General Objectives of the Course
To develop awareness of the international dimension of the finance function as well as the international competition affected by currency values and other international variables. At the end of the course the student will be able to manage to solve exchange currency problems, use of derivatives instruments to hedge risk positions and international payments and transferences.
Specific Objectives
To analyse the structure of the current international financial markets
To solve exchange currency problems and the risk involved in
To create hedging positions to cover risk financial situations throughout derivatives instruments
To understand import/export financing conditions and instruments for international transferences as well as the contract conditions
Content of the course
Introduction to International Finance
Multinational Corporations
The International Monetary System
The Gold Parity
Balance of Payments
Balance of Payments Theory
The international flow of goods, services and capital
Structure of Balance of Payment
The Forex Exchange Market
Market participants
The determination of exchange rates
The Spot, Forward and Derivatives Markets
Parity conditions in international finance and currency forecasting
The Power Purchase Parity
The International Fisher Effect
Currency forecasting
Managing Exposure
Operating Exposure
Accounting Exposure
Economic Exposure
Import and Export Financing Operations
Financing instruments
Government help to finance export
Methodology
The course format will be a combination of lecture, discussion, and problem solving. Students are expected to be prepared for class by having read the assigned material in advance and by working all assigned homework problems. Problems similar to those assigned can be expected to appear on the scheduled exams.
Exams may consist of problems, multiple choice, and short answer questions
Class Participation consist on how active the student turns to be at class
Homework and quizzes will be grade base on the readings at the class schedule and the web sites which contains valuable information
Lecturer Profile
The lecturer for this course will need to have some practical experience on international finance and international trade transactions. He will need to account with a Master degree in Finance or in Business Administration with a focus on finances studies.
Texts
Eitman, Stonehill, and Moffet, Multinational Business Finance, 8th Ed., Addison Wesley, 1997. http://hepg.awl.com/eiteman/mbf8/ Supplementary Bibliography
Bodie; Z., Kane, A. and Marcus, A.J., "Investments", 2nd. Edition, 1993, Edit. Irwin. (B,K&M)
Fabozzi, F.J. and Modigliani, F. "Capital Markest: Institutions and Instruments", 1992, Prentice -Hall International. (F&M)
Francis, J.C. "Management of Investments", second edition, 1988, McGraw Hill (Francis)
Jones, CH. P., "Investment: Analysis and Managemnet", 3th edition, 1991, De Wiley. (Jones)
Levi D. Maurice, "Finanzas Internacionales", Tercera Edicion 1997 México, D.F.. editorial Mc Graw Hill (Maurice)
Shapiro, A.C. "Multinational Financial Management" fourth edition, 1992, Allyn and Bacon. (Shapiro)
Tan, Ch. H. "Financial Markets and Institutions in Singapore", eight edition, 1996, Singapore university Press, National University of Singapore. (Tan)
Other readings:
Neswpaper: "El Financiero" y "El Economista"
http://www.cem.itesm.mx/dacs/ecofin/homepag.html Magazine The Economist http://www.economist.com/ The Financial Times: http://www.ft.com/