BUS ADM 442: Principles of Investment, Fall 2017

Mussie Teclezion, PhD Office Hours: Tuesday 9:30 11:30 AM

460-M Wood Hall Wednesday 9:30 11:30 AM
Phone: 920-465-2466 Or by appointment
e-mail: teclezim@uwgb.edu

Course Description
Fundamental concepts, theories, and techniques relating to investing; securities markets,
investment vehicles and environments, portfolio construction and management; active and
passive investment strategies; global investment perspectives and their impacts on investors;
blend of facts and theories relating to traditional and modern portfolio approaches; ethics
in investment decisions; applied computer-assisted investment decisions. The course is
upper-level writing emphasis course, within the Universitys General Education requirements.

Upon completion of this course you should be able to:

1. Describe the general structure of various financial markets and the financial
instruments that trade in those markets.
2. Trade stocks, bonds, mutual funds, ETFs, Options, and Futures in domestic and
international markets.
3. Compute betas of different assets or portfolios using historical data or other
relevant inputs.
4. Estimate expected return of a financial asset using Capital Asset Pricing Model
(CAPM).
5. Evaluate performance of portfolios (in Excel) using different performance
evaluation criteria such as: Sharpe ratio, Treynor ratio, and Jensons alpha.
6. Prepare a report and articulate in the report the performance of a portfolio against
a benchmark.
Price options using the Black-Scholes option pricing model.

Required text and materials

1. Jordan, Miller, and Dolvin, Fundamentals of Investments, Custom 7th ed., 2014,
McGraw-Hill/Irwin.
2. A financial/business, scientific or any calculator capable of raising a number to a
power.
3. Recommended reading, The Wall Street Journal (Section B: Business & Finance)

Course Objectives: This course addresses the following PLLGs

PLLG 1. Approach business challenges from an interdisciplinary perspective

PLLG 2. Apply problem solving skills to complex challenges representative of those facing
the business community
GRADING
Component Percent Point Total Final Grade
Written Assignments (3) 30 >= 93 A
Exams (3) 45 88 to 93 AB
Online Quizzes 10 83 to 88 B
Book Reviews 5 78 to 83 BC
Class Participation 5 73 to 78 C
Stock-Track Assignments 5 67 to 73 D
100 < 67 F
Grade Components:

Grade Components:
Exams: There will be three exams for the class. Exams will have concept
and problem questions.
Writing Assignments: Three equally-weighted written assignments on assigned topics.
Details will be provided in class. Writing quality is especially
important on the assignments. Pay particular attention to spelling,
punctuation, and grammar. Source material must be appropriately
cited, and quoted or paraphrased material must be specifically
noted (footnotes or endnotes). Assignments will be collected in
class.
Online Quizzes: Quizzes will be posted in McGraw-Hill Connect website.
Online Discussion: You are expected to actively participate (i.e. ask questions,
answer questions, provided your opinion on topics discussed, and
so on) in class. See relevant section in D2L for more details.
Stock-Track Assignment: Each student will manage a virtual fund. There will be
assignments that will need to be completed in StockTrak
Website.
Class Participation: You are expected to actively participate (i.e. ask questions,
answer questions, provided your opinion on topics discussed,
and so on) in class.

MAKEUPS: Given at the discretion of the instructor.

Organization of the course:

The course is organized in D2L. You are expected to log-in few times a week and keep up
with the postings in D2L throughout the semester. Although D2L is the main course
platform, there will be two other sites that very important for the class.

What you will find in D2L

In D2L you will find course announcements, contents posted, drop boxes to submit your
assignments, discussion board, grades posted, as well as links to other websites, such as:
McGraw-Hill Connect and StockTrak trading simulation sites.

McGraw-Hill Connect is the platform for taking Online Quizzes. We will also use StockTrak
trading simulation as a site to conduct all the trades during the semester. Therefore, next
two things you should do RIGHT after getting your text book are REGISTERING ON
MCGRAW-HILL CONNECT AND STOCKTRAK WEBSITES USING THE CODES THAT
COME WITH CUSTOM EDITION OF THE TEXTBOOK.

