Financial Economics

In this course we will study financial markets, asset pricing, and derivative securities. We will emphasize how investors value risk, how prices aggregate information, and how futures, options, and other derivatives are used for hedging, speculation, and risk management. Topics include risk and return, portfolio choice, CAPM and factor models, market efficiency, forwards and futures, options, binomial and Black-Scholes pricing, volatility, and financial crises. Students will combine economic models, real market data, and case studies to evaluate financial decisions and market outcomes. (ECON 0111 and ECON 0250)