examines how to develop credit loss distributions via Monte Carlo simulation or copula methodologies for consumer assets such as mortgages, credit cards and auto loans, developing commercial loan scorecards for rating credit risk. Pricing and use of various credit structures such as credit default swaps, collateralized debt obligations and credit-linked notes is examined.
BUFN747
Asset-Liability and Nonfinancial Risk Management
Credits: 2
Prerequisite: BUSI640; and BUFN740.
Restriction: Must be in Business and Management (Master's) program; or permission of BMGT-Robert H. Smith School of Business.
This course surveys risks and techniques associated with asset-liability and nonfinancial risks including market and interest rate risk, liquidity risk, operational risk and model risk, among others. Techniques such as portfolio value-at-risk (VaR) are used in realistic empirical examples to illustrate the methods. Key rate duration, principal components analysis and analytical and simulation-based VaR techniques are used to estimate interest rate risk exposure for financial firms. Hedging these risks using various financial derivative products such as options, swaps and futures contracts is explored. Operational risk is estimated leveraging Poisson loss distributions and model risk and validation techniques are reviewed.
BUFN758D
Special Topics in Finance; big data in finance
Credits: 2