LSE MSc Finance (Part-time) 2013/14 Brochure

The MSc Finance (Part-time) evening programme provides a unique opportunity to combine a full-time career with a world-class Masters in Finance programme, grounded in academic depth and rigour.

The programme is tailored to meet the needs and demands of professionals aspiring to high-powered careers in the financial sector and is aimed at people currently working in or around London’s financial services sector who are thinking about moving into, or acquiring further in-depth expertise in, the area of finance. It is ideal for those who want a focused, academically rigorous Masters degree to give them a solid foundation in the field.

• 21 months (September 2013 —July 2015)

• £27,552

• Approximately 50 places

• Must have a good undergraduate degree in any discipline with at least a 2.1 or the equivalent

• Must demonstrate quantitative ability

• Must be based in Greater London, ideally working in or around the Financial Services Sector

• Two to five years of relevant work experience will be considered an advantage

• Submission of GRE or GMAT test results is an advantage but not a requirement

MSc Finance Programme (Part-time) 3

4 MSc Finance Programme (Part-time)

MSc Finance (Part-time) Information EveningsHeld at LSE, the MSc Finance (Part-time) Information Evenings are a great opportunity for prospective applicants to learn more about the MSc Finance (Part-time) Programme, allowing them to experience a sample of an optional course, speak to current students, faculty and admissions staff and network with fellow applicants.

20 March 2013 • 29 May 2013 • 7 August 2013

Register for a place via lse.ac.uk/finance


Welcome from the Programme Director

The MSc Finance (Part-time) Programme is designed to service the large pool of intelligent, innovative and motivated people working in London’s Financial Services Sector who want to study a highly rigorous, world-class Finance Master’s degree but without having to give up their jobs and take a career break. So, as opposed to running courses on a weekend or in modules every few months, six years ago we

launched the MSc Finance (Part-time) programme, where classes are taught twice a week in the evenings to allow professionals to come to lectures directly from the office and never be too far away from their desks.

Over two years the programme builds from the solid base of two core courses (Asset Markets and Corporate Finance, studied in Year One) followed by a range of very specialised optional courses in Year Two that allow students to tailor the programme to their specific interests and careers. The key strength of this programme, and LSE in general, is that the way we teach finance is different from at other institutions, both in London and the rest of the

world. Our programmes are very rigorous, are based solidly on financial and economic theory and benefit strongly from research-influenced teaching. Of course that is not to say that our teaching is not directly relevant to the real world, which we make sure that it is. However, here at LSE, we want to ensure that our students understand the foundations of finance; that they do not just memorise formulas, but that they understand where they actually come from. After taking the programme we want our students not only to have a grasp of how something works but also, crucially, why it works that way.

When designing the programme, we took into account the fact that part-time students all have busy professional lives, so we are able to offer tailored support towards their studies. If a student misses a lecture because they have to go to New York for a deal or a has a late client meeting then they are still able to keep up with what they missed in class by taking advantage of our dedicated support network of PhD students, who are available via email or by phone to answer questions.

I hope that this brochure gives you a flavour of what the MSc Finance (Part-time) at LSE can offer you. If you have any questions or need more information I recommend that you attend one of the Information Evenings. I very much look forward to meeting some of you in September 2013.

Dr Jean-Pierre Zigrand Programme Director

Year 2

October – December January – March

Elective Courses Four half unit courses selected from:

Applied Financial Valuation*

Cases in Corporate Finance*

Financial Engineering*

Fixed Income Securities and Credit Markets*

Risk Management and Financial Institutions*

Topics in Portfolio Management*

Other courses may be available with permission of the Programme Director

* Exclusive to MSc Finance students

May – June Review and Exams

Submission of 6,000 word Dissertation in lieu of an exam

Programme StructureAs a student enrolled on the Part-time programme you will have access to the same highly rigorous curriculum offered by a full-time LSE Masters programme, within a tailored part-time structure. In addition, the dynamic learning environment of the Part-time programme enables students to derive added benefit from participating in a class comprising fellow finance-sector professionals, providing a practical grounding to the concepts studied.

