This document provides information on an International Finance course module, including:
- The instructor's contact information, course details, and an overview of the importance of international finance.
- Course objectives, distribution of marks, and 4 assignments focused on analyzing currency and foreign investment trends.
- 2 activities for students to discuss currencies and international stock exchanges.
- An outline of 22 planned lectures, their topics, and how they relate to the assignments. Key topics include foreign exchange markets, exposure, international trade/payments, monetary systems, and institutions.
- The goal is to equip students with international financial practices and provide insights into foreign exchange, markets, and hedging techniques used in global business.
The document provides an overview of the legal framework for growing international finance in India. It discusses several key acts and policies:
- The Foreign Exchange Regulation Act (FERA) of 1973 which imposed strict exchange controls was replaced by the Foreign Exchange Management Act (FEMA) of 1999 to liberalize controls.
- FEMA recognizes the distinction between current and capital account transactions and seeks to facilitate external trade and payments.
- The Prevention of Money Laundering Act (PMLA) of 2002 defines money laundering and outlines penalties. It established the Financial Intelligence Unit - India to analyze suspicious financial transactions.
- Other policies discussed include the Foreign Investment Promotion Board (FIPB), American/Global Depositary
The document provides an overview of the evolution of international monetary systems from bimetallism to the modern system. It discusses how bimetallism used both gold and silver standards until the late 1800s, but countries eventually moved to single gold or silver standards. It then explains how the Bretton Woods system established the US dollar as the dominant currency pegged to gold in the mid-1900s. Growing US deficits and inflation led to the system's collapse in the 1970s. The current system involves floating exchange rates between most currencies and the IMF helps oversee global currency stability.
Introduction to international finance and International economyAparrajithaAriyadasa
International economics is a field of study that assesses the implications of international trade, international investment, and international borrowing and lending.
There are two broad sub-fields within the discipline: international trade and international finance
This document is a presentation on international finance that was given by Dr. Mital Bhayani. The presentation defines international finance as monetary transactions between two or more countries. It outlines the learning objectives, which are to explain the meaning of international finance, appreciate its importance and goals, describe its nature, compare it to domestic finance, and outline its scope. The presentation then covers the meaning, importance, nature, scope of international finance and how a country's economic wellbeing relates to globalization. It discusses key aspects like exchange rates, foreign exchange risk, political risk, and market imperfections.
The document provides an introduction to international financial systems and globalization. It discusses reasons for understanding international financial systems, including the increase in global trade and opportunities. It then defines globalization as the shrinking of time and space between countries and the integration of global production and exchange. The document goes on to discuss various effects of globalization, including the emergence of global markets, changes to world trade and foreign direct investment, and technological effects. It also outlines some challenges of and strategies for adapting to globalization.
This document discusses international flows of funds and balance of payments. It explains that the balance of payments records all transactions between domestic and foreign entities over a period of time. It is made up of a current account, capital account, and financial account. The current account covers trade in goods and services as well as income flows. A country's balance of payments can be influenced by economic factors like exchange rates, inflation, national income, and government policies. It also discusses how trade imbalances can be corrected and describes several international organizations that facilitate global capital flows and trade.
The document discusses India's balance of payments. It includes:
1. The current account which covers merchandise (exports and imports) and invisibles (services, transfers, investment income).
2. The capital account which includes foreign investment, loans, banking capital, and other capital flows.
3. Errors and omissions and the overall balance which is the sum of the current account, capital account and errors/omissions.
Discuss the difference between international finance and domestic finance. Explain the most traded currencies in the world and the reason of their popularity
The document provides an overview of the legal framework for growing international finance in India. It discusses several key acts and policies:
- The Foreign Exchange Regulation Act (FERA) of 1973 which imposed strict exchange controls was replaced by the Foreign Exchange Management Act (FEMA) of 1999 to liberalize controls.
- FEMA recognizes the distinction between current and capital account transactions and seeks to facilitate external trade and payments.
- The Prevention of Money Laundering Act (PMLA) of 2002 defines money laundering and outlines penalties. It established the Financial Intelligence Unit - India to analyze suspicious financial transactions.
- Other policies discussed include the Foreign Investment Promotion Board (FIPB), American/Global Depositary
The document provides an overview of the evolution of international monetary systems from bimetallism to the modern system. It discusses how bimetallism used both gold and silver standards until the late 1800s, but countries eventually moved to single gold or silver standards. It then explains how the Bretton Woods system established the US dollar as the dominant currency pegged to gold in the mid-1900s. Growing US deficits and inflation led to the system's collapse in the 1970s. The current system involves floating exchange rates between most currencies and the IMF helps oversee global currency stability.
Introduction to international finance and International economyAparrajithaAriyadasa
International economics is a field of study that assesses the implications of international trade, international investment, and international borrowing and lending.
There are two broad sub-fields within the discipline: international trade and international finance
This document is a presentation on international finance that was given by Dr. Mital Bhayani. The presentation defines international finance as monetary transactions between two or more countries. It outlines the learning objectives, which are to explain the meaning of international finance, appreciate its importance and goals, describe its nature, compare it to domestic finance, and outline its scope. The presentation then covers the meaning, importance, nature, scope of international finance and how a country's economic wellbeing relates to globalization. It discusses key aspects like exchange rates, foreign exchange risk, political risk, and market imperfections.
The document provides an introduction to international financial systems and globalization. It discusses reasons for understanding international financial systems, including the increase in global trade and opportunities. It then defines globalization as the shrinking of time and space between countries and the integration of global production and exchange. The document goes on to discuss various effects of globalization, including the emergence of global markets, changes to world trade and foreign direct investment, and technological effects. It also outlines some challenges of and strategies for adapting to globalization.
This document discusses international flows of funds and balance of payments. It explains that the balance of payments records all transactions between domestic and foreign entities over a period of time. It is made up of a current account, capital account, and financial account. The current account covers trade in goods and services as well as income flows. A country's balance of payments can be influenced by economic factors like exchange rates, inflation, national income, and government policies. It also discusses how trade imbalances can be corrected and describes several international organizations that facilitate global capital flows and trade.
The document discusses India's balance of payments. It includes:
1. The current account which covers merchandise (exports and imports) and invisibles (services, transfers, investment income).
2. The capital account which includes foreign investment, loans, banking capital, and other capital flows.
3. Errors and omissions and the overall balance which is the sum of the current account, capital account and errors/omissions.
