International Finance

Aims of the course

no description

Course syllabus

Part 1

1. Conceptual framework for analysing international finance (3 hours)
• Balance of payments account and analysis
• Exchange rates and exchange rate policies
Case studies:
- Current account sustainability of an emerging economy

2. Financial crises in emerging economies and “new financial architecture” (3 hours)
• International financial system
• Definition and classification of financial crises
• Reasons for crises and solutions of financial crises
• Key elements of a “new financial architecture”
Case study:
- Argentina

3. Country risk and risk analysis by rating agencies (3 hours)
• Concept and analytical framework for measuring country risk and risk of other bond issuers
• Credit rating agencies and their importance
Case study:
- Country risk analysis of a country

4. International capital flows (6 hours)
• International capital flows and macroeconomic aggregates
• Classification, volume and structure of international capital flows
• Liberalization of international capital flows
• Main patterns of financial inflows into emerging economies
• Official flows – credits and grants
• Private debt flows through eurofinancial market – syndicated bank loans and Eurobonds
• Private equity flows – direct foreign investment and portfolio equity investment)
Case study:
- Transition countries

Part 2

1. Foreign Exchange Markets (6 hours)
• Terminology and basic calculations
• International parity relationships
Case studies:
- Waterside Furniture

2. International Valuation (3 hours)
• Fundamentals of international capital budgeting
• Using parity relationships to make exchange rate forecasts
Case studies:
- MSDI Alcala de Henares, Spain
- Ocean Drilling
- Hintz, Kessels, Kohl A.G.

3. Foreign Exchange Risk Management (9 hours)
• Background of foreign exchange risks and hedging
• Use of foreign exchange derivatives markets
• Use of swaps markets
• Evaluation of risk management alternatives

Case studies:
- Tiffany & Company (1993)
- Canphone Systems Inc.
- The Walt Disney Company’s Yen Financing
- R.J. Reynolds International Financing
- Universal Circuits Inc.

Course director(s)