Elective Courses

This course covers financial data and software tools as well as the operational side of derivatives trading in a trading lab environment. Candidates will learn how the major systems such as Reuters and Bloomberg work in trading. Candidates will be shown the manner in which transactions are executed, either across telephone lines, telex or electronic trading devices, and the manner in which systems are used to help dealers update their trading blotters, and how positions are updated and risk monitored. Candidates will also learn the pre-settlement stage of each transaction and the settlement issues, including back-office support in accounting and handling of counter-party risk.

This course provides candidates with the legal background necessary to comply with the regulatory requirements in banking and finance. It covers the legal aspects of corporate governance, the legal framework of banking and finance, and financial products, including derivatives. This course also provides candidates with background on market access in financial services, as China embarks on liberalisation of its financial markets as a member of the WTO.

Divided into two parts, the first half deals with the theory and practice of modern macroeconomic analysis. The design of the course aims at making close contact with current macroeconomic events and providing an integrated view of macroeconomics. To achieve such goals, the introduction of a unified model that concentrates on the implications of equilibrium conditions in three sets of markets: the goods market, financial markets, and the labour market. A variety of applications and examples will be offered to show how economic concepts can be put to work in explaining real-world issues. The second half of the course concerns the forecasting of economic time-series, and focuses on techniques and models that are routinely used in applied work. Topics include ARIMA models, trends and seasonality, aberrant observation, non-linearity, ARCH and GARCH models, multivariate time-series and VAR models. As part of the course requirement, candidates are expected to generate and evaluate their own forecasts by using appropriate time-series models that are supported by key features of the data.

This course introduces candidates to the techniques of quantitative finance using MATLAB. The main topic includes the introduction to MATLAB, time-series analysis of financial data, simulation, optimization, back testing of asset allocation and trading strategies, introduction to financial databases and finite difference method. The course will illustrate the techniques with a lot of examples with real financial data. After taking this course, candidates should be able to implement the techniques in various financial applications.

This course covers bank management techniques that include asset and liability management, liquidity and reserve management, credit analysis, loan pricing and off-balance-sheet banking, as well as regulatory issues of commercial banks. It also discusses issues related to mortgage loan products and how real estate risks may affect the market value of mortgages.

Hedge funds are one of the fastest growing sectors of asset management. This course studies the styles of hedge funds and management strategies from an investment decision-making perspective. Topics covered in this module include environment and micro-structure of capital market, investment strategies, quantitative tools, derivative products, investment performance evaluation and discussions of some hedge funds failures. Special attention is given to various practical investment strategies and their risks, including equity selection techniques, market-neutral portfolio constructions, arbitrage strategies, emerging market investment, shortselling problems, etc.

Behavioral finance uses insights from psychology to understand how biases, heuristics, framing and emotions influences the decisions of individual and professional investors, markets and managers. It describes how and why these suboptimal decisions might deviate from those predicted by traditional financial or economic theory. The course also shows why arbitrageurs such as hedge funds cannot correct but instead choose to ride on the misbehavior and mispricing. The course will explore the implications of investor psychology and limitation to arbitrage in the individual trading behaviors, aggregate stock market and the cross-section of average returns, and corporate finance. How insights of behavioral finance complement the traditional finance paradigm will be examined, so that candidates will gain an understanding of how individuals and institutions actually make financial decisions (descriptive) and guidance on how to improve financial decision making (prescriptive) in themselves and others.

A real option is a right—not an obligation—to take an action on an underlying real asset. The action may involve, for example, abandoning, expanding, or contracting a project or even deferring the decision until a later time. Real options analysis (ROA) is a tool that helps to quantify the value of a real option. This course provides a synthesis of modern asset pricing and corporate finance via the framework of ROA. The course compares and contrasts ROA with the traditional tools of valuation. The benefits and limitations of ROA in terms of practical applications are also discussed.

This course examines the effects of market designs and trading mechanisms on various dimensions of trading quality. Its main objective is to help candidates to understand how markets work, and how governments and exchanges regulate them. Candidates will learn who makes market liquid; why some traders consistently profit from trading while others lose; and how trading rules/mechanisms affect price efficiency, liquidity and trading profits. With this knowledge, they can improve their trading strategies. If candidates are regulator or exchange officials, this knowledge will help them to design better markets. This course is also practical and covers many realistic trading mechanisms around the world. To develop candidates’ ability to apply theories into practices, this course covers several contemporary issues on market microstructure.

