International Financial Management
Subject Overview
The second Accounting and Finance elective, covering the international financial environment — foreign exchange markets and rate determination, international financial markets/instruments and derivatives, foreign exchange exposure and hedging, and financial management of multinational firms including FDI, capital budgeting and working capital policy. A 4-credit elective theory paper.
Unit-wise Syllabus
4 units — click WhatsApp below to get the full notes for each
Unit 1: Foundations and foreign exchange markets
Globalization and the multinational firm, importance and goals of international financial management, foreign exchange market structure, exchange rate quotations (direct/indirect, spot/forward), determination of exchange rates, international parity relationships
Unit 2: International markets and derivatives
Eurocurrency and domestic interest rates, international bond and equity markets, international portfolio investment, international sources of finance, futures/forwards/options/swaps on currency/equity/interest rates, trading strategies
Unit 3: Exposure and risk management
Foreign exchange exposure concept and relevance, management of economic/transaction/translation/interest rate exposure, hedging against equity, currency and interest rate exposure using derivatives
Unit 4: Financial management of multinational firms
Foreign direct investment and cross-border acquisitions, international capital structure and cost of capital, international capital budgeting, multinational working capital policy and cash management, exports and imports