Course Details

Inefficient Markets
1.0 CR
Yes (may vary by section)
This goal of this course is to expose driven, inquisitive students to real-life examples of inefficiency in the public financial markets and build up a framework for thinking about the drivers of these inefficiencies. Students will explore how hedge funds evaluate these opportunities and capitalize on them to drive returns for their investors. The course will help students understand the concept of arbitrage and the limits of arbitrage opportunities. There will be a particular focus on asking why outsized returns exist in specific cases of market inefficiency. Students will be exposed to a myriad of potential root causes including counterparty risk, liquidity risk and investor segmentation. Through the course, students will learn how to price and evaluate a wide variety of financial instruments including depository receipts, credit default swaps, convertible bonds and distressed debt. The aim of the course is to give students several examples of bona fide market inefficiency and give them the tools to assess (and potentially capitalize on) future market opportunities in real-time
Finance Major