Analytical Finance Practicum

Spring, 2002

Professor McDonald

Presentations on June 10, 5:30 pm, Room G40 Jacobs Center

Descriptions of specific projects are below.

TimeGroup
5:30-5:50 Biotechnology Merger evaluation
5:50-6:10 Hedge Funds as an Asset Class (Firevision)
6:10-6:30 Analyzing Analyst Forecasts
6:30-6:50 Socially Responsible Investing (Ford)
6:50-7:05 Break
7:05-7:25 Energy Mergers (LEK Consulting)
7:25-7:45 Industry-focused Fixed Income (Eli Lilly)
7:45-8:05 Interest rate Hedging (Northview Bank and Trust)
8:05-8:25 Real options valuation (BCG)

Readings

Discussion DatePapersSlides
4/15Fama-FrenchSlides
4/22One classic paper on style attribution by William Sharpe. Two papers by William Fung and David Hsieh: Performance Attribution and The Risk in Hedge Fund Strategies Slides
4/29Two papers by Anna Shcherbina: Differences of Opinion and Why the Stock Market May Underweight Bad News
5/13Papers on real options (you should pay special attention to the first three): valuing internet companies, an attempt to make the previous paper more accessible, and patents & R&D as real options. If you are interested, there is more on valuing internet companies, and Monte Carlo valuation of American options.
5/20Agency, Information, and Corporate Investment is a paper surveying the literature examining whether capital is allocated correctly across and within firms.
5/20Two paper by Prof. Petersen: Form and Function in Banks and Distance and Lending
6/3Two papers on socially responsible investing: a study by the Hawaii legislature and an academic paper looking at the effect of SRI on the cost of capital.
6/3Two papers on mergers: an overview of findings (read to understand the results), and a paper on long-run returns (read to understand the methodological issues).

Projects

Here is a list of projects. In cases where a company offers more than one project, only one group will be able to work with the company. (This is to avoid overburdening the companies and people who are volunteering to help.)

CompanyDescription
Ford Motor Co.Socially responsible investing
Eli LillyIndustry-focused fixed income portfolio
LEKMergers in the energy sector: where is value created?
Northview BankInterest rate risk management for a community bank
Firevision LLCHedge funds as an asset class
Unnamed third partyEvaluation of biotech merger
ValuemetricsAnalysis of valuation methodology


© Copyright 2000, Robert McDonald. You can send me mail at r-mcdonald@northwestern.edu.

Last modified: Fri Jun 07 10:30:13 CDT 2002