Course syllabus

Finansiell ekonomi, avancerad kurs
Financial Economics, Advanced Course

EXTQ25, 7,5 credits, A (Second Cycle)

Valid for: 2020/21
Decided by: PLED I
Date of Decision: 2020-04-03

General Information

Elective for: F5, I4-fir, Pi5-fm
Language of instruction: The course will be given in English


The objective of this course is to give the students an understanding of well known ideas and theories within financial economics.

Learning outcomes

Knowledge and understanding
For a passing grade the student must

Competences and skills
For a passing grade the student must

Students shall have the ability to independently apply their knowledge to real world problems. In particular they shall be able to:
•calculate the risk premium, the certainty equivalent, absolute and relative risk aversion, prudence and temperance,
•calculate state prices,
•apply CAPM in equilibrium pricing,
•price derivatives,
•price real options,
•analyse finance-related problems in the real-world and to incorporate adequate methods and theories to analyse these problems,
•present a clear and pedagogical report of their own and others' empirical analyses.

Judgement and approach
For a passing grade the student must

Students shall have developed
•the ability to pursue further studies in finance and economics,
•the ability to independently search for and evaluate information from literature within finance,


The course contains the following building blocks
•investment decision under certainty: the risk free rate and Fisher-separability;
•risk aversion and expected utility;
•Arrow-Debreu securities;
•portfolio theory
•market equilibrium: CAPM and multi-factor equilibrium models;
•term structure of the interest rates;
•real options;
•efficient markets;
•information asymmetry and agent theory.

Examination details

Grading scale: TH - (U,3,4,5) - (Fail, Three, Four, Five)
Assessment: Students are evaluated in a written exam. In addition, quick quizes during the course give points that are added to the score on the exam. Points from quick quizes are only added to the score on the exam during the same term as the quick quizes were carried out.

The examiner, in consultation with Disability Support Services, may deviate from the regular form of examination in order to provide a permanently disabled student with a form of examination equivalent to that of a student without a disability.


Admission requirements:

The number of participants is limited to: 60
Selection: Completed university credits within the programme. Priority is given to students enrolled on programmes that include the course in their curriculum.
The course overlaps following course/s: TEK103, NEKM25, NEKN81

Reading list

Contact and other information

Course coordinator: Frederik Lundtofte,
Course homepage:
Further information: Corresponds to NEKN81.