One of the key responsibilities of a CFO or CIO (chief investment officer) is to secure low cost funding for capex, acquisition or leveraging an investment. Reduction in funding cost can be achieved through strong credit standing, negotiation with banks or offering of security packages to lenders. With appropriate use of derivatives, not only can CFO/CIOs often further reduce their funding cost but they can also tap more sources of funding. Globalization of financial markets allows capital to flow easily across borders, thus allowing borrowers to tap offshore funding. But offshore funding is often denominated in foreign currency which then requires the use of derivatives to swap it into the desired currency. In this course, candidates study the use derivatives in financing and liability risk management. Besides getting an overview of the various forms of financing current available to corporations and financial institutions, candidates will also learn how to take advantage of the on- and offshore funding price gap in Asia and hedging a company’s risk exposures to interest rate and currency movements. In addition, it will reinforce their derivatives knowledge acquired in other courses through case studies and recent applications as seen by financial market.

Prerequisite: MFIN6003 Derivative Securities

This course covers a specific subset of topics in corporate finance including risk management, hedging, capital structure, and liquidity management. The basic idea of the course is that all corporate financial decision-making is some form of risk management. They are centered on notions of asset liability matching and should be well aligned with each other and with management and capital market expectations. The objective of the course is to explain the theory of corporate risk management and to demonstrate some of its real-world applications. In particular, the course will describe a 4-step corporate risk management process which includes defining a consistent risk strategy; quantifying market risk exposures; establishing an efficient benchmark and implementing risk strategies. It will also touch upon some recent developments in derivative accounting and their implications for corporate hedging.

This course offers latest developments in the theory and practice of risk measurement and management in the areas of (i) life insurance, (ii) property-casualty insurance, (iii) natural catastrophic risks, and, (iv) commodity price risk.

This course covers advanced topics in interest rate modeling and builds on material covered in earlier derivatives and mathematical finance courses. The course integrates theory and practice and focuses on the methods and models used by financial institutions to value interest-rate products. These include spot and forward rate models such as the Hull-White, HJM and the LIBOR market models and their extensions (displaced diffusion, CEV, stochastic volatility) and their calibration to market caps and swaptions. Important theoretical material needed to understand and extend these models is also be integrated into the course (e.g. forward measure, change of numeraire/measure).

Prerequisite: MFIN7012 Fixed Income Securities and Interest Rate Modelling

This course is designed to provide a holistic view of financial engineering. The course will introduce the candidates to the whole work flow of product design, pricing, packaging and post-execution management. The emphasis is on real life practical concerns and on financial markets in Asia region. The course aims to provide a comprehensive and consistent view of the various underlying financial assets and their characteristics. It emphasizes the importance of a client-oriented engineering process and aim to illustrate the characteristics of various client segments with different investment and hedging needs. As part of the course, candidates are introduced to several financial products such as FX carry strategy and commodity derivatives etc. After course completion, a candidate should have a better understanding not only of the process of financial engineering but also of how financial engineering fits into the machinery of a modern investment bank.

This course provides students with the foundations and practical knowledge enabling them to launch and manage their own entrepreneurial venture including a hedge fund, private equity, venture capital or asset management firm. Taught as a combination of practical classes and guest lectures by industry professionals, the course covers the entire fund and business launch spectrum including fund structuring, investor capital raising, investor due diligence, regulatory, tax, governance, fund terms, private placement regulations, market trading rules, service provider selection, counterparty selection, employment matters, real estate, technology, operations, etc. The course also covers the investor landscape and investor lifecycle from early stage investors to institutional capital raising from global family offices, fund of funds, endowments, private banks and pension funds. We also cover the ongoing management and deal making of such funds from angel and venture capital early investments to private equity deals and exits. The course also discusses the global trends and industry institutional best practices, the customs and usage in the industry as well as some of the future trends, including FinTech and cybersecurity, and their impact on the industry. This is a very practical course with a heavy emphasis on the latest industry trends and best practices rather than theoretical concepts.

The global financial market is flat. International financial markets have experienced an explosive growth in the past two decades. Financial innovations, deregulation of national markets, the rise of emerging markets and the massive increase in international assets held by governments have fuelled a global liquidity wave and opened new avenues for international investments. At the same time, the speed and depth of the global contagion experienced in the wake of the US subprime crisis has underscored the financial markets/products’ interconnectedness. The purpose of this seminar would be to offer a framework for the analysis of international investment decisions. The seminar will extend the standard investments theories and products to a global setting through a series of introductory lectures, but the focus will be hands-on interaction with the candidates through case studies and analysis of materials in class.