Discuss the difference between international finance and domestic finance. Explain the most traded currencies in the world and the reason of their popularity
This document discusses international finance, including the balance of payments, International Monetary Fund, and foreign exchange markets. It defines balance of payments as the record of all transactions between a country's residents and the rest of the world, including the current account, capital account, and reserves. The International Monetary Fund was created in 1945 to assist in reconstructing the international payment system after World War II and works to improve member economies. Foreign exchange markets allow currencies to be traded globally and determine relative currency values.
This document provides an overview of international financial management. It discusses key topics like the balance of payments, determinants of entry modes for international business like exports and counter trade, differences between international and domestic finance, events that increased global trade volumes, and trade agreements. International flow of funds is examined, specifically India's balance of trade. Outsourcing is also discussed as having impacted international trade through increased cross-border purchasing.
International financial management deals with planning and managing financial operations of international activities of an organization. It includes managing foreign exchange risks, international taxation, financing decisions, investments in international financial markets, and accounting differences between nations. The key functions are performed by the treasurer, who manages cash and secures financing, and the controller, who handles accounting activities. The scope of international financial management encompasses balance of payments, international institutions like the IMF and World Bank, and financial markets like foreign exchange markets.
This document provides an overview of international capital movements. It discusses various types of capital movements including foreign direct investment, portfolio investment, and official flows. Foreign direct investment involves direct ownership in companies overseas, while portfolio investment is a passive investment in securities abroad. Official flows include loans and grants from governments and international organizations. The document also examines determinants of capital flows and the role of foreign capital in economic development for countries.
This document discusses multinational corporations and the foreign exchange market. It provides details on:
1. The characteristics and criteria of multinational corporations, including operating in multiple countries, local subsidiaries managed by nationals, and centralized global management.
2. Factors that influence foreign exchange rates, such as trends in foreign trade, capital movements, speculative activities, and government control.
3. Components of a country's balance of payments, including the current account of exports/imports and invisibles, and the capital account of long-term and short-term capital flows.
This document provides an overview of international finance management topics including:
1. The evolution of international monetary systems from the gold standard to the Bretton Woods system and floating exchange rates.
2. The concepts of globalization and growth of multinational corporations with increasing international trade and reduced barriers to capital flows.
3. Key aspects of international finance markets like the foreign exchange market, international money markets, and stock markets.
4. The balance of payments and international flows facilitated by agencies like the IMF, World Bank, and Asian Development Bank.
5. A case study on an Asian Development Bank project to rehabilitate slums in Pune, India.
The document discusses key components of the balance of payments including the current account, capital account, and financial account. It explains factors that influence international flows of funds such as economic conditions, government restrictions, exchange rates, and inflation rates in countries. It also summarizes several international organizations that facilitate global trade and financial flows, such as the IMF, World Bank, WTO, and regional development agencies.
Importance International Financial Management Financeijtsrd
This document discusses the importance of international financial management. It notes that globalization and financial crises have made financial management more complex. International financial management plays an important role in reducing risks faced by multinational corporations through tools like managing currency exchange risk, forward contracts, and hedging. It also coordinates different business functions and helps measure business performance through financial analysis. Proper international financial management is crucial for the success of multinational businesses given the complex financial challenges of operating across different countries and currencies.
Unit 1 international of financial managementAjita Bansal
International financial management refers to managing finance in an international business environment where foreign currency is exchanged. It allows organizations to connect with overseas business partners through international dealings. International financial management differs from domestic financial management due to factors like currency fluctuations, political risks, imperfect markets, and varied opportunities abroad. Some emerging trends in facilities management include the growth of outsourcing and integrated value-added services, adoption of modular workspaces and amenities, evolution of internet of things applications, and increased use of robots for repetitive or hazardous tasks. Challenges of international financial management include protecting natural resources, risks of terrorism, navigating different cultures, complying with laws and policies of various nations, and managing relationships between international currencies.
The document discusses recent changes in international financial markets over the past few decades. It notes the liberalization and deregulation of cross-border financial transactions, leading to integration and globalization of previously separate markets. New financial instruments and the rise of derivatives markets have increased complexity and speculation. While greater access to capital has benefits, it has also increased risks and volatility in markets.
This document provides solutions to end-of-chapter questions and problems from the textbook "Multinational Finance" by Kirt C. Butler. It is organized by chapter and provides answers to conceptual questions about topics like foreign exchange risk, political risk, and cultural differences in international business. It also works through numerical problems involving calculations with foreign exchange rates, forward rates, and currency conversions. The solutions are intended to help students check their understanding of key concepts and practice applying quantitative techniques in multinational finance.
presentation slides on international funds flow prepared by the group members in a new way thanks guys for providing such a beneficial, knowledgeable slides.
This document provides an overview of international financial markets, including the foreign exchange market, eurocurrency market, eurocredit market, eurobond market, and international stock markets. It discusses the history and development of each market, how they work, key participants, and motives for companies and investors to use these global financial systems. The markets allow multinational corporations to raise funds, invest globally, and facilitate international trade and currency exchange.
This document provides an overview of international finance concepts including the balance of payments, factors influencing international trade flows, and agencies that facilitate international capital flows. It defines the balance of payments as a measurement of all transactions between domestic and foreign entities over a period of time. The balance of payments is made up of a current account, capital account, and financial account. It also discusses factors that can influence international trade flows such as inflation, national income, government restrictions, and exchange rates. Finally, it outlines the roles of the International Monetary Fund and World Bank in facilitating international capital flows.
The document provides an overview of international financial management concepts including:
- It outlines the contents which will be covered such as the international financial environment, multinational corporations, international trade theories, and the international monetary system.
- It describes key aspects of the international financial system including the interdependence between countries through equity participation, investment, loans, grants, and technical collaborations.
- It discusses how the importance of international financial management has increased for companies and managers as operations have become more global in nature. Understanding both domestic and international markets is essential.
This document provides an outline for an international finance course. It includes 7 chapters that cover topics such as foreign exchange markets, international capital markets, time value of money, strategic decision making, international taxation, and international financial management. The course will be taught through traditional classroom teaching and multimedia presentations. Students will be evaluated based on attendance, assignments, classwork, and a final exam.
