The course introduces students to the conceptual framework in which financial decision making of international firms takes place. Students will learn to assess the riskiness of a currency from a firm's perspective and how to manage this exposure. In addition to the theoretical underpinnings of international finance we will cover the practical side of international financial decision making - the investment and funding problem. Thus, typical problems of global funding and international investment strategies as well as capital budgeting and capital structure issues will be analyzed from an international perspective. The course provides a basic understanding of international financial markets and institutions and aims particularly on international risk assessment (currency risk, political risk) and management.
Knowledge and understanding
After completing this course, the student will have
- Gained insights into the financial risks and opportunities of a multinational company
- Learned how to assess and manage financial risks
- Familiarity with typical international financial instruments
- An understanding of the application of these instruments in a global context
Cognitive and subject specific skills
Students on completion of the course will have
- The understanding how current international monetary systems function
- The ability to apply tools for measurement and management of currency risks
- The knowhow to make use of financial instruments available for internationally operating firms: equity instruments, debt instruments and derivatives
- The skills for investment-decision making in an international context
- The ability to conduct a financial analysis
- The ability to analyze situations dealing with problems of international firms