The bachelor course Finanzwirtschaft offers an introduction to finance. To this end, we will introduce the concept of the time value of money, saving plans and explain how to evaluate fair prices of stocks and bonds. You will learn how to calculate a net present value and receive an introduction to the relationship between risk and return. Finally, we will give a brief overview on the valuation of stock options. Questions that will be answered in this course include: How much must be paid off each month to repay a loan within a given term? What decision rules exist to assess the profitability of a project and how are they applied? How is the risk of a project determined and, if necessary, diversified? What is the relationship between the value of a call option, a put option and the underlying stock?
Firm Strategies and Managerial Behavior
The module „Firm Strategies and Managerial Behavior“ is separated into two parts, as already suggested by the name. In the first part of the course we cover basic theoretical firm behavior in competitive markets. In this context we answer questions such as: How do firms set prices? How does game theory help us to gain a deeper understanding of firm behavior in the market? Are there different strategies in different markets? How do firms find optimal strategic answers to the behavior of other competitors? In the second part of the course we dive deeper into the individual firm. In this segment we cover the following questions among other things: How should firms design their compensation schemes to mitigate information asymmetries? What are possible incentive systems to guarantee that employees work for the purpose of the firm? By attending this module you get a first insight into the behavior of firms in different markets, into competitive firm behavior and into solutions for the practical design of compensation schemes.
In the Corporate Finance module you will learn more about the funding and investment behavior of firms. In this context we intensively talk about the differentiation between shares and bonds as well as debt and equity as funding resources. Furthermore, we cover the Modigliani Miller Theorem and its’ importance and applicability for reality. You also learn more about the valuation of firms, theoretically and with hands-on examples. This will give you an idea of why valuations differ dramatically depending on the methods used. In the context of this course we answer questions such as: Is there an optimal capital structure for firms and how can they get there? How do firms decide which projects and investments to follow in the future? How and why do firms need to incorporate taxes into their decision making? And how does a firm decide how to fund itself?
Corporate Finance Theory
The course Corporate Finance Theory deals at an advanced level with questions of optimal investment and financing decisions in markets with asymmetric information. To this end, the module starts with a brief review of core game theory topics. Further on, the module Corporate Finance Theory uses contract theory methods to discuss what conditions must be in place to ensure adequate effort provision by the entrepreneur and financing of the project. Further on, the following questions will be dealt with: What happens if other project opportunities arise after the contract is signed and what options have creditors to protect their initial investment? What impact has existing debt on the feasibility of projects and are there cases where existing creditors may be willing to cut their debt claims? What is the impact if a lender isn´t able to distinguish whether a project is managed by a capable or an incapable manager and what are the possibilities to differentiate between the different types?
Empirical Corporate Finance
The module Empirical Corporate Finance provides you with the opportunity to learn more about basic Corporate Finance concepts and to use economic literature to gain more knowledge about those concepts in reality. Among other things we take a closer look at classical models such as leverage theories, but also talk about more current topics such es Venture Capital or CDOs. In this context we answer questions such as: Do firms have a target capital structure? Is Venture Capitalism always positive, or is there a downside to it? Are characteristics of real-world financial contracts comparable to their counterparts in financial contracting theory? And why do firms tend to hold so much more cash than they used to? By reading and talking about economic literature intensively you learn how to ask critical questions and how to read and interpret scientific result. This can be extremely helpful when it comes to writing your Master or Seminar Theses in the future.
Case Based Corporate Finance I
In the context of the module Case Based Corporate Finance I you get the chance to work with highly motivated employees from KPMG on real-world cases. Just as in reality you will work in groups to get a deeper understanding of a distinct topic and to experience how work can be done out of university. The topics differ each semester due to the fact that we try to incorporate highly relevant problems. In the recent semesters solutions for the following questions have been searched: How do you found and a new bank und what’s important to know in that context? How can you find market gaps in which you can place your new bank? How to make your risk reporting modern and digital without forgetting mandatory rules? How can you support new start-ups to get external investors ready to invest? The final grade will be a result of your presentation and the seminar paper.
Case Based Corporate Finance II
The master course Case Based Corporate Finance II is in cooperation with our practice partner EY. You will work in groups on a real world case study from the M&A sector and then present your results. You will learn practical methods in portfolio evaluation under the guidance of experienced consultants. On the basis of a portfolio transaction actually carried out by EY in the past, you will learn what needs to be taken into account for the valuation, sale and transfer of such a portfolio. In the past years, students evaluated asset deals and share deals, for example. Questions that are answered include: What is the current earnings situation of the portfolio? How can a sustainable business plan for the portfolio look like? Which valuation of the portfolio is justifiable under the given parameters in order to avoid conflicts with the EU state aid regulation? What is the optimal transaction structure? The final grade results from the final presentation as well as the submitted seminar paper.