This document provides an introduction to international financial management. It explains that international financial management is crucial for multinational corporations to understand how international events may affect their business and how to take advantage of opportunities in foreign markets. It also discusses how changes in foreign exchange rates, interest rates, stock markets, and other financial factors in one country can impact others in today's globalized and interdependent financial world. Finally, it outlines three key aspects of international financial management that managers of multinational corporations must understand: the international financial system, foreign exchange markets, and factors of the host country's business environment.
International financial management deals with financial decisions in an international context and considers factors like foreign exchange risk, differing political and legal environments, and currency exposure. It involves using currency derivatives and is more complex than domestic financial management due to these additional risks and considerations. While the overall goal of maximizing shareholder wealth remains the same, international financial management requires navigating multiple accounting standards, banking rules, cultures and currencies across countries.
This document provides an overview of the basics of international financial management. It discusses the nature and scope of IFM, comparing domestic financial management to international financial management. It also describes the key participants in international finance, focusing on multinational corporations. MNCs own and control production facilities across countries, and account for a large share of global sales, assets, and employment. The document outlines the objectives, modes, and influences of international business, as well as the essential qualifications for a firm to be considered a MNC.
The document provides an overview of the international monetary system and the Bretton Woods system established after World War II. It discusses:
1) The establishment of the IMF and World Bank at the 1944 Bretton Woods Conference to regulate international monetary affairs and promote post-war reconstruction.
2) Key aspects of the Bretton Woods system including fixed exchange rates pegged to the US dollar, which was convertible to gold, and the ability for countries to adjust pegged rates with IMF approval.
3) Challenges that emerged over time including the US inability to maintain the dollar's peg as the world economy outgrew the fixed gold supply, leading to the system's collapse in the early 1970
The document summarizes India's balance of payments for the year 2009-2010. It has three main sections:
1. Current account which captures trade between India and the rest of the world through merchandise exports/imports and invisibles like services, transfers, and investment income. India had a current account deficit of 38,411 crores for 2009-2010.
2. Capital account covering foreign investment, loans, banking capital flows, and other capital flows. India had a capital account surplus of 53,602 crores.
3. Monetary movements showing India's IMF transactions and changes in foreign exchange reserves to balance the overall account which was a surplus of 13,441 crores
The document provides an introduction to international finance. It discusses that international finance is different than domestic finance due to foreign exchange and political risks, market imperfections, and expanded opportunity sets when operating globally. Effective international financial management requires controlling risks, managing imperfections, and maximizing opportunities while pursuing the goal of shareholder wealth maximization. Globalization trends like increased trade liberalization, financial market integration, and the emergence of the Euro as a global currency have further integrated the world economy.
This document discusses international finance, including the balance of payments, International Monetary Fund, and foreign exchange markets. It defines balance of payments as the record of all transactions between a country's residents and the rest of the world, including the current account, capital account, and reserves. The International Monetary Fund was created in 1945 to assist in reconstructing the international payment system after World War II and works to improve member economies. Foreign exchange markets allow currencies to be traded globally and determine relative currency values.
This document provides an overview of international financial management. It discusses key topics like the balance of payments, determinants of entry modes for international business like exports and counter trade, differences between international and domestic finance, events that increased global trade volumes, and trade agreements. International flow of funds is examined, specifically India's balance of trade. Outsourcing is also discussed as having impacted international trade through increased cross-border purchasing.
International financial management deals with planning and managing financial operations of international activities of an organization. It includes managing foreign exchange risks, international taxation, financing decisions, investments in international financial markets, and accounting differences between nations. The key functions are performed by the treasurer, who manages cash and secures financing, and the controller, who handles accounting activities. The scope of international financial management encompasses balance of payments, international institutions like the IMF and World Bank, and financial markets like foreign exchange markets.
This document provides an overview of international capital movements. It discusses various types of capital movements including foreign direct investment, portfolio investment, and official flows. Foreign direct investment involves direct ownership in companies overseas, while portfolio investment is a passive investment in securities abroad. Official flows include loans and grants from governments and international organizations. The document also examines determinants of capital flows and the role of foreign capital in economic development for countries.
This document discusses multinational corporations and the foreign exchange market. It provides details on:
1. The characteristics and criteria of multinational corporations, including operating in multiple countries, local subsidiaries managed by nationals, and centralized global management.
2. Factors that influence foreign exchange rates, such as trends in foreign trade, capital movements, speculative activities, and government control.
3. Components of a country's balance of payments, including the current account of exports/imports and invisibles, and the capital account of long-term and short-term capital flows.
This document provides an overview of international finance management topics including:
1. The evolution of international monetary systems from the gold standard to the Bretton Woods system and floating exchange rates.
2. The concepts of globalization and growth of multinational corporations with increasing international trade and reduced barriers to capital flows.
3. Key aspects of international finance markets like the foreign exchange market, international money markets, and stock markets.
4. The balance of payments and international flows facilitated by agencies like the IMF, World Bank, and Asian Development Bank.
5. A case study on an Asian Development Bank project to rehabilitate slums in Pune, India.
The document discusses key components of the balance of payments including the current account, capital account, and financial account. It explains factors that influence international flows of funds such as economic conditions, government restrictions, exchange rates, and inflation rates in countries. It also summarizes several international organizations that facilitate global trade and financial flows, such as the IMF, World Bank, WTO, and regional development agencies.
Importance International Financial Management Financeijtsrd
This document discusses the importance of international financial management. It notes that globalization and financial crises have made financial management more complex. International financial management plays an important role in reducing risks faced by multinational corporations through tools like managing currency exchange risk, forward contracts, and hedging. It also coordinates different business functions and helps measure business performance through financial analysis. Proper international financial management is crucial for the success of multinational businesses given the complex financial challenges of operating across different countries and currencies.
Unit 1 international of financial managementAjita Bansal
International financial management refers to managing finance in an international business environment where foreign currency is exchanged. It allows organizations to connect with overseas business partners through international dealings. International financial management differs from domestic financial management due to factors like currency fluctuations, political risks, imperfect markets, and varied opportunities abroad. Some emerging trends in facilities management include the growth of outsourcing and integrated value-added services, adoption of modular workspaces and amenities, evolution of internet of things applications, and increased use of robots for repetitive or hazardous tasks. Challenges of international financial management include protecting natural resources, risks of terrorism, navigating different cultures, complying with laws and policies of various nations, and managing relationships between international currencies.