The programme begins with core courses in corporate finance and asset markets, which give a thorough grounding in the principles of finance seen through real world applications, taught in part using case studies. This same combination of rigour and relevance is continued in the advanced elective courses, which provide deeper practical insight into finance as practiced by

leading financial institutions.

Year 1

September Pre-sessional Course Quantitative Methods

October – December January – March

Core Courses Corporate Finance

Asset Markets

May – June Core course exams



Teaching and AssessmentThe programme is taught in the evenings during term-time and takes place in LSE’s state-of-the-art New Academic Building. Taught in three-hour sessions, the teaching allows the study of core theoretical concepts, whilst also allowing students to gain a practical understanding of the application of these concepts via case discussion and practical homework problems. In addition, regular Saturday help sessions are run throughout the year to allow students to ask detailed questions and catch up on any material that they may have missed.

In Year One, the programme is taught on two evenings per week; the timetable in Year Two is dependent on students’ elective course

choices, with course teaching again taking place on weekday evenings during term-time.

Courses are assessed by a final examination, with all courses also having projects or coursework as a component of the assessment. Students will be required to write a 6,000 word dissertation (replacing the exam) in one of the half unit elective courses studied in Year Two.

All students are required to attend a short pre-sessional course in late September 2012, covering both essential quantitative methods required for the core courses.

“ “I really appreciated how the programme was designed to fit into my working life. Although it is never easy to study a part-time programme it is extremely do-able if you have the will and are dedicated to it. For me, being in the professional world whilst studying enhanced my academic experience so much. It gives you a real-world tool kit that you can use and apply every day; I constantly find myself referring back to my textbooks at my desk in an investment bank and the methods we learnt on how to value a company, from the top down and from the bottom up, I use on a daily basis.

Lauren HurwitzMerrill Lynch

Core CoursesAsset Markets

This course focuses on the three main asset classes – fixed income, stocks, and derivatives – giving a unified perspective of modern valuation methods. Starting with the present value formula the course then proceeds to fixed-income securities, focusing mainly on Government bonds, which we will value off the term structure of interest rates, using the present value formula. The connection with the principle of no-arbitrage will be emphasized. The course will then move to stocks, starting with portfolio theory and then deriving the relationship between risk and return (CAPM). The CAPM will provide a risk-adjusted discount rate, used to discount stocks’ cash flows with the present value formula. Alternative pricing models such as the APT and multi-factor will also be covered, and the models will be applied to issues of asset allocation and portfolio selection. The final topic will be derivatives, especially focusing on futures and options. After familiarizing students with the use of derivatives, the course will cover the main valuation methods (binomial model, Black-Scholes) emphasizing again the principle of no-arbitrage.

Corporate Finance

Corporate Finance is the study of how corporations raise capital and make investment decisions. The primary objective of the course is then to examine the financial decisions of firms with regard to their capital structure decisions (how to raise capital) and capital budgeting decisions (which investments to make). In the first part of the course we discuss the choice between debt and equity initially in idealized world and then we introduce real-world frictions such as taxes, financial distress, asymmetric information, corporate governance, and inefficient markets. We also discuss topics such as IPOs and convertible securities. In the second part of the course we introduce the techniques for valuing projects and companies, and also discuss topics such as mergers and acquisitions and real options.


“ “We could very easily just teach students the current financial tools, the current ways in which firms finance their investments for example, but in 18 months that would all be old news. What is constant, however, are the underlying theories of Corporate Finance, so what we do at LSE is to help our students to fully understand these theories, this intuition, so that in the future they can encounter new problems and be able to adapt.

Professor Christopher PolkFM422 Corporate Finance

Elective CoursesApplied Financial Valuation

This course covers advanced topics in Corporate Finance and Valuation and introduces students to valuation techniques for both securities and projects. The first part of the course introduces students to performance evaluation and draws implications of prospective performance evaluation for the pricing of stocks in efficient markets. This is followed by a focus on the determination of intrinsic security prices and then finally the course provides empirical evidence on returns to trading strategies based on fundamental analysis.

Each of the topics introduced in the course covers both institutional details and results of relevant academic research (theoretical and empirical), supported by case studies.