This course will provide insights into key aspects of fund management, with a focus on investment strategies. Much of the course will be taught using a case-study approach, often relying on the experience of the faculty and their guest speakers. The first part of the course will start with a quick recap of investment principles leading to a discussion of fund management and delving into the current issues in the industry. Alternative investments will then be introduced, including hedge funds, private equity and real estate. The course will employ case studies from thereon to illustrate some of these issues with a particular focus on investment strategies. The second part of the course will pick up with an overview of the business side of fund management, highlighting the key issues faced by fund managers outside of their portfolios. An overview of selected investment strategies will be given, with an emphasis on the distinction between strategies pursuing market inefficiencies and strategies pursuing directional bets. The rest of the course will feature case studies adopting global macro, long-short equity, and fixed income strategies, and discussions highlighting the impact of corporate governance on the investment decision.

This course gives candidates an overview of Asian financial markets, their latest development and future trends so that candidates can better prepare themselves for building their career in finance in the region. It consists of company visits, executive talks/seminars, training, networking and/or cultural activities.

This is a special course that deals with various current topics in finance. Topics covered may vary from year to year, depending on the research interests of the instructor.

The world of global finance, banking and financial services is changing rapidly with the emergence of start-up financial technologies, commonly referred to as FinTech that may disrupt the status quo.  Taught as a series of practical courses (and potentially also guest lectures by industry entrepreneurs and professionals), the course covers the main pillars of the FinTech start-up ecosystem in the US as well as Asia, including peer to peer lending platforms, internet finance, online finance, bitcoin, digital currencies, digital payments, big data, cybersecurity, cryptography, etc and their practical impact on global banking and finance.  This course will provide students with the latest empowering and practical knowledge on FinTech enabling them to understand some of the FinTech changes taking place currently in the financial services industry and, most importantly, the trends that will impact the industry in the future.  This is a very practical course with a heavy emphasis on team projects (and potentially also guest lectures) on the latest industry trends and best practices by industry experts and entrepreneurs.

This course aims to provide students with a practical approach to equity valuation and investing. They will learn how to apply the key concepts, techniques and tools used by market practitioners in making real world investment decisions. Topics include: identifying sources of value, core valuation techniques - discounted cash flow, multiples analysis of comparable companies, real options valuation, and other valuation methods commonly used by practitioners; an overview of the asset management industry; the fundamental assumptions and approaches to value investing; risk management in the investment process.

This course provides students a foundation in managing and analyzing financial datasets as well as other datasets. The first part of the course focuses on building skills – data manipulation using programming languages. The second part introduces various financial databases. Through practice on real-world financial datasets, students will learn methods used to warehouse and retrieve data for statistical computing. The course then turns to analytical methods with a focus on demonstrating these methods on real-data from various contexts in finance. Methods covered include statistical modeling and inference, machine learning, textual analysis, classification and alternative datasets. Problem sets and projects will be the primary mode of learning. Course learning will be supplemented with exposure to industry speakers from the local financial industry.

Prerequisite: MFIN7005 Corporate Finance and Asset Valuation

Machine learning and artificial intelligence are the apex technologies of the information era. These methods are getting increasingly popular in the financial market. This course provides students the fundamental models and methods of machine learning and apply them to solve real-world financial problems. The topics include regression, classification, clustering methods, model selection, topic modeling and policy search. The first part of the course focuses on supervised learning techniques for regression and classification. The second part of the course covers unsupervised learning techniques for clustering and matrix factorization. The third part of the course covers reinforcement learning algorithm. The last part provides the fundamental concepts of artificial intelligence and its implications. The course provides introductions to the latest datasets in financial markets and practices applying learning algorithms to these datasets in a variety of topics. The primary mode of learning is based on assignments and projects.

This course provides students a foundation in managing and analyzing large datasets for applications in finance. The first part of the course focuses on building skills – data custodianship and performance computing. Through practice on real-world financial datasets, students will learn methods used to warehouse and retrieve data for high-performance statistical computing. The course then turns to analytical methods with a focus on demonstrating these methods on real-data from various contexts in finance. Methods covered include statistical modeling and inference, machine learning, textual analysis, classification and alternative datasets. Problem sets and projects will be the primary mode of learning. Course learning will be supplemented with exposure to industry speakers from the local financial industry.