The document discusses recent changes in international financial markets over the past few decades. It notes the liberalization and deregulation of cross-border financial transactions, leading to integration and globalization of previously separate markets. New financial instruments and the rise of derivatives markets have increased complexity and speculation. While greater access to capital has benefits, it has also increased risks and volatility in markets.
This document provides solutions to end-of-chapter questions and problems from the textbook "Multinational Finance" by Kirt C. Butler. It is organized by chapter and provides answers to conceptual questions about topics like foreign exchange risk, political risk, and cultural differences in international business. It also works through numerical problems involving calculations with foreign exchange rates, forward rates, and currency conversions. The solutions are intended to help students check their understanding of key concepts and practice applying quantitative techniques in multinational finance.
presentation slides on international funds flow prepared by the group members in a new way thanks guys for providing such a beneficial, knowledgeable slides.
This document provides an overview of international financial markets, including the foreign exchange market, eurocurrency market, eurocredit market, eurobond market, and international stock markets. It discusses the history and development of each market, how they work, key participants, and motives for companies and investors to use these global financial systems. The markets allow multinational corporations to raise funds, invest globally, and facilitate international trade and currency exchange.
This document provides an overview of international finance concepts including the balance of payments, factors influencing international trade flows, and agencies that facilitate international capital flows. It defines the balance of payments as a measurement of all transactions between domestic and foreign entities over a period of time. The balance of payments is made up of a current account, capital account, and financial account. It also discusses factors that can influence international trade flows such as inflation, national income, government restrictions, and exchange rates. Finally, it outlines the roles of the International Monetary Fund and World Bank in facilitating international capital flows.
The document provides an overview of international financial management concepts including:
- It outlines the contents which will be covered such as the international financial environment, multinational corporations, international trade theories, and the international monetary system.
- It describes key aspects of the international financial system including the interdependence between countries through equity participation, investment, loans, grants, and technical collaborations.
- It discusses how the importance of international financial management has increased for companies and managers as operations have become more global in nature. Understanding both domestic and international markets is essential.
This document provides an outline for an international finance course. It includes 7 chapters that cover topics such as foreign exchange markets, international capital markets, time value of money, strategic decision making, international taxation, and international financial management. The course will be taught through traditional classroom teaching and multimedia presentations. Students will be evaluated based on attendance, assignments, classwork, and a final exam.
This document provides an introduction to international financial management. It explains that international financial management is crucial for multinational corporations to understand how international events may affect their business and how to take advantage of opportunities in foreign markets. It also discusses how changes in foreign exchange rates, interest rates, stock markets, and other financial factors in one country can impact others in today's globalized and interdependent financial world. Finally, it outlines three key aspects of international financial management that managers of multinational corporations must understand: the international financial system, foreign exchange markets, and factors of the host country's business environment.
International financial management deals with financial decisions in an international context and considers factors like foreign exchange risk, differing political and legal environments, and currency exposure. It involves using currency derivatives and is more complex than domestic financial management due to these additional risks and considerations. While the overall goal of maximizing shareholder wealth remains the same, international financial management requires navigating multiple accounting standards, banking rules, cultures and currencies across countries.
This document provides an overview of the basics of international financial management. It discusses the nature and scope of IFM, comparing domestic financial management to international financial management. It also describes the key participants in international finance, focusing on multinational corporations. MNCs own and control production facilities across countries, and account for a large share of global sales, assets, and employment. The document outlines the objectives, modes, and influences of international business, as well as the essential qualifications for a firm to be considered a MNC.
The document provides an overview of the international monetary system and the Bretton Woods system established after World War II. It discusses:
1) The establishment of the IMF and World Bank at the 1944 Bretton Woods Conference to regulate international monetary affairs and promote post-war reconstruction.
2) Key aspects of the Bretton Woods system including fixed exchange rates pegged to the US dollar, which was convertible to gold, and the ability for countries to adjust pegged rates with IMF approval.
3) Challenges that emerged over time including the US inability to maintain the dollar's peg as the world economy outgrew the fixed gold supply, leading to the system's collapse in the early 1970
The document summarizes India's balance of payments for the year 2009-2010. It has three main sections:
1. Current account which captures trade between India and the rest of the world through merchandise exports/imports and invisibles like services, transfers, and investment income. India had a current account deficit of 38,411 crores for 2009-2010.
2. Capital account covering foreign investment, loans, banking capital flows, and other capital flows. India had a capital account surplus of 53,602 crores.
3. Monetary movements showing India's IMF transactions and changes in foreign exchange reserves to balance the overall account which was a surplus of 13,441 crores
The document provides an introduction to international finance. It discusses that international finance is different than domestic finance due to foreign exchange and political risks, market imperfections, and expanded opportunity sets when operating globally. Effective international financial management requires controlling risks, managing imperfections, and maximizing opportunities while pursuing the goal of shareholder wealth maximization. Globalization trends like increased trade liberalization, financial market integration, and the emergence of the Euro as a global currency have further integrated the world economy.
Master of business administration (scheme and syllabus)Shena Rao
The document outlines the course structure and syllabus for a two-year full-time MBA program. It includes:
- The first year consists of 8 compulsory courses per semester, along with a seminar. Students must also complete a 6-8 week summer training project.
- The second year consists of compulsory courses and a research project. Students select optional specialization courses in finance, marketing, or human resources.
- Detailed course codes, titles, duration, evaluation structure and reading materials are provided for core and optional courses. The program aims to provide students with management knowledge and skills for decision making.
The document discusses the Capital Asset Pricing Model (CAPM) and its relationship between risk and expected return. It defines key terms like expected return, variance, standard deviation, covariance, correlation, diversification, systematic and unsystematic risk. It explains that a security's risk is measured by its beta, which represents its non-diversifiable risk related to market movements. The CAPM holds that the expected return of an individual security or portfolio equals the risk-free rate plus a risk premium that depends on the security's systematic risk relative to the market.
The document discusses the capital asset pricing model (CAPM) and its use in valuing securities and selecting investments. It aims to examine if any shares are undervalued, calculate expected versus actual returns using the security market line, and suggest an optimal portfolio mix. Both primary data collected directly from sources and secondary data from journals, newspapers and the internet will be used. The scope is limited to using the security market line as an investment selection tool. Some limitations of CAPM are that it relies on unrealistic assumptions and beta is not stable over time.
