BABSON COLLEGE

FIN 3560

Spring 2008

Financial Markets and Instruments

1. Course Description
2. Required Texts      
3. Prerequisites  
4. Course Work and Grades

Course Description
 

This course is for those students who are interested in learning more about financial markets, instruments, and institutions.  We will examine a myriad of financial markets, the instruments that trade on them, and the financial and governmental institutions that use or support these markets.  In particular, we will cover interest rates, equity markets,  the money, capital and mortgage markets, the foreign exchange market, the Federal Reserve, and some derivative markets.  To provide a unifying theme and to demonstrate the interconnectivity of the financial system, we will relate each chapter to the workings of the securities markets through The Wall Street Journal throughout the course.

Required Texts

Financial Markets and Institutions :  A Modern Perspective (3rd Edition), by Anthony Saunders and Marcia Million Cornett, Irwin/McGraw-Hill, copyright 2007

Obscene Gestures of an Invisible Hand: Financial Doom and the Death of Culture – The Lighter Side, by Jeffrey J. Trester, copyright 2004

The Wall Street Journal    Required reading EVERY DAY.  (I am not kidding about this!)

You are expected to keep up with the readings at ALL times!  Failure to do so will not only be costly but will force me to read from the book (since you are not reading it yourself).  This will no doubt be boring for everyone, so please keep up with the reading.  If you keep up with the reading, we can then go beyond the text and get into some very interesting discussions and topics.

Prerequisites

All of the normal Finance Department Prerequisites apply.  See your Class Dean for more details.

Course Work and Grades

Finance is not an easy subject, and this is not an easy class.  You will need to think, study, practice the problems at the end of the chapters, and be prepared for class to do well in this course.  On the other hand, if you are willing to put in some time and effort, you should find the class quite rewarding.

There will be two midterms and a final.  The second midterm will be a group term paper on a selected topic.  In addition, there will also be homework for you to do on your own.  Thus, no one score will determine your overall grade in the class.  All class members are expected to participate actively in the class.

The initial calculation for the course grade will use the weights below, although outstanding good (or bad) class participation may, at my option, be recognized by an increase (decrease) of a half grade or more, at my sole discretion:

Participation, Initiative, Professionalism, and Improvement (PIPI)                                                          15%

                    Midterm 1                                                                                                                                            25%

                                Midterm 2 (Group Paper)                                                                                                                    25%

                                Final                                                                                                                                                    35%

All work and exams are cumulative.  If an emergency or illness should force you to miss an examination or assignment/homework deadline, you must contact me before the test is given or the assignment is due.