This course covers the main elements of natural language processing (NLP), text analytics, and text mining, providing students with a foundation in collecting, managing, and analyzing textual data with financial applications in mind such as FinTech. Examples of potential applications include understanding and responding to sentiment in financial newspapers and social media, using social media to improve performance in asset/investment management, due diligence, Fed watching, monitoring of company events, and detecting insider trading. Although students write their own computer programmes in this course, they are not required to implement most algorithms from scratch. Instead, the focus of this course is on how to use existing state-of-the-art open-source software libraries and how to apply them in a financial context. This course consists of three parts. In the first part, we work with real-world textual data sets to obtain proficiency in collecting, importing, organizing, and cleaning textual data from sources related to finance and FinTech. Among others, we cover web scraping, textual corpora, text processing, tokenization, stemming, and stop word removal. In the second part we delve into a more detailed analysis of NLP, text analytics, and machine learning with a particular focus on finance and FinTech. For instance, we examine bag-of-words, word weighting schemes, document classification, document clustering, sentiment analysis, and topic models. The third part consists of summarizing, displaying, and visualizing results obtained from NLP and text analytics for applications in finance and FinTech.

This course provides a foundation for advanced quantitative trading in financial markets. The course has two parts. First, the course reviews stylized facts and methods used for time-series predictability, cross-sectional asset pricing and strategy performance evaluation. The second part of the course uses these tools to study recent advances in investment strategies sourcing from academic and practitioner literature. For example, the course will discuss new theories on risk premia, intermediation-based asset pricing, and quantifiable soft information and alternative data. The primary method of learning will be a combination of problem sets and projects. Subject to availability, learning will be supplemented with exposure to industry speakers from the local financial industry.

Prerequisite: MFIN7002 Investment Analysis and Portfolio Management

This course intends to be a highly applied one. The knowledge of econometrics that has immediate applications in finance will be imparted to candidates. This course is not a pure econometrics theory course, nor is it a course to exhaust financial applications of econometrics. It is designed to equip candidates with knowledge of relevant econometric theories and the ability to apply such knowledge to several finance models. Candidates are required to do computer exercises to implement relevant econometric techniques during the course. Upon completing the course, candidates are expected to appreciate usual practical applications of econometrics in finance and carry out their own empirical investigations. The course should help candidates gain access to more advanced topics if they so wish.

This course extends the study of fixed income and credit risk to focus on mortgage products, asset-backed securities, and other debt market instruments.

This course aims to enhance awareness of ethical issues regarding international corporate decision-making, and provides candidates with business strategies and frameworks to deal with ethical problems. It starts with an introduction of concepts, including corporate social responsibility and moral decision-making process, and then discusses various ethical issues related to the global business system, international management strategies, technology, external and internal stakeholders, and corporate governance.

This course introduces the history, structure, and operating system of China’s capital markets. In the context of financial market globalization, the discussion of this course will focus on Chinese regulatory policies, institutional reform of markets, and public and private market investments. Historical trends will be analyzed together with recent development, providing insights from practical experiences in the markets. It will discuss China’s gradual shift towards a capital market-based financial system and policy issues faced by the Chinese governments during the process of multi-level capital market development.

This course provides an analytical framework to evaluate key problems in a structured approach and tools to manage uncertainty in business process. From this course, candidates learn the “language” of uncertainty using concepts in elementary probability, the procedure of framing decision-making in an uncertain environment, and the statistical methods for making inferences and decisions on the basis of limited information.

This course looks at the fundamentals of private banking and wealth management. Topics covered include the market segmentation and key drivers of the industry, the different business models used by major market players, the basic analytical tools for asset allocations and wealth planning, and the various wealth management products (with related risk/return profiles) and other services that are offered to High Net Worth (HNW) clients. The course intends to provide a conceptual and practical approach to domestic and international wealth management for market practitioners, HNW individuals and families, and other professionals.

This course provides a broad introduction to real estate with a focus on financing issues. Basic project evaluation, financing strategies, asset-backed securities, methods of valuation, REIT modeling and capital markets issues related to real estate are covered. No prior knowledge of the industry is required, but candidates are expected to acquire working knowledge of real estate markets.

This course provides in-depth discussions on perspectives of financial markets and corporate policies.

This course focuses on valuation and financing issues of project investment of enterprises, with an emphasis on financing strategy. The objective of this course is to guide candidates to think innovatively about capital management and utilize various financing channels. The course will also introduce the framework and practice of leasing, and the role of leasing as a way of financing in a company’s financial management.

This course aims to cover basic information and knowledge about project choice and financing, idea implementation, decision-making, and innovations in start-up businesses. The majority of such information and knowledge is delivered based on the case method (with supplementary lecture notes when appropriate). It is noteworthy that we will take two roles interchangeably throughout this course: the entrepreneurs who seek funding and the venture capitalists who seek good projects. Understanding the role of both important players in the entrepreneurial finance process helps us have an objective evaluation and unbiased assessment of potential ideas and projects.