This document discusses the cost of capital from an international perspective. It defines key terms like weighted average cost of capital and explains how cost of capital is determined. It also discusses how segmented versus integrated capital markets can impact a firm's cost of capital calculation. The document notes that international diversification can lower a firm's cost of capital. Cross-border stock listings are also discussed as a way for firms to potentially achieve a lower cost of capital.
This document summarizes an investment portfolio containing stocks, bonds, CDs, and discusses whether to invest in money markets. It analyzes several companies' financials and stock performance including Raytheon, SAP, Netflix, and American Italian Pasta Co. It was decided not to invest in money markets due to low interest rates, high fees from banks, and concerns the economy is headed for depression. By diversifying investments across stocks, bonds and CDs maturing at different times, the portfolio is projected to achieve a 10.4% return over 3 years.
Modern portfolio concepts ppt @ bec domsBabasab Patil
This document discusses modern portfolio concepts including portfolio objectives, return and risk measures, diversification through correlation, international diversification, components of risk, beta as a risk measure, the capital asset pricing model, and traditional versus modern approaches to portfolio construction. Key concepts covered include the efficient frontier, portfolio betas, and reconciling risk-return tradeoffs. Tables and figures are included to illustrate concepts such as correlation, efficient portfolios, security market lines, and portfolio risk-return relationships.
This document discusses multinational capital budgeting. It begins by defining capital budgeting and how it involves allocating resources to maximize returns. For multinational firms, this includes projects located beyond national boundaries. The objectives are then outlined as comparing subsidiary and parent perspectives, demonstrating how to evaluate international projects, and assessing risk. Key considerations for multinational capital budgeting are also reviewed such as exchange rate fluctuations, inflation, financing arrangements, blocked funds, salvage values, competition, government incentives, and real options. Methods for adjusting project assessments for risk are also described.
The document discusses the Capital Asset Pricing Model (CAPM). It defines systematic and unsystematic risk, the beta coefficient as a measure of systematic risk, and outlines the key assumptions and formula of CAPM. The Security Market Line (SML) graphs the relationship between risk and return predicted by CAPM. Some limitations of CAPM are that it assumes variance captures all risk and homogeneous investor expectations. Alternatives to CAPM discussed include Consumption CAPM, Intertemporal CAPM, and Arbitrage Pricing Theory.
Portfolio investment is a passive investment in securities such as stocks, bonds, and loans that does not involve active management or control of the issuer. It allows investors to diversify their investments across different asset classes through specialized administrators, achieving economies of scale while balancing investment risks like liquidity, price, interest rate, and exchange rate risk against potential profitability and benefits.
The Capital Asset Pricing Model (CAPM) was developed by William Sharpe in 1970 to calculate the expected return of an asset based on its risk. It distinguishes between systematic risk that cannot be diversified away, such as market risk, and unsystematic risk that can be reduced through diversification. The CAPM formula states that the expected return of an asset is equal to the risk-free rate plus a risk premium that is proportional to the asset's systematic risk or beta. Beta measures how volatile an asset's returns are relative to the overall market. The CAPM makes simplifying assumptions about investors and markets. While widely used, some argue it may not perfectly predict returns in practice.
1. introduction to portfolio managementAkash Bakshi
This document discusses traditional and modern approaches to portfolio construction. The traditional approach involves determining objectives, analyzing investor constraints like income needs and liquidity, determining the objective such as current income or capital appreciation, and selecting securities and their weights to minimize risk and maximize return. It involves four to six steps including analyzing constraints, determining objectives, selecting the portfolio, and considering factors like asset mix, growth, capital appreciation, safety, and diversification. The modern approach exemplified by Markowitz focuses more on risk and return analysis to minimize risk and maximize profit without considering individual needs.
The document discusses the history and evolution of international trade agreements from GATT to the World Trade Organization (WTO). It outlines the 8 rounds of negotiations under GATT to reduce tariffs and introduce discussions on non-tariff barriers. The final Uruguay Round led to the establishment of the WTO in 1995. The WTO aims to liberalize trade and provides a framework for resolving trade disputes between member countries. It oversees agreements on goods, services, intellectual property, investment, and agriculture.
The Fama-French model predicts a lower required return for this stock compared to the CAPM. This is because the Fama-French model accounts for additional factors beyond just market risk.
Overview of legal and financial risk-management considerations in financing international business transactions. In other words, "How to Get Paid, or Get what you Pay For in International Business".
This document provides an overview of the Capital Asset Pricing Model (CAPM). It begins by explaining that CAPM helps determine the fair price of assets by comparing the fair price to the market price. It then lists the key assumptions of CAPM, including that investors can borrow/lend at the risk-free rate and there are no taxes or transaction costs. The document goes on to define terms like the market portfolio return, market risk premium, individual risk premium, and the security market line. It also discusses how to calculate beta through regression analysis and how beta represents the systematic risk of an asset. In the end, it notes some of the limitations of CAPM and possibilities for relaxing its assumptions.
This document lists 50 potential finance project topics for an MBA in finance degree. The topics cover a wide range of areas including financial analysis of companies, mutual funds, banking, insurance, working capital management, derivatives, and capital markets.
Finmin report mumbai international fin centeraasif_4u
This document is a report on making Mumbai an international financial centre. It discusses the emergence of international financial centres globally and their role in facilitating cross-border trade, investment and other financial services. It examines Mumbai's potential to become an international financial centre given India's growing demand for international financial services and its competitive advantages. The report analyses the financial services provided by leading financial centres and the infrastructure and policies needed for Mumbai to effectively compete on the global stage. It also identifies deficiencies in Mumbai's financial markets that currently inhibit the provision of international financial services.
A Study On FOREX Risk Management With A Special Emphasis On Banks SUBMITTED BYMandy Brown
This document is a project report submitted by Rbhya Pal on a study of FOREX risk management with an emphasis on banks. The report provides an acknowledgments section thanking those who guided the project. It includes an introduction covering what FOREX is and the history of international monetary systems. It discusses the foreign exchange market, types of exchange rates, and how balance of payments relates to forecasting exchange rates. The report focuses on FOREX in India, the role of the RBI in management, and how commercial banks deal in FOREX and manage associated risks through hedging. It provides examples from ICICI Bank and SBI on FOREX trading in India and concludes with major findings.