Cases in Corporate Finance

This course examines how to apply corporate finance concepts in a wide variety of business situations via the use of case studies. The course builds on concepts in business strategy, valuation techniques, and capital structure theories covered in previous courses to see how to apply these tools in a systematic and rigorous way when approaching complicated real-life corporate finance problems. Examples of topics include capital structure, risk management, initial public offerings, entrepreneurial finance, international corporate finance and family firms.

Financial Engineering

This course covers the basics in derivatives theory, and how to apply them to a multitude of financial securities and structured products. The pricing of such engineered products is covered first in theory and then the course reviews selected case studies in order to gain a better understanding of their practical usage and also implements some of the models numerically.

Risk Management and Financial Institutions

This course gives an overview of risk management in the context of portfolios of fixed income securities and derivatives, as well as dealing with credit risk. Throughout, the course spends a significant amount of time on practical applications of the theories that are introduced. Some limitations of current approaches are also discussed.

Fixed Income Securities and Credit Markets

This course provides a thorough grounding in recent developments in fixed income securities pricing, hedging and portfolio management. It covers topics including the analysis of the main products traded in the credit markets, an analysis of the main credit derivatives, the specific tools used in the industry to evaluate and hedge these products and the process of securitisation, with particular reference to collateralised

default obligations and mortgage-based securities.

Topics in Portfolio Management

This course provides analytical and statistical tools for the management of investment portfolios. The course focuses on stocks, bonds and currencies, with some attention paid to alternative asset classes such as commodities, real estate, and hedge funds. It considers portfolio risk management, international diversification, currency management for international investors, asset allocation, trade implementation costs and trading strategies, and portfolio performance measurement and attribution.

Full details of all of these courses can be found on LSE’s online Calendar: www.lse.ac.uk/resources/calendar/courseGuides/graduate.htm


The ClassData taken from 2011/12 cohort


Mathematics 6%

Engineering 19%

Business Administration/

Management 19%

Other 11%

Science 17%

Accounting and Finance 13%

Economics 15%

Previous degrees

Students on the programme are working in a range of front to back office roles throughout the Financial Services industry. The following is an indicative sample of some of the positions held by the current class.

Accenture (Finance and IT Consultant)

Bank of America/Merrill Lynch (Credit Risk)

Barclays Wealth (Business Analyst)

CitiGroup (Financial Data Analysis, Analyst)

Credit Suisse (Legal)

Deutsche Bank (Trading, Associate)

EDF Energy (Senior Energy Analyst)

GLG Partners (Associate)

Goldman Sachs (Fixed Income Securities Sales)

JP Morgan & Chase (Trading, Associate)

Lloyds TSB (Capital Markets Lawyer)

Macquarie (M&A, Senior MD)

Morgan Stanley (Software Development)

Nomura (Fixed Income Trading)

PwC (Risk Assurance, Associate)

Standard Chartered Bank (Market Risk Analyst)

UBS (Technology Analyst)


“ “The class was amazing, all very intelligent people but each with different strengths and weaknesses. So when we worked together it was clear that people were learning from each other, feeding off their own professional experience and also gaining from the experiences of others. For example, in the Financial Engineering course we had a group project where we had to build option pricing models, which takes a lot of different skills; programming, mathematics, understanding the different options and structures. So we were able to combine a group with people who were strong in all of these skills, just as you would in the professional world. In that process we all learned from each other.

Jawad KoradiaNomura


The Department and the FMGThe Department of Finance is one of the largest finance

groups in Europe and is recognised as being one of the leading

finance research groups in the world. We are a research-led

department that is devoted to excellence in all fields of finance;

our world-leading faculty operate at the forefront of their fields

internationally and we have a pre-eminent reputation for both

our consistently excellent and cutting-edge research and rigorous,

innovative and applicable taught degree programmes.

The development of the Department in recent years has been

closely linked to the significant growth in finance research and

teaching at LSE, feeding off the pioneering work of the LSE’s

Financial Markets Group and Department of Economics, as well

as the growth of London as one of the world’s financial capitals.

As a result, we offer our diverse and international student body

a range of academically challenging finance programmes that

equip them with the tools to become future leaders in the finance

sector and in academia.