StockTrak trading
No discussion on trading (I will not use the word investing, as the trading period is only 14
weeks) would be complete without some sort of actual trading even though it is fake money!
Here you will have the opportunity to put into practice what you learn in the course.
Although, the StockTrak assignment is only 5% of your grade, the last writing assignment
(10%) will be based on your trading activities. That is, 15% of your grade will be directly or
indirectly tied to StockTrak. Thus, it is very important that you execute several trades, at
least 50, and as much as possible evenly spread throughout the semester. Your grade will
be based on the number and type of trades you place (long, short, buying futures,
writing calls, and so on) as well as how you evaluate and report your performance.
Whether you beat the benchmark or not will have nothing to do with your grade for
StrokTrak related assignments. There are also StockTrak assignments than need to be
completed on the StockTrak website.

COURSE SCHEDULE (coverage may be adjusted as needed):

Date Coverage
Wednesday, September 6 Ch. 1 (Introduction: returns, risk, statistics)

Monday, September 11 Ch. 1 (Introduction: returns, risk, statistics)

Wednesday, September 13 Ch. 2 (The Investment Process)

Monday, September 18 Ch. 2 (The Investment Process)

Wednesday, September 20 Ch. 14 (Futures Contracts)

Monday, September 25 Ch. 14 (Futures Contracts)

Wednesday, September 27 Ch. 14 (Futures Contracts)

Monday, October 2 Ch. 15 (Stock Options)

Wednesday, October 4 Exam #1

Monday, October 9 Ch. 15 (Stock Options)

Wednesday, October 11 Ch. 15 (Stock Options)

Monday, October 16 Ch. 4 (Mutual Funds)

Wednesday, October 18 Ch. 4 (Mutual Funds)

Monday, October 23 Ch. 5 (Stock Market)

Wednesday, October 25 Ch. 5 (Stock Market)

Monday, October 30 Ch. 6 (Common Stock Valuation)

Wednesday, October 1 Ch. 6 (Common Stock Valuation)

Monday, November 6 Ch. 7 (Market Efficiency)

Wednesday, November 8 Exam #2
Monday, November 13 Ch. 8 (Behavioral Finance)
Wednesday, November 15 Ch. 11 (Diversification and Asset Allocation)

Monday, November 20 Ch. 11 (Diversification and Asset Allocation)

Wednesday, November 22 Ch. 12 (Return and Risk)

Monday, November 27 Ch. 12 (Return and Risk)

Wednesday, November 29 Ch. 13 (Performance Evaluation, and Risk Management)

Monday, December 4 Ch. 13 (Performance Evaluation, and Risk Management)

Wednesday, December 6 Ch. 16 (Options Valuation)

Monday, December 11 Ch. 16 (Options Valuation)

Wednesday, December 13 Ch. 16 (Options Valuation)

FINAL EXAM: According to UWGB exam schedule

Stock-Trak Portfolio Simulation Guidelines

Each student will start by registering at the Stock-Trak site for the class.
(http://www.stocktrak.com/members/registerstudent?className=BusAdm442-Fall-2017).
Your initial wealth is $1,000,000 in virtual cash. You can invest it in stocks, bonds, futures, options,
mutual funds, and futures options. You could use the code that comes with the textbook. You should
start trading by the week of September 11 and trading will end on December 7, 2017 at 4:00 PM. You
can register to open an account starting 9/5/2017.