Etude PwC sur les IPO transfrontalières (2012)PwC France
http://pwc.to/Vd93ha
Entre 2002 et 2011, les IPO transfrontalières ont représenté 9 % (1 172) du nombre total d’opérations et 13 % (220 milliards de dollars) du montant total levé dans le monde. Ces dix ans ont été marqués par une augmentation du nombre d’entreprises asiatiques réalisant des IPO transfrontalières. Les entreprises chinoises sont arrivées en tête avec 30 % (347) des IPO transfrontalières et 29 milliards de dollars levés.
This document discusses foreign exchange exposure and risk management. It covers key topics like foreign exchange markets and participants, exchange rate determination and theories, types of foreign exchange exposure including transaction, translation and economic exposure, and techniques for managing exposure such as derivatives, hedging, and asset-liability management. The goal is for students to understand how to protect organizations from risks in international financial transactions and effectively manage foreign exchange exposure.
11.measuring the volatility of foreign exchange market in indiaAlexander Decker
This document summarizes a research study measuring the volatility of foreign exchange rates in the Indian market. The study analyzes daily exchange rate data for the US dollar, euro, and Japanese yen against the Indian rupee over time. The objectives are to measure the volatility of these currencies, examine their co-movement, analyze the volatility distribution, and measure skewness and kurtosis. Hypotheses test whether the volatility is normally distributed. The results could help manage foreign exchange risk more effectively in India's increasingly globalized economy.
Measuring the volatility of foreign exchange market in indiaAlexander Decker
This document summarizes a research study measuring the volatility of foreign exchange rates in the Indian market. The study analyzes daily exchange rate data for the US dollar, euro, and Japanese yen against the Indian rupee over time. The objectives are to measure the volatility of these currencies, examine their co-movement, analyze the volatility distribution, and measure skewness and kurtosis. Hypotheses are tested regarding the normality of volatility distributions. The results could help manage foreign exchange risk more effectively in India's increasingly globalized economy.
This document provides solutions to end-of-chapter questions and problems from the textbook "Multinational Finance" by Kirt C. Butler. It addresses conceptual questions about international finance topics such as foreign exchange risk, political risk, cultural differences, and goals of financial management for multinational corporations. The solutions also discuss trade pacts, trends in exports, and classifications of economies. Key events in international monetary systems like the Bretton Woods agreement and currency crises are summarized.
This document discusses money, income, and employment in India. It begins with an overview of the quantity theory of money and the Indian money market. It then discusses methods for measuring national income, including the output, income, and expenditure approaches. Key figures from the advance estimate of India's national income for 2013-2014 are provided. The document concludes with a section on employment that notes the distinction between organized and unorganized sectors in India.
An Analysis of Emerging Market Diversification for an Irish Investorodohers3
This document appears to be a thesis or research paper that analyzes emerging market diversification for an Irish investor. It includes an introduction outlining the benefits of international diversification and emerging markets. It also provides a literature review on diversification, international diversification, and emerging market diversification. The paper will analyze risk, returns, and correlations of developed and emerging market indexes and construct Irish portfolios to compare their risk and returns over time.
This course aims to familiarize students with corporate finance dynamics in international markets. The course covers 5 units: international financial systems, foreign exchange markets, foreign direct investment and corporate finance, international risk management, and international pricing and tax environments. The course objectives are to understand the role of financial markets and evaluate cross-border investment opportunities. Students will learn about international financial instruments, currency derivatives, foreign exchange regulations, and managing currency risk. They will also cover taxation methods, tax treaties, and tax implications of foreign operations.
Mutual funds herding and its influence on stockBahrawar Said
This document discusses research on effective investment decisions in mutual funds. The objectives are to investigate herding behavior of investors, evaluate performance of mutual funds in Pakistan, and assess risk and return of individual funds. The research questions examine how herding can be measured, its impact on stock returns, evaluating past performance of Pakistani mutual funds, and comparing fund risk to returns. The document reviews literature on herding behavior and performance evaluation and presents the research design which involves pooled variance techniques, regression modeling, and measuring performance using Sharpe ratio, Treynor ratio, and Jensen's alpha. The study will collect data from secondary sources on 20 Pakistani mutual funds.
The document provides an overview of several topics in economics and finance through a series of lecture summaries:
1. It discusses business cycles, markets, financial institutions, and the various types of markets.
2. It then covers the flow of funds between different entities, the role of financial intermediaries, and foreign markets.
3. Several lectures focus on interest rates, present value calculations, determinants of interest rate levels, and the bond market.
4. Additional topics include monetary policy, money markets, mortgages, stock markets, foreign exchange, and derivatives.
The document discusses the relationship between the US and Chinese economies and currencies. It notes that the US economy depends heavily on foreign capital, particularly Chinese renminbi. China holds over $1 trillion in US treasury bonds and US debt totaled over $18 trillion as of September 2014. However, the relationship is complex as the two countries are also major trading partners and competitors. Maintaining a stable economic relationship is important for both countries but also challenging given the different economic systems and priorities.
This document provides an overview of mutual funds in India. It discusses the history of mutual funds in India, types of mutual fund schemes, advantages and disadvantages of investing through mutual funds, performance evaluation, risk and returns, tax treatment for unit holders, and tips for buying mutual funds. It also includes profiles of Standard Chartered AMC Pvt Ltd and IDFC AMC Pvt Ltd, findings from a survey on mutual fund awareness, and conclusions and recommendations.
How The Growth In Bond Market Affect The Performance Of Banks In Briics?inventionjournals
When it comes to raising capital, corporates have two major sources of external funds: Equity and Debt. Corporate debt consists of broadly two types – bank borrowings and bonds. A bond is a formal contract between a borrower and a lender whereby the borrower promises to repay borrowed money with coupons at fixed intervals and at maturity in which the participants are provided with the issuance and trading of debt securities. The main objective of this study is to understand how the growth in bond market affects the performance of the Bank in BRIICS countries. The variables like Bank’s capital to asset ratio, Domestic credit to private sector, NPA, Portfolio investment and Bond market size has been analysed and Panel regression has been used to find the results. The results showed that all the variables analysed have a positive impact on the bond market growth and a leading effect on the banks
IFM refers to the study of international finance and monetary theories. It involves analyzing interest rate differentials between countries, price differentials for goods quoted in different currencies, exchange rate regimes, and determining optimum currency areas. IFM examines how these economic factors interact in global financial markets and affect international trade.