The research activities of the Department are closely linked to the Financial Markets Group (FMG). Since its founding in 1987 by Charles Goodhart, Mervyn King and David Walker, the FMG has become one of the leading centres in Europe for academic research into financial markets with strong links to the City and beyond. Its activities include weekly research seminars, funded research projects, post-doctoral research and a programme of major conferences and academic visitors that reflect its world-class prominence and reputation. The FMG is currently headed by Professor Christopher Polk, who is also a member of Finance

faculty. Recently, the FMG and the Paul Woolley Centre for the Study of Capital Market Dysfunctionality (headed by Professor Dimitri Vayanos, also a member of Finance Faculty) were particularly involved in supporting and contributing to LSE’s major report into The Future of Finance. This is just one of many examples of ways in which our research continues to stimulate and lead debate in the finance field. The work of the FMG was in a springboard for the founding of the Department of Finance, and its research-focused ethos is still the foundation of all that we do.

Alongside the FMG, the Department maintains strong links with

research centres at other institutions around the world, as well

as with the wider financial sector. Our proximity to the City and

our reputation for excellence means that we are regularly able

to attract high-profile professionals and sector leaders to speak

at Department events, and to participate in conferences and

practitioner seminars. This, in conjunction with the remarkably

rich and stimulating events programme offered by LSE, enables

us to give our students exposure to a quality of speakers that is

unsurpassed in the world.

LSE Events page: lse.ac.uk/publicEvents/eventsHome.aspx

FMG: lse.ac.uk/fmg/home.aspx

““For me LSE has become the most exciting place in Europe to study finance. Our Faculty has grown to become the biggest finance group in Europe and has very strong academic credentials. When you combine that with LSE’s incredibly strong institutional history, especially the Department of Economics, which is one of the best in the world, this really contributes to making our MSc Finance Programme one of the strongest in the world.

Dr Ulf Axelson

FM414 Cases in Corporate Finance


The LSE AdvantageAll of our students, be it part-time or full-time, benefit from “The LSE Advantage” – the stimulating and vibrant learning and research environment which extends further than just their degree programme. LSE’s status as a world-class social sciences institution allows it to attract some of the best researchers and teachers in their respective fields. Located in the heart of central London, the stimulating environment of LSE provides a rich intellectual challenge for students and access to pre-eminent researchers and speakers through a regular programme of conferences and public lectures.

LSE also houses the British Library of Political and Economic Science, the largest social science library in the world and is currently undergoing a transformation of its central London campus, to provide state-of-the-art facilities for all its students. LSE students and alumni also play a key role in a wide range of societies and groups covering sports, networking, specialist lectures, interests and more. Prominent examples that may be of interest to you include the Finance Society, Alternative Investments Society (and their leading conference), Hedge Fund Society and more, as well as the extensive Banking and Finance alumni network.

Added to the world-class resources of LSE, the MSc Finance (Part-time) programme offers numerous benefits that extend beyond

the classroom. From day one of your studies, you will participate in a dynamic learning environment which, coupled with regular networking events, provides valuable opportunities for you to exchange ideas with fellow professionals to share knowledge and career experience. The academically rigorous content of the programme and practical teaching style will enable you to apply the knowledge learned in the classroom directly to your professional life from an early stage, building the foundations for your future career development.

The programme also provides a range of tailored resources to support part-time students in combining their studies with demanding professional lives. This includes regular academic help and review sessions, dedicated course support and extensive administrative support for all students. Being only a short journey form the City and Canary Wharf LSE is also ideally located for professionals to commute to and from the office for teaching, studying with their classmates or attending public lectures.

““I’ve always thought of LSE as an incredibly interesting and exciting place to teach, research and study. It’s very different to most universities - you might pass a government minister in the corridor or get into a lift with a CEO of a bank. The school is a hive of activity, both because of its location and its international reputation, from which students directly benefit.