The course aims to provide students with a solid understanding of the international financial system and a framework to gauge the risks and opportunities of financial globalization.  The target student clientele might want to pursue careers in currency trading, global banking, global asset management, multinational corporate finance, or risk management industry.  Topics include options markets and hedging of currency risk, international risk and return, international investment strategies, and capital budgeting in international valuation.

Prerequisite: MFIN7005 Corporate Finance and Asset Valuation

This is an advanced course on financial system.  The course aims to enable students to have a big-picture view and a deep understanding on how the financial system operates.  Financial investors and corporate managers make decisions within a large, interlinked, complex financial system. This system includes many players with different preferences, many financial instruments with different payoff structures, many financial contracting designs with different rules. A financial practitioner or researcher needs to have working knowledge on the operation of the financial system. Understanding the operation of the financial system is also crucial for understanding some extreme events in financial markets (e.g. financial crises, market crashes); indeed, those extreme events, occurring within a very short investment period, are responsible for a large portion of the realized returns of financial market investments.

Prerequisite: MFIN7002 Investment Analysis and Portfolio Management

This course will offer students the practical knowledge and latest research findings at the frontier of household finance, enabling students better understand how households are approaching these financial decisions, what errors they might make in doing so, and what frictions they may encounter in attempting to solve the problems. We also attempt to empower future business leaders with the analytical tool and critical approach to become intelligent contributors to improve household saving and spending behavior through better financial product design and regulations, as well as help avoid problems such as inadequate retirement planning, excess leverage and poorly formulated decisions.

This course aims to introduce current development of financial market solutions, i.e., green finance (climate finance) and environmental, social, and governance (ESG) to address climate change problems. This course will cover the topics including green bonds, impact investment, carbon finance, ESG investment, and climate finance. Other related topics are accounting, certification, and reporting of ESG information.

The course aims to examine questions on different aspects of a modern full-service bank, including how it makes profit in each of the main business areas, as well as the main risks that it faces and how it manages those risks.  The course focuses on financial statement analysis and also analyzing the accounting and disclosure rules for financial instruments, in order to reveal the strategies followed by the bank given the various regulations under which it operates.

This course is a practical application of modern investment theories. It offers basic philosophy, theories, and practice along with real world insights. We will present the modern techniques of investing: search, valuation, technical analysis, economic and industrial research and finally the construction of an investment strategy. The course will apply the investment framework from the ground up and cover the most recent investment themes including Metaverse, Semiconductors, Electric vehicles (EV) and self-driving techniques, US/China debates and geopolitical changes in China. These topics will help students apply what they learned from textbook in real world investment and better understand the limitation of the current standard forms of techniques. Students will also work on a project to develop their own strategy using real-world data and have a full picture of the portfolio management.

This course covers the fundamentals of Venture Capital (VC) and Private Equity (PE) as well as the key elements within the ecosystem. PE/VC is one of the asset classes of alternative investments and is essential for financial investors to evaluate and understand the risk and return of this asset class, which has become increasingly important for most institutional investors. The course would be beneficial to students who are interested in the financial sector and particularly in VC and PE.

This course is designed to provide students an opportunity to acquire first-hand knowledge of international business environment. Experiential learning and knowledge exchange will be applied throughout the study field trip to develop students’ understanding of international business environment in a different cultural context and help them construct a global perspective. Firm visits and cultural related activities will be arranged during the study field trip to arouse students’ awareness in cultural diversity and enhance their understanding of how culture can impact international business strategy.

The goal of this course is to provide students an introduction to the topic of renewable energy finance and develop the concepts and practical tools that are essential in this field. The course contains lectures, problem solving exercises, cases, and academic paper reading. Lectures and exercises are used to develop the basic skills, academic paper reading deepens the understanding, and case analyses improve the decision-making ability under complex real-world situations. The course will be case intensive and requires a substantial amount of reading and discussions.

You can take up to two electives from the Master of Accounting, Master of Economics, Master of Finance in Financial Technology, Master of Global Management, Master of Science in Business Analytics or Master of Science in Marketing programme at HKU. Enrollment in electives from other programmes is subject to seat availability and approval by the Programme Directors concerned, based on your profile, capabilities, and performance in the MFin programme.

Since enrollment in other taught postgraduate electives is not guaranteed, you should always choose two MFin electives during the course enrollment in our programme. Course enrollment results of other programmes may only be confirmed after that course has started. If your enrollment is successful, you can drop the MFin elective(s) and enroll in the other taught postgraduate elective(s).

It is your responsibility to make sure you obtain 72 credits to fulfill the graduation requirements for a single concentration and there is no overlapping of classes and exams in courses from different programmes.

*The list of available electives from other programmes may have prerequisite requirement(s) and is subject to change for future intakes.