Enroll Course: https://www.coursera.org/learn/investments-fundamentals
Navigating the world of investments can be daunting, especially when it comes to understanding how to accurately evaluate performance. Coursera’s “Investments I: Fundamentals of Performance Evaluation” course, taught by Professor Weisbenner, offers a robust and accessible introduction to the core principles that drive successful investment strategies. This course is a must for anyone looking to grasp the fundamental trade-offs between risk and return, build optimized portfolios, and understand the intricacies of security pricing.
The syllabus is thoughtfully structured, beginning with an “Investments Toolkit and Portfolio Formation.” Here, the course lays a solid foundation by refreshing basic investment concepts and then delves into historical patterns of stock and government securities returns. The practical application of these concepts shines through as students learn to construct optimal portfolios in Excel, balancing risk and return based on specific constraints. This hands-on approach is invaluable for solidifying theoretical knowledge.
Module 2 introduces the cornerstone of modern finance: the Capital Asset Pricing Model (CAPM). Professor Weisbenner masterfully breaks down the financial intuition behind CAPM, explaining how market-wide risk, or beta, dictates expected returns. The ability to interpret regressions for benchmarking securities and calculating risk-adjusted performance (alpha) is a critical skill that this module effectively imparts.
Building on CAPM, Module 3 explores its testing, introduces multi-factor models like the Fama-French 3-Factor Model, and discusses market efficiency. Examining predictable patterns in stock returns and understanding the implications of market efficiency for asset management provides a comprehensive view of how financial markets operate. The pros and cons of various asset-pricing models are debated, equipping learners with a critical perspective.
Finally, Module 4 shifts focus to “Investment Finance and Corporate Finance: Firm Valuation.” This module covers two primary valuation methods: market multiples and discounted cash flow. Learning to value perpetuities and understanding the challenges in projecting long-term cash flows and risk are crucial for any investor. The practical exercise of valuing Google at its IPO using market data offers a tangible application of these valuation techniques.
Overall, “Investments I: Fundamentals of Performance Evaluation” is an exceptional course. It strikes a perfect balance between theoretical depth and practical application, making complex financial concepts understandable. Professor Weisbenner’s clear explanations and the course’s structured approach make it highly recommendable for students, aspiring financial analysts, and anyone seeking to enhance their investment acumen. The course not only equips you with essential tools for performance evaluation but also provides a solid stepping stone for further learning in the investment domain.
Enroll Course: https://www.coursera.org/learn/investments-fundamentals