Security Analysis and Portfolio Management syllabus

Security Analysis and Portfolio Management

• 1 Introduction (4 LHs)

  • Investment meaning and process
  • Real and financial assets; types of financial assets
  • Financial intermediaries, markets and participants
• 2 Securities Markets (8 LHs)

  • Securities market types and trading mechanisms
  • Orders, costs, buying on margin and short sales
  • Price-, value- and equal-weighted stock indexes
  • Nepal Stock Exchange and Securities Board roles
• 3 Risk and Return (6 LHs)

  • Holding-period, multiple-period, annualized and expected returns
  • Inflation and real rates of return
  • Variance, standard deviation and coefficient of variation
  • Risk and return of portfolios with risky and risk-free assets
• 4 Efficient Diversification and CAPM (7 LHs)

  • Diversification, covariance and correlation
  • Two-risky-asset allocation and risk-return trade-off
  • Mean-variance criterion and efficient frontier
  • Optimal risky portfolio and risk-free asset
  • CAPM assumptions, implications and security market line
• 5 Fixed Income Securities (5 LHs)

  • Types of fixed-income securities
  • Bond pricing, yields and duration
• 6 Common Stock Valuation (6 LHs)

  • Intrinsic value versus market price
  • Constant-growth and multistage dividend-discount models
  • Price-earnings ratios
• 7 Macroeconomic and Industry Analysis (5 LHs)

  • Domestic macroeconomy and fiscal/monetary policy
  • Business cycles and economic indicators
  • Industry sensitivity, sector rotation, lifecycle, structure and performance
• 8 Behaviroul Finance and Technical Analysis (7 LHs)

  • Behavioural finance concept
  • Technical analysis assumptions versus fundamental analysis
  • Contrary-opinion, smart-money, momentum, price and volume indicators