The portfolio simulation for this class has dual objectives of enhancing students understanding of
markets and the nature of different financial instruments, by trading them in virtual markets, and at
the same time putting into practice investment management theories and practices that are discussed
in class. Therefore, as fund managers your objective is to outperform S&P 500 by actively trading
different financial instruments. You could also trade on margin as well as short securities. During the
course of semester you are expected to make at least 50 trades, with minimum of 5 trades per week.
During the trading period, you should keep the following points mind:
- Make note of some of your most successful trades and least successful trades
- Make sure you trade at least two of the following financial instruments (stocks, ETFs, mutual
funds, futures, and options).
- Track the overall daily value of your portfolio and your benchmark (S&P 500), i.e. record the
end of the day value of each.
- Calculate the daily and annualized return and risk of your portfolio as well as that of the
benchmark.
- Plot daily market value of your portfolio for the trading period.
- Plot a graph that compares the compound return of your portfolio to that of the benchmark.
- Evaluate the performance of your portfolio to that of the benchmark using different
performance evaluation metrics, such as: sharp ratio, treynor ratio, and Jensons Alpha.
- Take note of some of your successful holdings and compare their performance with that of
the benchmark.
- Take note of daily events that may affect the value of your portfolio.
Online Quizzes (Connect Finance)
There is one online quiz for almost every chapter. The grade for two online quizzes with lowest scores
will be dropped. The online quizzes will be very good learning tool as they will give you feedback on how
well you are grasping the material and at the same time enhance your mastery of the class material.
You are allowed to attempt each online quiz as many times as you would like. However, almost all the
questions will change every time you start a new attempt. The attempt with the highest score will be
graded and posted in D2L. The online quizzes are available at a separate site than the D2L platform.
The web address for the online quizzes for the class is:
http://connect.mheducation.com/connect/shortUrl.do?accessUrl=m-teclezion-442-fall-2017
Once you visit the above link, you will find instructions on: how to register for the site with access
code or how to buy access code online. The textbook comes with access code.

Disability: The University wants to ensure students with disabilities have equal access to education.
If you have a documented disability and require an academic accommodation please contact me and the
Disability Services Office at phone# 465-2841, email: dis@uwgb.edu as soon as possible. It is
important that you do this early in the semester as some accommodations can take time to arrange.

UWGB disability services website: http://www.uwgb.edu/ds

Academic dishonesty policy:

This course follows the academic misconduct policy of UW-Green Bay.

Academic misconduct includes any act in which a student:
1. Takes credit for the work of others through plagiarizing, not using proper citation etc.
2. Causes intentional damage to the course materials, academic work of other students
3. Uses unauthorized materials, forges, fabricates or falsifies data in an exam or assignment
4. Assists other students in these acts
5. Cheats in exams, submits others academic work as their own without proper citation, giving
credit
6. Any other activity listed in UW System academic misconduct regulations that can be found at,
http://docs.legis.wisconsin.gov/code/admin_code/uws/14.pdf

Academic misconduct will result in the disciplinary actions mentioned in the UW-Green Bay academic
misconduct document and other course related disciplinary actions like reduction of grades, getting an
F grade and so on.