This document provides sample assignments and questions for various business courses including Strategic Management, International Business Management, Banking, Finance, and Treasury Management. Some key points covered include:
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- Questions addressing the impact of various external environmental factors on business strategy.
- Sample assignments related to topics like turnaround strategy, strategic alliances, and competitive advantage.
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With the recent enactments as well as the Regulators spate to deepen and strengthen the bond market in India, the bond market in India is in for a major revamp. Masala bonds, one such instrument has been on the eye of the corporate(s) for enabling a proper bond market regime. My presentation looks intends to bring the corporate bond market into light and also analyses what masala bonds exactly are.
Using The ECM Approach between Growth of the Current Account Balance and Fore...AJHSSR Journal
ABSTRACT: The aim of this research to analyze relationship equilibrium to the long-term and short-term
between the current account balance and foreign exchange reserve. As datum from the world bankstarts from
1982 until 2018, the used methodology Error Correction Model (ECM). The result of the estimate and analysis
were the current account balance and foreign exchange reserve stationary at level with the ADF test. The
variables had relationship equilibrium for the long-term and had one-way causality. That was the foreign
exchange reserve that causesthe current account balance. For the long-term, the current account balance had
positively and not significantly to change the development of the foreign exchange reserves. From the shortterm disequilibrium relationship to the equilibrium relationship, the current account balance had negatively and
not significantly too to change the development of the foreign exchange reserves.The value of the current
account balance of Indonesia has a deficit in some periods. Itwould have a bad impact on domestic foreign
exchange reserves. To the Government, the Ministry of Trade to keep the export performance to the stability of
the current account balance surplus to increase the Indonesian economic growth.
KEYWORDS : Foreign Exchange Reserve, Current Account Balance, EC
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More from Punjab College of Technical Education (6)
1. COURSE MODULE
Instructor: Ragini Khanna e mail ID- Khanna_ragini@yahoo.com Mb- 9988531999
Course: International Finance (MBA IB 302)
Class: MBA IB Semester: III
International Finance a must for MBA IB students!!
International Finance deals with the financial decisions taken in the area of international
business. The growth in international business is evident in the form of highly inflated size of
international trade. The financial involvement of the trader’s exporters and importers and the
quantum of the cross country transactions have surged significantly. All this requires proper
management of international flow of funds for which the study of International Finance has
become indispensable!!
Course Objective: The course content has been designed in such a manner so as to equip the
students with international financial practices being followed at the global level i.e. to look
beyond the domestic boundaries- which is, indeed, the need of the hour. This course will give an
insight into the architecture of foreign exchange markets-participants, Cross, Spot, Forward and
Swap Rates, Inter-relationships between Foreign Exchange and Money Markets, Interest Parity
and Covered Interest Arbitrage, Swap Transactions and positions etc., International Monetary
system with its history, the types of foreign exchange operations and exposures along with the
hedging techniques, Country Risk analysis, Eurobanking, International Financial Institutions,
Structure of Balance of payment and finally trading at the International Stock Exchanges.
1
2. Distribution of Marks:
MSE’s 15
First hourly 5
Second hourly 5
Presentation 5
Assignments 10
Assignment 1
Analyze trend of Rupee VS Dollar, Rupee Vs Euro, Rupee Vs Ruble, Rupee Vs Yen and
Rupee Vs Pound Sterling for the past 3 months and its impact on the economy. How do you
Project the Future of Dollar in the near future.
Purpose: Understanding of foreign exchange market requires the understanding of current trends
in foreign exchange so with this purpose assignment is given to the students.
Assignment 2
Perform a comparative study of FDI flow analysis of China VS India. What Similarities &
differences can be accounted for FDI volumes between India and China?
Purpose: FDI supports development in the host country. We need to know the reasons why China
is able to attract more FDI than India because these are the 2 countries which are in direct
competition in the international market.
Assignment 3:
Analyze the trend of FII since liberalization in India and the latest impact of FII on the Indian
Stock Exchanges.
Purpose: FII’s are practically driving Indian stock markets. So students need to know their roles
and impact.
Assignment 4
2
3. Analyze the various “International” sources of financing followed by (atleast 5) Indian
Companies/ Multinational Corporations operating in India. The entire issue/ offering has to be
analyzed in detail.
Purpose: With the help of this assignment the students will get an idea of the various modes of
financing that have been actually been used by the companies in the past which will ultimately
help in the better understanding of the topic discussed.
Note: more assignments can be included as per the requirement of the course.
Activity 1
Country and the currency
The students will be asked to discuss about the currencies of various countries along with where
that currency is trading w.r.t. rupee.
Purpose: the activity will enhance the knowledge of students as they will come to know about
the currencies of different countries (other than the few popular ones) by mutual effort.
Activity 2
Let’s know the International Stock Exchanges
Students will be asked to discuss about the various stock exchanges of the world – their method
of operation, trading, settlement system, market cap, major indices etc.
Lecture Lecture Content Assignments
1 Introduction to the subject:
Meaning of international finance
Reason for increasing importance of international
finance.
International finance and global economy.
Role of international finance manager in
multinational corporations
3
4. 2 International financial environment: Assignment 1 Analyze
trend of Rupee VS Dollar,
Defining foreign exchange market
The exchange rate Rupee Vs Euro, Rupee Vs
Spot market. Ruble, Rupee Vs Yen and
Rupee Vs Pound Sterling
for the past 3 months and its
impact on the economy.
How do you Project the
Future of Dollar in the near
future?
3 International financial environment:
Forward Market
Quotation at the foreign exchange market-
Direct quote
indirect quote
Two way quotes
4 International financial environment:
Relationship between bid and ask prices of currencies,
spread and cost of transaction.
Cross Rate
5 Discussion :
Depreciation Vs Appreciation
Devaluation Vs Revaluation
Of various currencies in the past.
4
5. 6 Structure of Indian foreign exchange market:
History, Developments & Current Status.
7 Exchange rate determination
Factors Affecting exchange rate
Expectations and asset model of exchange rate
determination
Central Bank Reputation
Central Bank Independence
8 Case Study 1: The Mexico Peso problem
Case Study 2: The Bank of England Gains
Independence.