Professor David Webb

Head of Department

Students’ Union: lsesu.com

About LSE: lse.ac.uk/aboutLSE/aboutHome.aspx

AdmissionsApplications are made online via the Graduate Admissions Office website. The online system allows you to track every stage of your application and we aim to return a decision to you within six to eight weeks of receipt of your complete application. All queries on the application process will be answered by the Graduate Admissions Office team. lse.ac.uk/study/graduate/home.aspx

Several factors are taken into account when assessing an application, which can be demonstrated in your personal statement, references, transcript and any supporting documents:

• Appropriate work experience (see below)

• Strong academic performance (a minimum 2.1 in any subject)

• A demonstrable level of quantitative ability

Work Experience

A key part of a successful application relates to an applicant’s work experience. The selection committee are looking for students who will be working and living in or near London, in or around the financial sector (broadly defined) from the start date of the programme. Applicants who cannot demonstrate they will be in this position when they apply will be at a significant disadvantage.

References

The Selection Committee are looking for two academic references. If you cannot provide two academic references then one academic and one professional reference can be considered.

Personal Statement

Applicants should use their personal statement to highlight how their professional experience is relevant to the study of a Masters in Finance, including motivation for taking the MSc. In addition, if your quantitative skills are not directly demonstrated by your undergraduate degree you should provide evidence of this in your statement (some candidates may also wish to provide a GMAT or GRE test score).

English Language

lse.ac.uk/study/graduate/enquirer/entryRequirements/englishLanguage.aspx

Graduate Admissions Office: lse.ac.uk/study/graduate/gettingInTouch.aspx

Department of Finance Admissions Team: [email protected]



Programme Aim Provides a unique opportunity to combine a full-time career with a world-class masters in finance programme that is grounded in academic depth and rigour

Profile High-level graduates from fields which may not be specifically relating to finance, whose career objectives lie broadly within the financial services sector

Application Requirements

• Subject area – any background is considered. Students must be able to demonstrate their quantitative ability somehow in their application

• Grade – a minimum of 2.1 (see Graduate Admissions website for non-UK equivalency)

• References – two required, preferably both academic

• Personal statement

Additional Information

• GMAT/GRE – Not required, but can demonstrate quantitative ability

• IELTS/TOEFL – not a pre-requisite to apply. May be required on receipt of an offer in certain cases (see Graduate Admissions website)

Admissions Information

• Duration – 21 months: September 2013 to June 2015

• Fees – £27,552 (£13,776 in year 1; £13,776 in year 2)

Summary

Faculty


Name Research Interest

Professor Ronald Anderson Emeritus Professor of Finance

Dynamic corporate finance; contingent claims analysis; credit risk; financial market structure and regulation; structuring financial contracts and institutions.

Dr Ulf Axelson Reader in Finance

Private equity; financial innovation and security design; corporate finance; auction theory; and financial intermediation.

Dr Elisabetta Bertero Lecturer in Finance

Sub-sovereign debt; the financial role of the state – the interaction between governments and financial markets; budget constraints and state-owned firms; international finance.

Dr Maria Cecilia Bustamante Lecturer in Finance

Dynamic corporate finance; asset pricing implications of corporate decisions; real options; game theory.

Dr Georgy Chabakauri Lecturer in Finance

Asset pricing; portfolio choice; risk management.

Professor Mikhail Chernov Professor of Finance

Empirical asset pricing; options; fixed-income and credit models; applications of econometric methods.

Dr Vicente Cuñat Lecturer in Finance

Corporate finance; applied theory; applied econometrics; industrial organisation; labour and personnel economics.

Dr Jon Danielsson Reader in Finance

Financial risk analysis; value at risk; volatility modelling and forecasting; extreme value theory.

Dr Amil Dasgupta Reader in Finance

Information economics and game theory with applications to finance; the theory of delegated portfolio management and consequences for financial markets; the theory of financial crises.

Dr Jack Favilukis Lecturer in Finance

Consumption based asset pricing, incomplete markets; heterogeneity and inequality; limited participation and participation costs.

Professor Daniel Ferreira Professor of Finance

Corporate finance and governance; organisational economics.



Dr Stephane Guibaud Lecturer in Finance

International macro and finance; asset pricing; yield curve; optimal debt management; recursive contracts.

Dr Christian Julliard Lecturer in Finance

Macroeconomics; finance; applied econometrics; international economics and finance; real estate finance.

Dr Dong Lou Lecturer in Finance

Empirical asset pricing; behavioral finance; empirical corporate finance.

