Overview

This unit teaches students to analyse fixed income markets, securities and develop portfolio management strategies. Students will learn techniques to value a variety of fixed income securities and analyse risk and performance. Additionally, students will develop an understanding of interest rate, credit risks, valuing bonds with options and structured investment strategies. The ethical issues surrounding investing in distressed securities and managing returns and risk in fixed income portfolios will be discussed. Financial technology will be used to evaluate the performance of fixed income portfolios.

Requisites

Prerequisites
FIN60003 Business Modelling and Analysis

Rule
FIN60003 Business Modelling And Analysis
AND
50 Credit Points

Teaching periods
Location
Start and end dates
Last self-enrolment date
Census date
Last withdraw without fail date
Results released date
Semester 2
Location
Hawthorn
Start and end dates
29-July-2024
27-October-2024
Last self-enrolment date
11-August-2024
Census date
31-August-2024
Last withdraw without fail date
13-September-2024
Results released date
03-December-2024
Semester 2
Location
Hawthorn
Start and end dates
04-August-2025
02-November-2025
Last self-enrolment date
17-August-2025
Census date
31-August-2025
Last withdraw without fail date
19-September-2025
Results released date
09-December-2025

Learning outcomes

Students who successfully complete this unit will be able to:

  • Critically analyse the characteristics of fixed income securities, markets, and valuation techniques.
  • Apply advanced knowledge and quantitative skills in risk analysis and valuation of fixed income portfolios.
  • Demonstrate advanced knowledge of the term structure of interest rates and evaluate the trading behaviour of market participants.
  • Critically reflect on technological issues relating to fixed income portfolio formation and investment decision-making process.
  • Work collaboratively in groups

Teaching methods

Hawthorn

Type Hours per week Number of weeks Total (number of hours)
On-campus
Class
2.00 12 weeks 24
Online
Lecture
1.00 12 weeks 12
Unspecified Activities
Various
9.50 12 weeks 114
TOTAL150

Assessment

Type Task Weighting ULO's
AssessmentIndividual 30 - 50% 1,2,3 
AssignmentGroup 40 - 50% 1,2,3,4,5 
Online QuizzesIndividual 10 - 20% 1,2,3 

Content

  • Types of fixed income securities and their characteristics
  • Fixed income markets
  • Fixed income valuation and return analysis
  • Fixed income portfolio benchmarks
  • Term structure determination and yield spreads
  • Interest rate risk and Credit risk analysis
  • Valuing bonds and embedded options
  • Structured products
  • Fixed income portfolio management strategies
  • Distressed securities and Bankruptcies
  • Ethics in investing in fixed income securities

Study resources

Reading materials

A list of reading materials and/or required textbooks will be available in the Unit Outline on Canvas.