Finance Department MBA Course Descriptions
Spring 2010 and Fall 2010 Semesters
PLEASE NOTE THAT TO TAKE PARRINO’s or TITMAN’s FINANCIAL STRATEGIES COURSE IN FALL 2010 WILL REQUIRE THAT YOU HAVE TAKEN FIN 394.1 ADVANCED CORPORATE STRATEGIES THIS SPRING.
More information on these courses can be found on the Finance Department web page: http://www.mccombs.utexas.edu/dept/finance/courses/ which contains syllabi for most of the courses from
previous semesters.
FIN 286 - Valuation
Will be taught in Spring and Fall
Spring faculty: Greg Hallman and Cesare Fracassi
This course builds on the concepts and tools introduced in BA285T by introducing students to
valuation of enterprises and the various claims against enterprise cash flows. Topics covered
include cost, market, and income approaches to valuation and their application to enterprise, debt,
equity, and option valuation. The course combines lectures with cases to provide the students with
a solid understanding of key financial theories as they relate to valuation and their application.
FIN 394.1 - Advanced Topics in Corporate Finance
To be offered in Fall and Spring
Spring faculty: Aydogan Alti and Jonathan Cohn
Description: This course continues and extends the discussion of the basic corporate financial
management decision-making process begun in BA 385T and continued in FIN 286. Topics
covered in the course will include: an overview of financial management in the global marketplace;
comparisons of financial and real investments; valuing real assets and real options; the role of
financial leverage; optimal capital structure; bondholder-stockholder conflicts; stockholder-owner
conflicts; evaluating financial distress; optimal debt management; managerial incentives and
compensation arrangements; value-based management and information management; corporate
control and restructuring: mergers, acquisitions, takeovers, spinoffs and selloffs; corporate
governance issues; and the role of institutional activism. Prerequisites: BA 385T
FIN 397.1 - Investment Theory and Practice
To be offered in Fall and Spring
Spring faculty: Shimon Kogan
Description: This course focuses on the examination and valuation of the major investment vehicles
popular today throughout the world. Topics covered will include: an overview of the investment
decision-making process; asset allocation in the global investment setting; analysis of security types;
analysis of security markets and trading practices; aggregate market analysis and market indicators;
risk, diversification, and optimal portfolio formation; risk and expected return: CAPM, APT, and
factor models; domestic and international fixed-income investing: instruments, valuation, and
strategies; domestic and international equity investing: instruments, valuation, and strategies; forward
and futures contracts: valuation and strategies; option contracts: valuation and strategies; investment
companies; and performance measurement. Prerequisites: BA 385T
FIN 394.14 - Venture Capital Fellows Program
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To be offered in Fall and Spring – will be led by Jim Nolen
Course is restricted to Students in the Program
FIN 394.15 - Energy Finance Practicum
To be offered in Spring 2010– will be taught by Ehud Ronn
FIN 394.2 - Financial Strategies
NOTE: Because of the different focuses for this course (business investment and financing
decisions, energy finance, mergers and acquisitions), credit will be given if the course is taken
with different focuses.
General description: This course develops an integrated, in-depth analysis of the interaction
between the operating policies of a corporation and its financial decision-making strategies.
Topics covered in the course will include: the tools of financial decision-making; corporate cash
management; cost of capital evaluation; project analysis and valuation; the financial impact of
marketing strategies; public and private company valuation; corporate acquisition policies;
financing the required asset base; dividend policy; capital structure: internal versus external
financing; assessing and managing investor clienteles; and assessing and managing business risk
exposures. Prerequisites: BA 385T, FIN 394.1, FIN 397.1
Focus on private equity - to be offered in Fall 2010 - will be taught by Robert Parrino
FIN 394.1 (Private Equity) provides students with an understanding of the nature of the private
equity market, the principal participants in this market, and the financial strategies that they
employ. Topics covered include: How private equity funds are raised, structured, and financed;
contracting in private equity markets; valuation of private equity interests; sources of capital for
private companies; strategies for value creation; mergers and acquisitions, and exit strategies. The
course is taught through a combination of lectures, cases, and guest speakers.
Focus on energy finance - to be offered in Fall 2010 - will be team-taught by Sheridan Titman and John Butler.
This course is primarily focused on the initiation, evaluation, financing and hedging of major
corporate investments with a focus on the energy industry. The theory behind these decisions will
be featured but practical issues involving application of the concepts will be emphasized,
including scenario analysis and simulation. Topics include examining the risks, financing,
financial statement effects, flexibility, and strategic considerations of the investment. The course is
taught through a combination of lectures, cases, and guest speakers.
FIN 394.3 - Global Finance
To be offered in Spring 2010 - will be team-taught by John Griffin and Stephen Magee
Description: This course provides students with an in-depth look at the financial management
function in a multinational corporation. The following topics will be covered: an overview of
global capital and equity markets; an analysis of the balance of payments; the creation of
international money and the determination of foreign exchange rates; the mechanics of currency
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trading; interest rate and purchasing power parity relationships; managing foreign exchange risk;
analyzing foreign direct investment; capital budgeting in a global environment; taxes, transfer
prices, and intracompany loans; assessing and measuring political risk; and financial issues in
emerging markets. Prerequisites: BA 385T, FIN 394.1, FIN 397.1
Fin 394.4 - Financial Management of the Small Firm
To be offered in Fall and Spring – will be taught by Jim Nolen ndThis course is restricted to 2 year students.