COURSE CALENDAR: BUS ADM 442: FALL 2017

Activities as well as related due dates for activities are subject to change.
Activities, Related Materials, and Due Dates Activity Due:
Week 01 and 02
Register on Connect see relevant section for details
Register on StockTrak see relevant section for details
Order the book that you will review & discuss online - see 09/25/2017
relevant section for a list of books as well as instructions
Read Textbook Chapter 01
PowerPoints for Chapter 01, see Chapter 01 Content
 Video: Sample problems from Connect Online Quiz Ch-01
Start Connect Online Quiz Ch-01 09/18/2017
Start Writing Assignment One - See Writing Assignment
content for more details 09/25/2017
Read Textbook Chapter 02
PowerPoints for Chapter 02
Video: Sample problems from Connect Online Quiz Ch-02
Start Connect Online Quiz Ch-02 09/25/2017
Start StockTrak Assignment One 09/22/2017
Week 03
Read Text Book Chapter 14
PowerPoints for Chapter 14
Video: Sample problems from Connect Online Quiz Ch-14
Start Connect Online Quiz Ch-14 10/09/2017
Start StockTrak Assignment Two 09/29/2017
Due: Connect Online Quiz Ch-01; 9/18/2017 @ 11:55 PM 9/18/2017
Due: StockTrak Assignment One; 09/22/2017 @ 3:30 PM 09/22/2017
Due: Email me title of the book you would like to discuss; 09/25/2017
09/25/2017
Week 04
Read Text Book Chapter 15
PowerPoints for Ch-15
Video: Sample problems from Connect Online Quiz Ch-15
Start StockTrak Assignment Three 10/20/2017
Due: Writing Assignment One; 09/25/2017 @ 11:55 PM
Due: StockTrak Assignment Two; 09/29/2017 @ 3:30 PM
Due: Connect Online Quiz Ch-02; 10/02/2017 @ 11:55 PM
Week 05
Read Text Book Chapter 15
PowerPoints for Chapter 15
Video: Sample problems from Connect Online Quiz Ch-15
Start Connect Online Quiz Ch-15 10/23/2017
Due: Exam One; 10/04/2017 @ 2:15 3:35
Week 06
Read Text Book Chapter 04
PowerPoints for Chapter 04
Video: Sample problems from Connect Online Quiz Ch-04
Due: Connect Online Quiz Ch-14: 10/09/2017@ 11:55 PM 10/09/2017
Start Connect Online Quiz Ch-04 10/30/2017
Start StockTrak Assignment Four 10/27/2017
Due: StockTrak Assignment Three; 10/20/2017 @ 3:30 PM 10/20/2017
Week 07
 Read Text Book Chapter 05
PowerPoints for Chapter 05
Video: Sample problems from Connect Online Quiz Ch-05
Start StockTrak Assignment Five 11/03/2017
Start Connect Online Quiz Ch-05 11/06/2017
Start Writing Assignment Two - See Writing Assignment 11/08/2017
content for more details
Due: Connect Online Quiz Ch-15: 10/23/2017@ 11:55 PM
Week 08
Read Text Book Chapter 07
PowerPoints for chapter 07
Due: StockTrak Assignment Four; 10/27/2017 @ 3:30 PM
Due: Connect Online Quiz Ch-04; 10/30/2017@11:55 PM
Week 09
Read Text Book Chapter 08
PowerPoints for Chapter 08
Due: StockTrak Assignment Five; 11/03/2017 @ 3:30 PM
Due: Connect Online Quiz Ch-05; 11/06/2017 @ 11:55 PM
Week 10
Read Text Book Chapter 11
PowerPoints for Chapter 11
Video: Sample problems from Connect Online Quiz Ch-11
Start Conncet Online Quiz Ch-11 11/20/2017
Exam Two (Covers Chapters 15, 04, 05, 07, and 08)

Exam Two; 11/08/2017 @ 2:15 3:35 PM 11/08/2017

Due: Writing Assignment Two; 11/08/2017 @ 11:55 PM
Start Writing Assignment Three 12/07/2017
Week 11
Read Text Book Chapter 12
PowerPoints for Chapter 12
Video: Sample problems from Connect Online Quiz Ch-12
Start Online Quiz Ch-12 11/27/2017
Week 12
Read Text Book Chapter 13
PowerPoints for Chapter 13
Video: Sample problems from Connect Online Quiz Ch-13
Start Connect Online Quiz Ch-13 12/04/2017
Due: Post book review; 11/20/2017 11/20/2017
Due: Connect Online Quiz Ch-11; 11/20/2017 @ 11:55PM
Week 13
Read Text Book Chapter 16
 PowerPoints for Chapter 16
Video: Sample problems from Connect Online Quiz Ch-16
Start Connect Online Quiz Ch-16 12/17/2017
Due: Connect Online Quiz Ch-12; 11/27/2017 @ 11:55 PM
Week 14
Due: Connect Online Quiz Ch-13; 12/04/2017 @ 11:55 PM
Due: Writing Assignment Three; 12/06/2017 12/06/2017
Week 15
Due: Connect Online Quiz Ch-16; 12/17/2017 @ 11:55 PM
Final Week
Final Exam (Covers Chapters 11, 12, 13, and 12/18/2017
16)
1:00 3:00 PM
Final Exam; Monday 12/18/2017 @ 1:00 3:00 PM