Dr Ian Martin Visiting Lecturer in Finance

Empirical Asset pricing.

Dr Antonio Mele Reader in Finance

Asset prices and the business cycle; information networks in financial markets; statistical inference for dynamic models in finance.

Dr Philippe Mueller Lecturer in Finance

Macro-finance; empirical asset pricing; fixed income; financial econometrics.

Dr Yves Nosbusch Lecturer in Finance

Sovereign debt; intergenerational risksharing; asset pricing and macroeconomics; empirical asset pricing.

Professor Stavros Panageas Visiting Professor in Finance

Asset pricing; microeconomics.

Dr Daniel Paravasini Lecturer in Finance

Corporate Finance; credit and banking; development economics.

Professor Christopher Polk Professor of Finance

Asset pricing; corporate finance; behavioural finance; hedge funds; private equity; macroeconomics.

Dr Rohit Rahi Reader in Finance

Arbitrage in segmented markets; financial innovation and security design; asset pricing with asymmetric information; general equilibrium theory; incomplete markets; networks.

Faculty (continued)



Dr Andrea Tamoni Lecturer in Finance

Theoretical and Empirical Asset Pricing, and Financial Econometrics.

Professor Dimitri Vayanos Professor of Finance

Theoretical and Empirical Asset Pricing, and Financial Econometrics.

Dr Andrea Vedolin Lecturer in Finance

Asset pricing; derivatives pricing; financial econometrics; portfolio theory.

Dr Michela Verardo Lecturer in Finance

Empirical asset pricing; market efficiency and investment anomalies; trading behaviour of institutional investors; behavioural finance.

Professor David Webb Professor of Finance, Head of Department

Financial economics and insurance economics; economics of information; corporate finance and financial markets.

Dr Moqi Xu Lecturer in Finance

Empirical corporate finance/governance

Professor Kathy Yuan Professor of Finance

Bubbles and crises; liquidity; heterogeneous information; mutual funds; hedge funds; network theory; short-sale and margin constraints; global games; asset pricing.

Dr Konstantinos Zachariadis Lecturer in Finance

Market microstructure and design; information economics and game theory with applications to finance; corporate governance as related to economic efficiency.

Dr Jean-Pierre Zigrand Reader in Finance

General equilibrium asset pricing; financial intermediation and delegation; continuous time asset pricing; herding; market crashes; foundations of arbitrage.


““The Programme gave me a lot more confidence in the workplace. Once you learnt something in class you felt that you could then go back into the office and easily discuss it as you actually understood the theory behind it… Also I can’t stress enough the personal growth that I experienced over the two years; the Programme really taught me how to manage my work-life balance, which has put me in good stead professionally – now I feel that I can take anything that is thrown at me and not be fazed at all.

Ore BajomoCredit Suisse

“ “As a Senior Consultant for one of the Big four auditing firms most of my clients are from the Financial Services Sector. So although I am not actually working as a trader or an investment banker, by doing this programme I have a much better understanding of my clients’ business, which allows me to provide professional services tailored to their needs.

Li LiangDeloitte

Printed on recycled stock

Department of Finance Admissions The London School of Economics and Political Science Room OLD 3.05, Old Building Houghton Street London WC2A 2AE

Email [email protected]

Tel +44 (0)20 7955 7316

Websites lse.ac.uk/finance lse.ac.uk/finance/prospectiveStudents lse.ac.uk/finance/prospectiveStudents/admissions_enquiries

The information in this handbook can be made available in alternative formats, on request. Please contact the Department of Finance.

The School seeks to ensure that people are treated equitably, regardless of age, disability, race, nationality, ethnic or national origin, gender, religion, sexual orientation or personal circumstances.

Freedom of thought and expression is essential to the pursuit, advancement and dissemination of knowledge. LSE seeks to ensure that intellectual freedom and freedom of expression within the law is secured for all our members and those we invite to the School.

Design: LSE Design Unit lse.ac.uk/designUnit

Photography: Nigel Stead, LSE Photographer, Simon J Tuck Photography

Produced by: Department of Finance, October 2012

Documents

LSE MSc Finance (Part-time) 2013/14 Brochure