FIN 709 (01) - Mortgage Banking and Fixed Income Securities

Mortgage Bank & Fixed Income

Durham   Paul College of Business&Econ :: Finance
Credits: 4.0
Term: Spring 2023 - Full Term (01/24/2023 - 05/08/2023)
Grade Mode: Letter Grading
Class Size:   30  
CRN: 56601
This course focuses on bonds and the bond market. While the cash flows of bonds are specified, their valuation is particularly challenging given interest rate movements, embedded optionality, and credit risk. As part of an examination of structured products, the course will examine the process of creating, valuing, and trading mortgages. Further, the course demonstrates the skills needed to manage fixed income portfolios in light of both client specific objectives and the market environment. Prereq: ADMN 570 or HMGT 655, ACFI 702.
Registration Approval Required. Contact Instructor or Academic Department for permission then register through Webcat.
Equivalent(s): ACFI 709
Only listed colleges in section: Paul College of Business&Econ
Only listed classes in section: Junior, Senior
Only listed majors in section: BUSADM:FINANCE
Instructors: Richard Kilbride

Times & Locations

Start Date End Date Days Time Location
1/24/2023 5/8/2023 TR 11:10am - 12:30pm PCBE 165
Additional Course Details: 

This course is a rigorous and analytical study of a wide range of topics in the fixed income arena. It focuses on securities (mainly bonds), and things that can look like securities (mainly loans) that promise an ongoing and consistent cash flow (hence: “fixed income”). The valuations of these things are influenced by interest rates and credit risk. The course is focused on the concepts and tools that are important to practitioners and investors who want to use these securities, whether the issuer or the investor. It includes a study of the markets in which these securities trade. While the cash flows of fixed income securities are contractually specified, the valuation of bonds is particularly challenging given interest rate movements, credit risk, and embedded optionality. 

Additionally, as part of an examination of structured products, the course will examine some basic elements of real estate finance, particularly the process of creating and valuing residential mortgages. 

Further, the course acknowledges that much of the controversy regarding the 2008 Financial Crisis has been directed at the mortgage market. Given that the first name of this course is “mortgage”, we will take a deep dive into that period and examine the underlying issues regarding that global crisis.

The class, by its nature, requires a moderate level of quantitative skill, but more importantly it will require consistent focus. In the end, we want you to not just know about interest rates, creditworthiness, bonds, and bond markets, but we want you to know what these things mean and how you can use the information. Prerequisit FIN 702, Investment Analysis