Accounting and Finance

Financial Risk Management

Module code: N1569
Level 6
15 credits in autumn semester
Teaching method: Workshop, Lecture
Assessment modes: Coursework, Project

This module introduces the risks faced by all types of companies and financial institutions involved with the financial markets. It analyses credit risk in some detail, but the focus is on market risk analysis, using Excel spreadsheets and GenAI tools to enhance learning.

Learning is enhanced using a set of interactive Excel workbooks providing practical tools for market risk assessment and mitigation for different types of financial assets and instruments, including fixed income products, international equities and options.

 

Module learning outcomes

• Identify and compare different sources of financial risks, and understand how to distinguish between systematic (non-diversifiable) and idiosyncratic (diversifiable) risks
• Recognize the major characteristics of derivative instruments and understand how to balance an options book so that it is delta-gamma-vega neutral.
• Critically assess the application of regulatory and economic capital to financial risk management policies and use Excel to test the performance of models used for assessing this capital.
• Effectively use Gen AI tools to implement models for measuring the market risk of portfolios of equities, interest-rate-sensitive products, commodities, futures and options.