Description: A corporate finance class focused on the financial issues of privately held
companies. Topics include financial statement analysis, business valuation, financial forecasting,
sources of capital, working capital management, financial leverage, value creation and exit strategies.
This course is part of the entrepreneurship curriculum and combines the previously separate topics of
small business finance and entrepreneurial harvest. This class is case-based where a significant part of
the student’s grade is based on class discussion. The midterm and final exams consist of a written
case analysis. In lieu of the case-based final exam, students will be offered an option to form small
teams and find a privately-held company willing to allow the team to perform a financial analysis and
business valuation of the company. The team deliverable will be a substantial written analysis at the
end of the semester that includes an industry/competitor analysis, SWOT analysis, financial analysis,
pro forma financial statements and a business valuation. The final written report will be presented to
the business owners/directors. Prerequisites: BA 385T
FIN 397.4 - Financial Risk Management
Focus on energy finance – to be offered in Fall – will be taught by Ehud Ronn
General Focus – to be offered in Spring – will be taught by Jennifer Juergens
Description: This course focuses on how corporations manage their myriad business risk exposures
and which of these exposures derivative securities are designed to address. The following topics will
be covered: an overview of capital and derivative markets and the participants in those markets; the
risk management process; measuring corporate risk exposure: gap analysis, value at risk, and stress
testing; comparison of forward, futures, insurance, and option markets; theory of hedging, speculation
and arbitrage; commodity, interest rate, stock index, and foreign exchange futures contracts: valuation
and strategies; option valuation: binomial, Black-Scholes, exotic; commodity, interest rate, stock
index, and foreign exchange option contracts: strategies and applications; and swap contracting.
NOTE: This course is taught with a generalist focus or with a focus on energy finance issues.
Because both classes have about a 70% overlap in material, they cannot both be taken.
Prerequisites: BA 385T, FIN 394.1, FIN 397.1
FIN 397.5 - Fixed Income Analysis
To be offered in Spring 2010
Description: This course provides a comprehensive analysis and valuation of fixed-income securities
from the perspective of a financial, security, or credit analyst. Topics covered in the course will
include: an overview of Treasury, agency, and corporate fixed-income securities; trading conventions
and practices in fixed-income markets, general approaches to valuing debt securities; theories and
models of the term structure of interest rates; par, spot, and forward yields; an analysis and valuation
of credit risk; fixed- and variable-income debt securities; asset-backed securities and structured notes;
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fixed-income derivatives: valuation and applications; and fixed-income portfolio management
strategies. Prerequisites: BA 385T, FIN 394.1, FIN 397.1
FIN 397.6 - Special Topics in Investments
Focus on hedge fund strategies - to be offered in Spring 2010 - will be taught by Roberto Wessels
Description: The course will cover different operational aspects of investment vehicles commonly
known as Hedge Funds. The emphasis will be on understanding investment strategies, performance
analysis, compensation and risk management practices of hedge funds.
Focus on REIT Fund - to be offered in Fall - will be taught by Sheridan Titman
to be offered in Spring - will be taught by Greg Hallman
Course is restricted to REIT Fund Students
Focus on MBA Fund - to be offered in Fall - will be taught by Sandy Leeds
Course is restricted to MBA Fund Students Prerequisites: BA 385T, FIN 394.1, FIN 397.1
RE 386.2 - Real Estate Investment Decisions
To be offered in Spring 2010 - will be taught by Jay Hartzell
Description: This course examines selected advanced problems and issues in the area of real estate
investment. Topics include: discounted cash flow analysis, risk, sensitivity analysis, taxation, form of
ownership, syndications/limited partnerships, the role of institutional investors, property management,
and marketing investment property. Financial concepts and models are applied to real estate analysis
so the student can take away an understanding of the real estate investment market.
Prerequisites: BA 385T
RE 386.3 - Seminar in Real Estate Analysis
To be offered in Fall 2010
Description: This will be a real estate practicum course Prerequisites: BA 385T, RE 386.2
RE 388 - Seminar in Real Estate Finance
To be offered in Spring 2010
Description: This course examines equity ownership/investment in real estate in both private and
public market settings as well as the debt financing of residential and commercial properties. Topics
include asset allocation and diversification, project vs. entity level valuation analysis, including a
comparison of REITS, private equity funds, and direct real property investments and their
underwriting and valuation criteria, land and development option valuation, other equity investment
issues; comparison and contrast of financial theory and real world application of financial concepts
and evaluation methods; primary and secondary mortgage markets, mortgage banking, loan
instruments, mortgage securitization, as well as lenders and borrowers decisions regarding real estate
financing. Prerequisites: BA 385T, RE 386.2, FIN 397.1
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