FINANCIAL RISK MANAGEMENT - 2020/1
Module code: MAN3097
Financial risk management focuses on the types of risk that arise for a business including; market risk, credit risk and interest risk. This module considers financial risk management strategies; how risk is evaluated; the methods that are available to hedge against risk and the strategies that are employed to mitigate risk. This is complemented by consideration of key risk management issues for financial institutions including regulatory issues such as Basel III. Risk Management is a key element in an Accounting and Finance programme.
Surrey Business School
KLINGBERG INSOLL Monica (SBS)
Number of Credits: 15
ECTS Credits: 7.5
Framework: FHEQ Level 6
JACs code: N341
Module cap (Maximum number of students): N/A
Prerequisites / Co-requisites
Students must have completed Financial Management (MAN3080)
Indicative content includes:
- Introduction to Risk Management
- Trading in Financial Markets
- Interest Rate Risk
- Credit Risk
- Liquidity Risk
- Market Risk
- Hedging Strategies with Derivatives
- Risk & Regulation: Basel III
- The 2007-2008 Financial Crisis
|Assessment type||Unit of assessment||Weighting|
|School-timetabled exam/test||1 HOUR MID-TERM TEST (CLOSED BOOK)||30|
|Examination||2 HOUR FINAL EXAM (CLOSED BOOK)||70|
The assessment strategy is designed to provide students with the opportunity to demonstrate both understanding of theoretical concepts and their practical application.
- Appraise and quantify potential financial risks including market risk, credit risk, liquidity risk and interest rate risk.
- Analyse and select the appropriate risk management or hedging instrument to mitigate this risk.
- Critically analyse the cost and risk of using financial instruments to perform risk management or risk adjustment
- Outline and critically appraise key issues such as Basel III or the Financial Crisis 2007-8
Thus, the summative assessment for this module consists of:
- A one-hour mid-term test (30%).
- A two-hour closed book exam (70%).
Formative assessment and feedback
Formative feedback will be given in a continuous manner throughout the course of the module. The weekly tutorial sessions and office hours will be used to provide individual formative feedback. Students also have the opportunity to sit a mock mid-term test and mock eam to gain a greater insight into progress and areas requiring further study.
Formative and summative feedback on the mid-term test will be given following the test. This will enable the students to assess their learning at that stage and to further prepare for the final exam.
- The aim of the module is to increase awareness of the risks that businesses face in terms of the financial transactions they undertake and how businesses evaluate and try to deal with risk. The module provides students with an insight into the reasons financial risk management is undertaken and the strategies that can be employed to reduce risk.
|1||Identify and appraise potential financial risks in terms of market risk, credit risk, liquidity risk and interest rate risk.||KC|
|2||Analyse and select the appropriate risk management or hedging instrument to mitigate this risk.||KPT|
|3||Understand the market conventions which apply to those instruments.||K|
|4||Critically analyse the cost and risk of using financial instruments.||CT|
|5||Understand key regulatory issues such as Basel III and evaluate their role in risk management and their impact on management decisions||KC|
C - Cognitive/analytical
K - Subject knowledge
T - Transferable skills
P - Professional/Practical skills
Overall student workload
Independent Study Hours: 117
Lecture Hours: 22
Tutorial Hours: 11
Methods of Teaching / Learning
The learning and teaching strategy is designed to allow a student to come to grips with what is essentially a subject of mixed theory and practice and in so doing develop a mixture of academic and industry knowledge, numerical problem solving skills and enhance analytical and decision taking powers. This is in line with the programme’s learning and teaching strategy which develops academic and practitioner skills.
The learning and teaching methods include:
- Eleven weekly two-hour lecture incorporating class-room participation for better understanding.
- Eleven weekly one hour tutorials for solving problems to understand key concepts covered in lectures. Tutorials include worked examples which are an integral part of the module. Due to the quantitative nature of the module it is important that participants regularly solve set problems and consult available solution sets. Tutors will provide the necessary support during these sessions for deeper understanding of key issues.
- SurreyLearn discussion forums to address any issues related to the content, learning and teaching environment, and delivery of the module and/or specific topics.
- Utilizing SurreyLearn as the main pool of resources including lecture handouts, seminar problems, mock exercises, and discussions. Using SurreyLearn as the main means of communication establishes resource efficiency, communicational effectiveness and visibility for all students.
- Weekly office hours provided by tutors.
- Support of lecture material by directed reading in selected textbooks and journal articles.
Indicated Lecture Hours (which may also include seminars, tutorials, workshops and other contact time) are approximate and may include in-class tests where one or more of these are an assessment on the module. In-class tests are scheduled/organised separately to taught content and will be published on to student personal timetables, where they apply to taken modules, as soon as they are finalised by central administration. This will usually be after the initial publication of the teaching timetable for the relevant semester.
Reading list for FINANCIAL RISK MANAGEMENT : http://aspire.surrey.ac.uk/modules/man3097
Programmes this module appears in
|Accounting and Finance BSc (Hons)||2||Compulsory||A weighted aggregate mark of 40% is required to pass the module|
Please note that the information detailed within this record is accurate at the time of publishing and may be subject to change. This record contains information for the most up to date version of the programme / module for the 2020/1 academic year.