9 Theories of foreign exchange rate movement and
international parity conditions
Purchasing power parity
Absolute purchasing power parity,
10 Theories of foreign exchange rate movement and
international parity conditions
Relative Purchasing Power Parity
International Fisher Effect
11 Foreign Exchange Exposure: Meaning, Introduction
Transaction Exposure
Transaction Exposure
Operating Exposure
5
6. 12 Foreign Exchange Exposure: Meaning, Introduction
Transaction Exposure
Hedging and Management of Transaction
Exposure
13 Case Study 1: Computing Transaction exposure for
Boeing.
14 Foreign Exchange Exposure: Meaning, Introduction
Hedging and Management of Translation
Exposure and Operating Exposure.
15 International Trade and flow of funds:
Introduction
Balance of Trade
Balance of Payment
16 International Trade and flow of funds:
Measuring impact of exchange rate movement on
the balance of payment
India’s Balance of Trade and Payment
A detailed discussion on foreign exchange reserves of
India
17 International Monetary System
The Gold Standard, 1876-1913
Decline of Gold Standard
The inter-war years, 1914-1944
The Bretton Woods System, 1945-1972
The Smithsonian agreement
6
7. The Flexible Exchange Rate Regime, 1973-
Present
Alternative Exchange Rate System
Evaluation of Floating Rate
18 Country Risk Analysis:
Nature of Country Risk Assessment
Economic Risk Indicators
19 Country Risk Analysis:
Techniques to Assess Country Risk
Parameters of Country Risk
Rates of Country Risk
Case Study 4: BP BILLITON CASE STUDY ON
INTERNATIONAL FINANCE
20 Foreign Direct Investment Assignment 2
Perform a comparative
Why do firms invest abroad
study Of FDI flow analysis
The Indian Perspective
of China VS India. What
Similarities & differences
Case Study 5: Case Study on Foreign Direct
can be accounted for FDI
Investment.
volumes between India and
China?
21 Foreign Institutional investment: Assignment 3: Analyze
the trend of FII since
Meaning, Needs importance liberalization in India and
The Indian perspective the latest impact of FII on
the Indian Stock
Exchanges.
7
8. 22 International Financial Institution/ Development
Banks
World Bank : History , Functions, Group
Members, Member Countries
World bank aid’s to India
23 International Financial Institution/ Development
Banks
IMF: History , Role, Functions, Member
Countries
Help to India
24 International Financial Institution/ Development
Banks
ADB: History , Role, Functions, Member
Countries
Help to India
25 Export & import financing: role of commercial banks.
Basic instruments, private non-bank sources of finance
26 Financial operations of multinational corporations:
Multinational project evaluation
Reasons for changes in cash flows, (Subsidiary
Vs Parent perspective)
27 Cost of Capital and Capital Structure of the
Multinational Firm
Cost of Capital for MNC’s Vs Domestic Firms
Determinates of Affiliates/ Subsidiaries Capital
Structure
28 Cost of Capital and Capital Structure of the
Multinational Firm
The Optimal Capital Structure and Cost of Capital
8
9. Cost of Capital across countries
Practical Framework of the Corporate Financing
Decisions
29 Capital Budgeting Techniques for Multinationals
NPV &APV method
30 Multinational Cash Management:
Introduction to multinational Cash Management
Objective
Centralized Perspective of Cash Flow Analysis
31 Multinational Cash Management:
Techniques to Optimize Cash Flow
Netting
Investing Excess Cash
32 Financing Of Multinational Corporations: Assignment4:-Analyze the
various “International”
International equity Market sources of financing
ECBs
followed by (atleast 5)
International Bond Market
Indian Companies/
Euro Market: Euro Commercial Paper, Euro
Medium term Notes etc. Multinational Corporations
operating in India. The
entire issue/ offering has to
be analyzed in detail.
33 International Trade financing:
Introduction and problems faced by developing
countries for promoting trade
Management of credit risk
Documents required such as letter of credit, Bill
of lading etc.
34
9
10. International Trade financing:
International Trade financing In India
Role of EXIM bank
35 International Equity Market:
The ADR &GDR Issues
Mechanics, Benefits and role of depositary
Guidelines of Level 1
36 International Equity Market:
The ADR and GDR issue
Guidelines of Level 2
37 Derivative Contracts
Futures & Forward contracts:
Meaning and Basics
Margin Systems
Trading & Settlement Rules
Marking to Market
38 SWAP
Introduction & Conceptual Framework
Evolution
Terminology
39. SWAP
Interest Rate SWAP
40. Case Study 6- Dow Chemical swaps Fixed-for-Fixed
with Michelin.
10
11. 41 SWAP
Currency Swaps & their
Pricing, Working, Rationale
42 Case Study 7- Dow Chemical swaps Fixed-for-Floating
with Michelin.
43 ECBs: External Commercial Borrowings and its
guideline & Current Scenario.
Specific guidelines issued by FIPB.
44 FEMA & FERA: Foreign exchange management Act,
History, Developments and Present regulation
45 International Stock Exchanges:
New York,
London,
Luxemburg,
third world and
Asian stock exchanges
Working and their influences.
46 Case Study 8:The Walt Disney Company’s Yen
Financing- Case Study Of Harvard Business
School
Recommended Books:-
Multinational Financial Management by Alan C. Shapiro
International Financial Management by PG Apte
International Finance by Maurice D. Levi
International Financial Management by B. Resnick
11
12. PRESENTATION:
1. The students will be divided into groups of 4.
2. The presentations will start at 9 a.m.
3. The duration of each presentation will be 15 to 20 minutes.
4. The preceding group will ask questions to the succeeding group and will get marks,
depending upon the validity of the question being asked.
5. The students are supposed to submit the synopsis of the material beforehand.
6. The evaluation criteria for presentation is as follows:-
Formals: 5 Presentation skills: 10
Query handling: 3 Questions: 2
Content: 10
Topics For presentation:
Role of Banks in Commodity Market
EURO: Analysis & Implications
Resource Mobilization by Indian Mutual Fund Industry.
Role of Foreign Institutional Investment in Indian Derivatives Market
International Stock Exchanges
Impact of Globalization on the Insurance Industry of India
FDI in Indian Retailing
Global Banking
Option and Futures trading in India
Will rebranding the Rupee would help brand India raise its currency?
Availability and Utilization of Foreign Exchange Reserves of India
The Yuan Revaluation- Impact on India.
Micro Finance- is it making the real impact?
International Financial investment strategies and regulations for Indian Companies.
The Blackberry Saga
12